The Australian share market opened slightly higher as investors treading water ahead of the June quarter inflation data and is 0.3 per cent up at noon, having pulled back a bit on the weaker than expected data. The CPI release saw the Aussie dollar plunge to the day’s low before recovering to now be in touch with the days high. Materials stocks are leading the days gains at this stage.
The S&P/ASX 200 index is 16 points up at 5,033. On the futures market the SPI is 13 points higher.
Economic news
The Australian Bureau of Statistics has released the highly anticipated consumer price index for the June quarter and the figures are slightly below expectations. The quarterly CPI rise is 0.4 per cent and the annual rise is 2.4 per cent. According the the ABS, Inflation was boosted by a rise in medical and hospital services, tobacco, new owner-occupier home sales, furniture and rent. The weakened figures have increased the odds of an August rate cut.
Company news
Australian Power and Gas Company Limited
(ASX:APK) expects to report a full year net loss of between $10.5 and $11.5 million due to weak demand in the face of high gas and electricity prices as well as a catalogue of bad debts. The energy retailer amended its earlier loss forecast of between $3 - $3.5 million however says the drop off in performance shouldn’t affect a potential takeover from AGL Energy Limited
(ASX:AGK). Shares in Australian Power and Gas are trading steady at $0.51.
Telstra Corporation Limited
(ASX:TLS) has been cautioned by the competition regulator that further attempts to increase its slice of the broadband pie by penetrating the low-cost internet provider market will be harshly scrutinised, on the back of yesterday’s rejected and abandoned bid for South Australian provider Adam Internet. According to various media reports the telco giant has been told by ACCC Chairman Rod Sims that the body is prepared to adjust regulatory laws to keep its ambitions in check. Shares in Telstra are trading stronger despite the Adam bid falling through, up 1.21 per cent at $5.02.
Best and worst performers The best performing sector is Materials gaining 146 points to 9,392. Shares in Medusa Mining Limited
(ASX:MML) have risen 8.92 per cent and trading at $2.32. Shares in Atlas Iron Limited
(ASX:AGO) and Fortescue Metals Group Limited
(ASX:FMG) are also stronger.
The worst performing sector is Consumer discretionary, falling 3 points to 1,656. Shares in Billabong International Limited
(ASX:BBG) have fallen 4.22 per cent, trading at $0.40. Shares in Tabcorp Holdings Limited
(ASX:TAH) and Flight Centre Limited
(ASX:FLT) are also lower.
Gold and the dollar
Gold is trading at $US1,344 an ounce and the Australian dollar is buying $US0.9314.
