The local share market is flat at midday following a mixed lead from overseas markets with an increase in US factory orders and higher oil prices helping to lift resource stocks today.
The S&P/ASX200 index is 3 points lower at 4,921 and on the futures market the SPI 200’s down 16 points.
In economic news: The Australian Industry Group/Commonwealth Bank Performance of Services index eased 2.5 points in December to a read of 50. 50 is the threshold that separates expansion from contraction. A rise in interest rates is being seen as the cause of the slowdown.
ABS reports that building approvals rose 5.9% in November from the month before.
The Australian Chamber of Commerce and Industry’s expectations for business conditions index reached a read of 65.4 in the December 2009 quarter, from 62.8 index points in September 2009 quarter.
In company news: Top airline Qantas Airways Ltd (ASX:QAN) low cost offshoot Jetstar has formed a new alliance with AirAsia. In a joint statement the companies say the alliance brings together the Asia Pacific’s two leading low cost, low fare carriers and will focus on a range of major cost reduction opportunities and potential savings to the benefit of customers throughout the region. Key to the agreement is a proposed joint specification for the next generation of narrow body aircraft that will best meet the needs of the low fare customer of the future, both airlines will investigate opportunities for the joint procurement of aircraft. Qantas CEO Alan Joyce says the aviation market in Asia is a growth market, and has proven resilient over the past 12 months despite the tough operating environment, with significant growth in passenger numbers forecast in the region. Qantas shares rose 1.01 per cent to $2.99.
Wood chipping company Gunns Ltd (ASX:GNS) says the Bell Bay Pulp Mill in Tasmania will begin operation with 100% plantation timber, after it secured access to the Great Southern timber resource. Chairman John Gay says the appointment of Gunns as responsible entity for nine former Great Southern timber managed investment schemes gives the company the security of supply it needs. Shares in Gunns added 1.04 per cent to $0.975.
Turning now to market indices: The best performing sector at midday is the Materials index up 62 points at 13,011. Shares in Perseus Mining advanced 3.55% to $1.895. Shares in Incitec Pivot and Wattle are also higher.
The worst performing sector at midday is the Real Estate Investment Trust index, down 10 to 911. Shares in Bunnings Warehouse fell 1.87% to $1.835. While shares in Stockland and Mirvac Group are also lower at noon.
Looking to New Zealand and the NZSX50 is 2 points higher. Turning to the top 5 stocks by turnover: Topping the list is Telecom of New Zealand, stock up 0.39% at $2.58, followed by Fletcher Building, Auckland Airport, Infratil and AMP NZ Office Trust.
To gold and the dollar: Gold is trading at US$1,118.15 an ounce and the Aussie dollar is trading at 91.15 US cents.
