The local share market is lower at midday, following Wall Street’s dive on Friday after a ratings downgrade for Spain spooked investors. Mining stocks like BHP Billiton and Rio Tinto are leading the declines.
The S&P/ASX200 index is 22 points weaker at 4,435 and on the futures market, the SPI200’s down 28.
In economic news: Inflation jumped 3.7% in the year to May, up from the 2.9% annual pace in April, according to the TD Securities-Melbourne Institute Monthly Inflation gauge. The latest rise in prices is above the top of the Reserve Bank’s target range and represents the fastest monthly growth rate since October 2008. The central bank meets tomorrow to decide whether to again raise the official cash rate.
In company news: Aspen Pharmacare Holdings has entered into an agreement with troubled prescription drugs maker Sigma Pharmaceuticals Ltd (ASX:SIP) allowing it to conduct due diligence on the company. Aspen made a non-binding and indicative $707 million takeover offer for Sigma earlier this month. Under the deal, Sigma has agreed not to solicit rival offers for the next month of limited exclusivity. It is continuing to recommend that shareholders take no action with regard to Aspen’s bid. Shares in Sigma Pharmaceuticals Ltd (ASX:SIP) have gained 2% to $0.51.
And paints and explosives maker Orica Ltd’s (ASX:ORI) plans to spin off its DuluxGroup consumer business have been backed by an independent expert’s report. Grant Samuel says the demerger is in the best interest of shareholders and is unlikely to present any adverse tax consequences. Orica intends to distribute shares in DuluxGroup to its shareholders through a capital reduction worth about $216 million. Shares in Orica have risen 0.2% to $25.39.
Turning now to market indices: The best performing sector at noon is the Health Care index, up 86 points to 8,083. Shares in Healthscope are 4.97% higher at $5.49 after announcing it has received two new takeover offers. Shares in Sigma Pharmaceuticals and ResMed are also higher at midday.
The worst performing sector is the Materials index, down 107 points to 11,593. Shares in Aurox Resources lost 2.96% to $0.655, while shares in Atlas Iron and OM Holdings are also lower.
Looking to New Zealand and the NZSX50 is up 14 points. Taking a look at the top 4 stocks by turnover: At the top is Telecom of New Zealand with stock up 2.69% at $1.91, followed by Fletcher Building, Auckland International Airport and Westpac.
To gold and the dollar: Gold is trading at US$1,211.60 an ounce and the Aussie dollar is trading at 84.72 US cents.
