The local share market is lower at midday, investors cautious ahead of a key U.S. employment report to be released on Friday. A fall in metal prices and some weak company earnings results also weighing on the market and denting optimism of an economic recovery.
The S&P/ASX200 index is down 41 points at 4,286 and on the futures market the SPI 200’s down 44 points.
In economic news: The RBA has raised its forecast for gross domestic product growth to 0.5 per cent for 2009, up from previous guidance in May of a 1 per cent decline.
The central bank also says it may raise rates to more normal levels as the economy starts to recover. For the time being however, it believes the low rates are appropriate.
To business news at midday: Insurer Suncorp-Metway Ltd (ASX:SUN) says it expects to report a fall in full year earnings as a result of volatile investment and credit markets and major insurance claims. The company says it expects full year profit before tax and items related to its acquisition of Promina, to be in the range of $790 million to $810 million, compared to profit of $967 million in the last financial year. CEO Chris Skilton says the 2009 financial year has been particularly challenging for the group with the combined effects of volatile investment and credit markets, subdued domestic economic growth and major insurance claims events impacting its business. Suncorp-Metway shares fell 1.25 per cent to $7.90.
Sleep disorder equipment manufacturer ResMed Inc (ASX:RMD) has reported record revenue and income for the quarter to June 30 of US$252 million, up 7 per cent. For the year to June 30 revenue rose 10 per cent to US$920.7 million, with net income rising 33 per cent to US$146.4 million compared to the same period the year before. CEO Kieran T Gallahue says in the fourth quarter of fiscal 2009 the company continued to show strong growth year over year. ResMed shares gained 2.94 per cent to $5.25.
Turning now to market indices: the best performing sector at midday is the Health Care index up 34 points to 8,091. Shares in Biota Holdings up 1.99 per cent at $2.05. Shares in ResMed and Ansell are also stronger at noon.
The worst performer at midday is the Materials index, down 221 points at 11,066. Shares in Minara Resources down 4.74 per cent to $1.105. Shares in Alumina and OM Holdings are also lower at noon.
Looking to New Zealand and the NZSX50 is 7 points higher. Taking a look at the top five stocks by value on the NZSX50: Telecom of New Zealand, stock up 0.73 per cent at $2.77, followed by Westpac, Fletcher Building, Vector and ANZ.
To gold and the dollar: Gold is currently trading at $961.40 US an ounce and the Aussie dollar is trading at 83.84 US cents.
