Banking enquiry weighs: Aus shares 0.6% lower at noon

Market Reports

by Jessica Amir

Following mixed leads from Wall Street, the Australian share market slipped at the open, with the majority of the market trading lower. And after the announcement of a Royal Commission into the banking sector the financials copped a blow with CBA falling over 2 per cent, leading the banks and insurance companies lower.

The Discretionary space is also copping a hit, down over 1 per cent after Aristocrat (ASX:ALL) lost over 4.8 per cent despite it announcing acquisition of Big Fish Games and stronger results.

Going the other way in the sector is, Tabcorp (ASX:TAH) with its shares trading over 1 per cent higher after CrownBet agreed not to contend the proposed merger of Tabcorp and Tatts in ACT and NSW. Meantime Crownbett and Tatts inked a deal to supply a digital stream of of SKY 1 and SKY 2 to CrownBet’s mobile and PC customers.

But a bout of fresh economic data from the ABS saw the local bourse claw back some of the early losses though, as dwelling approvals rose 0.7 per cent in October, and Private Capital Expenditure jumped 1 per cent in September.

The S&P/ASX 200 index was 36 points down or 0.6 per cent down at 5,976 at noon.

On the futures market the SPI is 32 points lower.

More company news

The Commonwealth Bank of Australia (ASX:CBA) says it is willing to cooperate with the Royal Commission into the Australia’s banking and financial sector. It comes as the Prime Minister and Treasurer announced the $75 million inquiry today, with Prime Minister Malcolm Turnbull, saying ‘The speculation about an inquiry cannot go on’.  He also said ‘it's moving into dangerous territory where some of the proposals being put forward have the potential, seriously, to damage some of our most important institutions’. Shares CBA at midday were trading over 2 per cent lower to $79.29.

Fashion and bag business, OrotonGroup (ASX:ORL) has gone into voluntary administration, saying it was the ‘better outcome’ than selling the company or recapitalisating it. Its stores will however continue to trade as usual, while its GAP stores are still scheduled to close by 31 January 2018. It comes after the company announced a downgrade in earnings amid a challenging environment. Its shares entered suspension today and but it last traded at $0.43.

Best and worst performers

The best performing sector is Telcos, gaining 1.2 per cent to 1,240. Shares in Telstra Corporation (ASX:TLS) have risen 1.47 per cent and trading at $3.44. Shares In Speedcast International (ASX:TPM) and TPG Telecom (ASX:TPM) are also stronger.

The worst performing sector is Consumer Discretionary, falling 1.1 per cent to 2,283. Shares in Aristocrat Leisure (ASX:ALL) fallen 4.89 per cent, trading at $22.54. Shares in Seven West Media (ASX:SWM) and Southern Cross Media Group (ASX:SXL) are also lower.

Gold and the dollar

Gold is trading at $US1,285 an ounce and one Australian dollar is buying 75.84 US cents.