The Australian share market is trading higher at midday after significant gains from Wall Street and Europe overnight. The share market has reacted positively following expectations that Ireland will accept a bailout. The S&P/ASX200 has lifted 0.67 per cent. The banks are mostly stronger as are the miners.
The S&P/ASX200 index is 26 points higher at 4,666 and on the futures market the SPI200 is up 28 points.
AMP Ltd (ASX:AMP) is due to begin a detailed examination of its would-be merger partner AXA Asia Pacific (ASX:AXA) within the next few days. Yesterday, AXA’s board unanimously backed the takeover, clearing the way for the $14 billion takeover. It has also paved the way for AMP to start its due diligence of AXA’s finances and secure the last remaining regulatory agreements. AMP hopes to complete the financial check up of AXA’s books by Christmas. If the deal goes through, AMP will snap up AXA’s Australian and New Zealand businesses for $14.1 while French insurer AXA SA will acquire the Asian assets for $10.4 billion, an $800 million increase on its previous offer. Shares in AMP are down 0.2 per cent at $5.10.
Australia’s largest insurer by market value, QBE Insurance Group Ltd (ASX:QBE) has agreed to acquire the US insurance operations of Renaissance Re Holdings for $279 million. QBE says the acquisition is expected to generate over $350 million of gross written premium in 2011 while net profit after tax is expected to come in over $30 million. QBE’s chief executive Frank O’Halloran says the acquisition, which includes a US crop insurance business, complements the company’s NAU crop insurance takeover which was announced in April this year. According to data compiled by Bloomberg, the acquisition of Renaissance Re marks the fourth purchase by QBE this year. Shares in QBE are up 0.24 per cent at $16.58.
Turning to market indices: The best sector is Telco Services, with the index up 22 points to 916. Shares in Telstra are up 3.13 per cent at $2.64. Shares in Amcomm and Singtel are also higher. The worst performing sector at midday is Utilities with the index down 20 points to 4,472. Geodynamics is down 3.09 per cent to $0.47. SP Ausnet and AGL Energy are also lower at midday.
To New Zealand: the NZSX50 is 16 points higher. Taking a look at the top 4 stocks by turnover: Telecom of New Zealand is at the top of the list with stock up 1.4 per cent at $2.17; followed by Westpac Banking Group, Fletcher Building and Telstra Corporation.
To gold and the dollar: Gold is trading at $US1,360 US dollars an ounce and the Aussie dollar is buying 99.07 US cents.
