Buoyed by positive leads the Australian share market opened stronger but retreated in morning trade. Equities clawed back a little after the Australian Bureau of Statistics showed a pick-up in retail spending, lifting the retailer sector. Escalating concerns over Europe’s debt have erased earlier gains, with the financials bearing the brunt of the losses.
The S&P/ASX200 index is trading 26 points lower at 4,159. On the futures market the SPI is 20 points down.
Economic news
Retail spending picked up for the third straight month in September, in line with expectations. According to the Australian Bureau of Statistics spending rose 0.4 per cent to a seasonally adjusted $20.912 billion. Over the September quarter spending increased 0.6 per cent.
Australia's service industries continued to experience a contraction in activity last month. The Australian Industry Group and Commonwealth Bank’s performance of services index dropped 1.5 points to 48.8 in October. A level under 50 indicates contraction.
Company news
Perpetual Limited (ASX:PPT) has warned that it expects its underlying profit to fall in the first half of the 2012 financial year. The wealth manager now expects underlying profit after tax to drop by between 24 per cent and 37 per cent from the $41 million it achieved the same time a year before. Managing director, Chris Ryan, says the revision largely reflects the decline in equity markets from July 1, 2011. Shares in Perpetual have fallen 2.3 per cent and are trading at $20.81.
Boral Limited (ASX:BLD) expects to achieve a first half profit broadly in line with the prior half year’s result of $76 million. The building products maker has cautioned that uncertainty in the US and a dramatic slow down in Australian residential housing have continued to impact its operations. Boral is expecting more growth in the second half of the current financial year. Shares in Boral have dropped 2.17 per cent and are trading at $3.60.
Best and worst performers
The best performing sector is Consumer Discretionary, rising 3 points to 1,237. Shares in News Corp have gained 2.18 per cent and trading at $16.87. Shares in Aristocrat Leisure and OrotonGroup are also stronger.
The worst performing sector is Energy trading 214 points lower at 13,530. Shares in Energy Resources of Australia have dropped 2.11 per cent and trading at $1.855. Shares in WorleyParsons and Linc Energy are also down.
New Zealand
The NZSX50 has firmed 3 points. Taking a look at the top four stocks by turnover, Telecom Corporation of New Zealand is at the top of the list with stock adding 0.57 to $2.625 followed by Fletcher Building, Vital Healthcare, and ANZ.
Gold and the dollar
Gold is trading at $US1,733 an ounce.
The Australian dollar is buying $US1.0227 cents.
