Australian Stock Market Report – Afternoon October 22, 2014

A man looks the board of the Australian Securities Exchange in central Sydney August 7, 2013. Australian shares skidded 1.3 percent on Wednesday, its biggest fall in five weeks, hit by sharp falls in miners and financials as regional markets tracked a soft Wall Street lead amid uncertainty about the U.S. Federal Reserve's stimulus programme REUTERS/Daniel Munoz (AUSTRALIA - Tags: BUSINESS)

ASX 200 gains for a 7th day

 The feature of the second half of Wednesday's trade was the ASX 200 recovering from a flat spot in late morning trade to make new session highs over the afternoon. The gains of the day were the best improvement of the current winning streak which has lasted for seven sessions.

 The consumer discretionary sector was one of the best improved groups of the day. A significant factor contributing to the gain was the September Quarter CPI reading released earlier in the day. The ABS reported that consumer prices rose 0.5% in the third quarter to be up 2.3% in the last year. Market consensus had consumer prices rising 0.4% in the quarter and 2.3% for the year. One of the key elements of the report was the moderation in price inflation following the removal of the carbon tax at the start of the third quarter. The removal of the tax resulted in a 5.1% decline in electricity prices over the measured period, the biggest decline on record. Investors were encouraged by the prospect that falling electricity prices will leave households with improved spending power. Myer (MYR) rose to $1.84 a gain of 5 cents or 2.8 per cent, Kathmandu (KMD) closed at $2.75 a gain of 4 cents or 1.4%.

 Shares in G8 Education (GEM0 were in a trading halt after announcing a capital raising. The funds will be used to expand the group's portfolio educational childcare facilities as it anticipates the purchase of another 20 centres. G8 said it will spend $24.35 million for 17 centres which can cater for 1,134 children. Three other centres will offer 209 licensed places and will be purchased for $12.35 million in conjunction with a transaction entered into with the Sterling group of companies. The group launched a $100 million equity raising placing 20.4 million shares at $4.91 with institutional investors. The shares last traded at $5.14.

 Origin Energy (ORG) shares ended the session up 3 cents or 0.2 per cent at $14.36. The energy producer said at its AGM that earnings were expected to grow substantially from the 2016 financial year. The group said it plans to stockpile gas supplies in an effort to exploit price increases in coming year years. ORG expects it's gas supplies to become more valuable in the years ahead as production starts at its giant LNG projects in Queensland allowing the export of LNG overseas at higher prices than can be realised domestically.

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