Following a positive lead from Wall St at the end of last week, Aussie shares are higher at midday with mining stocks like Fortescue Metals Group and Murchison Metals leading the gains on the back of stronger commodity prices.
The S&P/ASX200 index is 31 points higher at 4,681 and on the futures market the SPI 200’s up 32 points.
In economic news: The ABS reports that sales of new motor vehicles rose 5.5% in November from October. This is the biggest gain in five months.
In company news: Qantas Airways Ltd (ASX:QAN) says it expects to report a profit after tax of between $50 million and $150 million for the first half of the 2010 financial year. The airline says passenger volumes and yields have improved since the second half of last fiscal year, with passenger numbers up 6.9% for the year to November. Qantas reported net profit after tax of $210 million for the first half of fiscal 2009, and net profit of $117 million for the full year. Qantas shares rose 5.11 per cent to $2.88 on the news.
A default on $324 million by listed mortgage owner RHG Ltd (ASX:RHG) has put the lender at risk of possibly defaulting on a further $2.5 billion in loans. RHG says in addition to the potential loss of $47 million of future income, there is potentially 26.8 million of RHG’s cash used as credit enhancement at risk. Last Thursday the NSW Supreme Court found that the company had defaulted on $324 million in loans used to finance mortgages; RHG says it has launched an appeal against this finding. RHG shares plunged 7.87 per cent to $0.585.
Turning now to market indices: The best performing sector at midday is the Materials index, up 192 points at 12,272. Shares in Murchison Metals advanced gained 6.86% to $2.18. Shares in Dioro Exploration and Sims Metal Management are also higher.
The worst performing sector at midday is the Telco Services index, down 35 to 1,138. Shares in Telstra fell 2.92% to $3.33. Shares in Telecom of New Zealand and IINet are also lower at noon.
Looking to New Zealand and the NZSX50 is 4 points lower. Taking a look now at the top 5 stocks by turnover: Heading the list is Pyne Gould Corp its stock steady at $0.46, followed by Telecom of New Zealand, AMP, Sky City Entertainment Group and Fletcher Building.
To gold and the dollar: Gold is trading at US$1,115.80 an ounce and the Aussie dollar is trading at 88.94 US cents.
