Australian Stock Market Report – Midday 12/2/13

MID-SESSION REPORT
(12.20pm AEDT)

The Australian sharemarket is losing ground despite a stronger open. The All Ordinaries Index (XAO) is down by 0.8 per cent, with just the energy players managing to remain slightly firmer.

Yesterday, some better than forecast Chinese economic data helped our miners and Australian dollar lift in the first few hours of trade. At 12.45pm (AEDT) however; another report on the health of China's manufacturing industry will be issued and is likely to move stocks and currencies (particularly if it surprises the market).

Commodity prices rose on Friday, with a 1 per cent jumped in gold assisting the precious metal producers lift. Newcrest Mining (NCM), Australia's biggest gold miner, is up 2.86 per cent. A half day of trade in the U.S. on Friday has given us little to work with this morning.

Grain handler, Graincorp (GNC) is down 2 per cent after CEO Alison Watkins announced her resignation from the firm. Current Chairman Don Taylor is stepping in as the acting CEO. Last week the Federal Government rejected a $3.4 billion for GNC, saying the takeover was not in the national interest. GNC shares have slumped by 25 per cent in just five trading sessions.

Grocery wholesaler, Metcash (MTS) is up 6.4 per cent after announcing a 20 per cent lift in first half profit to $98.9 million. Its exit from Franklins supermarkets (integration with IGA) is helping with its cashflow.

Despite a 1.8 per cent fall in the number of building approvals granted to developers by councils in October; the result is still better than anticipated. Also keep in mind that approvals surged by 14.4 per cent in September.

A report issued by RP Data-Rismark today showed that property prices in Perth gained by 2.9 per cent in November (the biggest rise in Australia). Over the past 12 months however, Sydney has been the standout with a 12.9 per cent improvement in property prices recorded. Hobart has underperformed most, with a 1.4 per cent fall in prices recorded over the year.

At lunch, 842 million shares have been traded, worth $1.78 billion. 319 stocks are higher, 462 are in the red and 325 are unchanged.

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