Midday: Aus shares gain momentum

Market Reports

The Australian share market has shrugged off soft leads and a gained momentum, rising up to 0.7 per cent. Investors have kept their eyes on local economic reports, production results and market guidance ahead of the upcoming reporting season.

The S&P/ASX 200 index is currently trading 30 points stronger at 4,136. On the futures market the SPI is 29 points higher.

Economic news

The Reserve Bank of Australia’s latest minutes from its July board meeting reveal members saw no need for any further adjustment to the cash rate of 3.5 per cent, following recent rate cuts and signs the domestic economy had a little more momentum.

Australians bought less cars than expected last month. According to the Australian Bureau of Statistics sales of new motor vehicles dropped 0.6 per cent to 91,375 new cars sold in June. Sales are still 18.4 per cent higher from the same time last year. 

Company news

Mining and materials group Arrium Limited (ASX:ARI), who recently changed its name from OneSteel, has forecast its full year net profit will fall by up to 74 per cent, partly reflecting its restructuring costs.   

Pilbara focussed iron ore miner Fortescue Metals Group Limited (ASX:FMG) has achieved record fourth quarter shipments but warned its expansion will cost $US600 million more than expected.

Home improvement manufacturer Gale Pacific Limited (ASX:GAP) expects its annual net profit to rise 19 per cent on the back of stronger than expected sales amid tough trading conditions.

Equipment manufacturer Zicom Group Limited (ASX:ZGL) says its fiscal 2012 profit will fall by less than previously forecast and expects its fiscal 2013 profit to jump by more than 40 per cent on the back of a recovery in the offshore marine sector. 

Best and worst performers

The best performing sector is Financials Excluding Real Estate Investment Trusts gaining 66 points to 4,876. Shares in Bendigo and Adelaide Bank Limited (ASX:BEN) have risen 2.32 per cent and trading at $7.95. Shares in ANZ Banking Group (ASX:ANZ) and Westpac Banking Corporation (ASX:WBC) are also stronger.

The worst performing sector is Industrials, falling 2 points to 3,199. Shares in Transpacific Industries Group Limited (ASX:TPI) have fallen 4.28 per cent, trading at $0.73. Shares in Virgin Australia Holdings Limited (ASX:VAH) and QR National (ASX:QRN) are also lower.

Gold and the dollar

Gold is trading at $US1,595 an ounce.
The Australian dollar is buying $US1.029.