Australian Stock Market Report – Midday December 2, 2014

An office worker talks on his phone as he looks the stock board at the Australian Securities Exchange (ASX) building in central Sydney June 15, 2012. Asian shares edged up on Friday, and the euro held most of the previous session's gains, as nervous investors took comfort from plans for coordinated action by major central banks to stabilise markets if Sunday's election in Greece results in turmoil. Reuters

 Australian shares are being led higher by the mining and energy sectors with the ASX 200 Index rising by 0.7 per cent. Despite today's rise, the local market had its worst day since 10 October yesterday, hit a 1.5 month low in the process and slumped by 3.5 per over two sessions.

 Global markets ended mostly lower overnight despite somewhat of a recovery in commodity prices.

 Mining and energy stocks are up by more than 2 per cent with market participants taking pause from the selling. The price of oil rose by 4.3 per cent overnight after hitting a 4.5 year low at the end of last week. Both industries have been major drags on the market since last Thursday. OPEC's decision to maintain production quotas was a catalyst.

 BHP Billiton (BHP) is the single biggest contributor to the gains at lunch, with its 3.2 per cent surge at lunch accounting for 10pts of the ASX 200's 47pt gain. Yesterday the world's largest miner fell to a 5.5 year low however.

 Qantas (QAN) shares are down by 2.5 per cent following the rise in oil prices overnight. Despite today's weakness QAN has surged by 12 per cent over the previous two trading sessions. QAN spent around $4.5bn on fuel last year and if the 30 per cent fall in jet fuel prices recorded so far this financial year is maintained for an extended period, some expect a saving of more than $1bn for Australia's largest airline.

 Woolworths (WOW) is down 1.5 per cent today and continues to be an underperformer. Australia's largest supermarket chain released sluggish quarterly sales in recent weeks and slumped by 13.5 per cent in November. WOW shares briefly rebounded by 2 per cent last Thursday following it maintaining FY15 profit forecasts.

 On the economic front, dwelling approvals rose by 11.4 per cent in October after the 11 per cent slump in September. This afternoon the Reserve Bank is likely to keep interest rates on hold at 2.5 per cent at its last monthly meeting until February 2015. The accompanying statement will be of interest.

 The Australian dollar buys US$0.848, €0.68, ¥100.4 and £0.539. Volume is average with 846.1m shares traded worth $2.3bn. 425 stocks are up, 370 are down and 307 are unchanged.

[Kick off your trading day with our newsletter]