Aussie shares are higher at midday as the financial stocks rebounded after taking a battering at the end of last week, investors feeling reassured after the United Arab Emirates central bank said it would offer support to Dubai World by giving them access to more money under a new facility.
The S&P/ASX200 index is 110 points higher at 4,682 and on the futures market the SPI 200’s up 97 points.
In economic news: The TD Securities - Melbourne Institute’s monthly inflation gauge rose 0.3% in November to an annual pace of 2.1%.
The ABS says business inventories in the third quarter rose 0.8%, company profits fell 2.1% for the quarter.
And the RBA reports that Australian private sector credit remained unchanged in October.
In company news: The Commonwealth Bank of Australia (ASX:CBA) has released a statement confirming that it does have a financial exposure to Dubai World but that it does not expect to incur a material loss as a result of the recently announced debt moratorium. The announcement follows similar ones from the other major banks who all say their financial exposure will not generate material losses. The Dubai Government is seeking at least a six month deferment on $60 billion in debt owed by its holding company Dubai World and large infrastructure company Nakheel. Shares in the Commonwealth Bank rose 3.5 per cent to $52.37.
Weapons maker Metal Storm Ltd (ASX:MST) has signalled that it may be forced to appoint an administrator. The company says the first tranche of around $2.1 million in funding from Assure Fast Holdings was due last Friday but as yet the funds have not been received. Assure Fast Holdings has provided the company with instructions that have been given to the remitting company, so Metal Storm anticipates that it will receive the funds shortly. Metal Storm says should its board determine that these funds will not arrive the company may consider the appointment of an administrator. Metal Storm shares soared 36.84 per cent to $0.026.
Turning now to market indices: Majority of sectors are in the black at midday, however the sector with the biggest gain is the Financials Excluding Real Estate Investment Trust index up 189 points to 5,372. Shares in NAB advanced 5.33% to $28.45. Shares in Macquarie Group and Lend Lease are also higher.
One of the sectors with the sectors with the smallest gain at midday is the Consumer Discretionary index, up 15 points to 1,582. Shares in Village Roadshow fell 4.99% to $1.715. Shares in Super Cheap Auto Group and Photon Group are also lower at noon.
Looking to New Zealand and the NZSX50 is 36 points higher. Looking at the top 5 stocks by turnover: At the top of the list is Telecom of New Zealand, stock up 2.92% at $2.47, followed by Telstra, Auckland Airport, Fletcher Building and Fisher & Paykel Appliances.
To gold and the dollar: Gold is trading at US$1,174.20 an ounce and the Aussie dollar is trading at 91.52 US cents.