The Data
The Australian share market has ignored soft overnight leads and opened higher to end a three day losing streak. At noon, the market is 0.77 per cent up.
The S&P/ASX 200 index is 43 points up at 5,114. On the futures market the SPI is 40 points higher.
Economic news
Business confidence in the December quarter was at its highest in more than 2½ years, according to the NAB Quarterly Business Survey. Business conditions lifted to their highest level in more than 12 months suggesting activity is starting to reflect increased confidence but is still below trend. Forward indicators including forward orders remain soft which is depressing labour demand. Business investment intentions outside of mining rose unexpectedly, though near-term employment expectations remained soft.
The survey indicated stronger housing sector, largely on the back of investor activity, higher asset prices and a lower Aussie Dollar and interest rates are all contributing to improved sentiment.
The ABS has announced that Australian retail turnover rose 0.5 per cent in December 2013, seasonally adjusted. That was slightly down on a rise of 0.7 per cent in November 2013.
Food retailing lead the increase with a 2.5 per cent rise and was also the strongest contributor in dollar terms. Cafes, restaurants and takeaway food services and department stores were also up. Other retailing was down 3.1 per cent in December as well as clothing, footwear and personal accessory retailing and household goods retailing.
Turnover rose most in New South Wales but fell in the Northern Territory and South Australia.
Company news
Woolworths Limited
(ASX:WOW) has announced that sales increased by 6% across all areas of its business to $31.8 billion in the first half of Fiscal 2014.
Strong growth in its Australian food and liquor and New Zealand supermarket business over the Christmas period helped drive the results. Petrol sales also increased by 8%.
CEO Grant O’Brien pointed out that Woolworth’s online sales topped $1 billion for calendar year 2013, an increase of 40% over the previous year.
Shares in Woolworths are trading up 1.74 per cent at $34.51.
FlexiGroup Limited
(ASX:FXL) has posted a first half cash profit of $39 million, up 20 per cent on the same period a year ago.
Managing director and CEO Tarek Robbiati has pointed to the company’s business diversification strategy as the main reason for the rise.
Mr Robbiati says he expects the company’s purchase of Thinksmart’s Australian and New Zealand assets to drive growth in fiscal 2015.
Flexigroup reaffirmed full year guidance of between 17 and 19 per cent growth of $84 to $86 million.
The board declared an interim dividend of 8 cents per share.
Shares in FlexiGroup Limited
(ASX:FXL) are trading up 2.42 per cent at $4.23.
The best and worst performers The best performing sector is Consumer Staples gaining 162 points to 9,730. Shares in Treasury Wine Estates Ltd
(ASX:TWE) have risen 2.33 per cent and trading at $3.51. Shares in Wesfarmers Ltd
(ASX:WES) and Woolworths Limited
(ASX:WOW) are also stronger.
The worst performing sector is Real Estate Investment Trusts, falling 4 points to 983. Shares in Australand Property Group
(ASX:ALZ) have fallen 1.17 per cent, trading at $3.81. Shares in Westfield Group
(ASX:WDC) and Mirvac Group
(ASX:MGR) are also lower.
Finally, to gold and the dollar: Gold is trading at $US1,258 an ounce.
The Australian dollar is buying $US0.8975.
