Midday: Aus shares sink into red

Market Reports

The Australian share market has moved 0.5 per cent into the red at noon, weighed down by soft housing data and weakness from the miners and financials. The consumer discretionary sector has lifted, led by gains from Fairfax Media Limited (ASX:FXJ), on news Australia’s wealthiest woman Gina Rineheart is hunting a 14 per cent stake to become the media company’s largest shareholder.
 
The S&P/ASX 200 index has lost 23 points and is 4,239. On the futures market the SPI is 22 points lower.

Economic news

Manufacturing activity in Australia expanded at the beginning of this year. The Australian Industry Group and PriceWaterhouseCoopers’ Australian performance of manufacturing index increased 1.4 points to 51.6 in January this year. The read above 50 indicates expansion in the sector.

New homes sales dropped at the end of last year, despite a rate cut in November and December. The Housing Industry Association has reported new homes sales fell 4.9 per cent in December after rising 6.8 per cent the month before. In the last three months of 2011 sales added 0.2 per cent.

The Australian Bureau of Statistics has reported the weighted average of local house prices in eight capital cities eased 1 per cent in the fourth quarter of 2011, following a fall of 1.2 per cent in the third quarter. Over last year Australian house prices fell 4.8 per cent from 2010.

Company news

Shares in internet technology and marketing company Webfirm Group Limited (ASX:WFM) have jumped more than 12 per cent on news the company has inked a deal with accommodation site operator, Wotif.com Holdings Limited (ASX:WTF). Webfirm says its Adslot’s self-serve display sales platform will be implemented by Wotif, enabling advertisers to buy and create advertising campaigns on wotif.com. Webfirm’s CEO Andrew Barlow says the company is looking forward to playing a key role in building wotif.com’s display advertising revenue. Shares in Webfirm Group are trading 12.9 per cent higher at $0.07.

Shares in Zicom Group Limited (ASX:ZGL) have almost one third of their value after the company warned its full year profit after tax is expected to drop by up to 65 per cent. The industrial machinery and equipment manufacturer has blamed consolidation in the marine offshore sector and project delays among the reasons for the anticipated profit fall. Shares in Zicom Group have lost 29.03 per cent and are trading at $0.22.

Best and worst performers

Most sectors are in the red: The best performing sector is Consumer Discretionary gaining 5 points to 1,229.  Shares in Fairfax Media have advanced 8.78 per cent and trading at $0.805. Shares in Funtastic and David Jones are also stronger.

The only sector in the red is Materials, losing 109 points to 11,463. Shares in Aquarius Platinum are 12.08 per cent lower, trading at $2.33. Shares in Saracen Mineral Holdings and Atlas Iron have also lost value.

New Zealand

The NZSX50 is steady at noon: Taking a look at the top four stocks by turnover, Fletcher Building is at the top of the list with stock down 1.23 per cent to $6.44, followed by Telecom Corporation of New Zealand, Westpac and ANZ.

Gold and the dollar

Gold is trading at $US1,736 an ounce.

The Australian dollar is buying $US1.0603.  

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