Australian Stock Market Report – Afternoon 12/17/13

EVENING REPORT
(5pm AEDT)

Local stocks closed higher today for only the third time this month, although the All Ordinaries Index (XAO) finished off the day's highs.

The Federal Government released its Mid-Year Economic and Fiscal Outlook today (MYEFO), forecasting a $47 billion deficit for the current financial year. That equates to around three per cent of GDP. A budget surplus is not expected before 2017.

Locally, industrial, telco and consumer staples stocks fared best.

Wesfarmers (WES) rose 2.5 per cent to $42.56, a day after IAG (IAG) completed its institutional share placement to fund a $1.85 billion acquisition of WES's insurance division. IAG shares fell 5.3 per cent $5.40.

The worst performer on the ASX 200 was REA Group (REA) after CEO Greg Ellis tendered his resignation. REA shares fell 6.9 per cent today to $37.74 but have risen 109.7 per cent this calendar year.

Canadian firm Saputo today sweetened its takeover bid for Warrnambool Cheese and Butter (WCB) following the involvement of the Takeovers Panel. Saputo will lift its offer to $9.40 per share if it obtains more than 75 per cent of WCB shares and to $9.60 if it surpasses the 90 per cent threshold. WCB closed at $9.27 today.

Australia's population grew 1.79 per cent over the year to June 2013, which was the fastest population growth in 3½ years. Australia's population stood at 23,130,931 people at the end of June.

On the market overall, a total of 1.7 billion shares changed hands, worth $4.6 billion. 444 were up, 451 were down and 375 were unchanged.

At 4.30pm the SFE 200 Futures Index was at steady at 5101 points.

The Australian dollar is buying US89.42c.

In the US, the Federal Reserve begins a two-day policy meeting. The consumer price index and current account data are issued.

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