GPD 1.9% beat expectations: Aus shares 0.24% lower at noon

Market Reports

by Jessica Amir

The local share market nose dived at the open after investors on Wall Street absorbed the wrath of North Korea tension from the weekend. Just in the first 10 minutes of trade the ASX200 lost 0.7 per cent, more the than futures predicted.

But thanks to stronger than expected local economic growth figures, we started to recover from early losses in the first two hours of trade. But it wasn’t enough to get half the sectors out the of red, with Financials having the biggest drag, with a few heavy weights going ex-dividend too 

The energy space is leading the charge, after US refineries fired up again after Hurricane Harvey, which saw crude oil prices jump 2.9 per cent overnight. The likes of Senex Energy (ASX:SXY) rose over 20 per cent, while Beach Energy (ASX:BPT) and Origin Energy (ASX:ORG) are also pushing up.

The S&P/ASX 200 index is 14 points down or 0.24 per cent lower at 5,693.

On the futures market the SPI is 18 points lower. 

Asian markets 

Japan’s Nikkei has lost 0.4 per cent, Hong Kong’s Hang Seng has shed 0.42 per cent and the Shanghai Composite has lost 0.24 per cent.

Local economic news 

The Australian economy grew by 0.8 per cent in seasonally adjusted terms in the June quarter, on par with expectations. However, for the 2016-2017 financial year, the economy grew 1.9 per cent over the year, beating expectations of 1.8 per cent.

The biggest sway came from domestic spending which rose 1 per cent in the quarter, largely driven by household consumption, expenditure on food, clothing and household furnishings increasing.

The ABS says swings in coal and iron ore prices had a significant affect on the economy in terms of export revenues and real incomes, though export volumes continued to grow in the June quarter. Meantime, dwelling construction remains at elevated levels, while new residential building approvals are falling.

Company news

The Supreme Court of Victoria has approved ASG Group’s proposed purchase of SMS Management and Technology (ASX:SMX). SMS says it will lodge a copy of the Court’s orders with ASIC on 7 September 2017 and at that time, the scheme of will become effective. As such, SMS shares will be suspended from the close of trading on the same day. Shares in SMS Management and Technology (ASX:SMX) are trading 0.14 per cent higher at $1.79

Latin Resources (ASX:LRS) has inked a deal to sell its copper assets in Peru for $6.8 million in cash and shares. The mineral exploration company says the purchaser will have 30 days to complete its due diligence and execute a formal sale agreement. The company says the divestment adds significant value to its portfolio, while it will also enable it to focus on its lithium projects in Argentina.

Best and worst performers

The best performing sector is Energy, gaining 0.86 per cent to 9,236. Shares in Beach Energy Limited (ASX:BPT) have risen 2.57 per cent and trading at $0.70. Shares in Origin Energy Limited (ASX:ORG) and Whitehaven Coal Limited (ASX:WHC) are also stronger. 

The worst performing sector is Financial, falling 1.06 per cent to 6,243. Shares in Perpetual Limited (ASX:PPT) have fallen 4.29 per cent, trading at $52.93. Shares in Insurance Australia Group Limited (ASX:IAG) and Janus Henderson Group (ASX:JHC) are also lower. 

Commodities and the dollar

Gold is trading at $US1,339 an ounce and one Australian dollar is buying 79.98 US cents.

 

Jessica Amir

Finance News Network
Jessica joined FNN in January 2017 after having worked in financial advising for seven years and in TV journalism for seven years, specialising in finance, equities and analysis. She has interviewed former Prime Ministers of Australia, Tony Abbott, Julia Gillard and Kevin Rudd and ex Treasurer Jo Hockey. Jessica has worked as a journalist with Sky News Business, ABC 1, ABC's The Business, ABC24 and has also been a regional Channel 7 and 9 TV reporter.