Economy slows to 2.3% growth: ASX 0.5% higher at noon

Market Reports

by Rachael Jones

The Australian share market opened higher and shares continued to rise throughout the morning. Bellamy’s Australia (ASX:BAL) share price has had a very positive start to the week with shares rising today almost 7 per cent. Meanwhile Shares in Automotive Holdings Group (ASX:AHG) are down after reports of slowing vehicle sales yesterday from the Federal Chamber of Automotive Industries. Out of the sectors, Materials are leading the way – telco services are falling behind today. The S&P/ASX 200 index is 30 points up 0.5 per cent higher at 6229. On the futures market the SPI is 43 points higher.

Broker upgrades

Goldman Sachs has upgraded Domino's Pizza Enterprises (ASX:DMP) to a Buy from Neutral with an unchanged 12-month TP of A$50.50 based on strong store growth potential and improved execution in key regions like Japan.

Local economic news

The Australian Bureau of Statistics shows today that the Australian economy grew by a seasonally adjusted 2.3 per cent in 2018 after expanding by a below expectation 0.2 per cent in the December quarter. The data was below market consensus forecasts and fell short of the Reserve Bank's downgraded full-year growth target of 2.75 per cent.

Meanwhile, Philip Lowe of the Reserve Bank of Australia rules out interest rate rises this year. In his speech this morning he said that we are expecting the labour market to tighten and wages growth will increase further. This should boost household income and spending and provide a counterweight to the fall in housing prices.

Company news

Australian online foreign exchange and payments company OFX Group (ASX:OFX) has appointed Connie Carnabuci as a Non-Executive Director to the board effective from the month. She will also be appointed to the Remuneration and Nomination Committee. Connie has over 30 years’ experience in legal practice, management and strategy and is the General Counsel for the ABC. Shares in OFX Group (ASX:OFX) are up 2.49 per cent to $1.85

Best and worst performers

The best-performing sector is Materials, adding 0.9 per cent, while the worst performing sector is Telcos, shedding 0.1 per cent.

The best performing stock in the S&P/ASX 200 is Bellamy's (ASX:BAL), rising 6.93 per cent to $10.64, followed by shares in Independence Group (ASX:IGO) and Western Areas (ASX:WSA).

The worst performing stock in the S&P/ASX 200 is Automotive Holdings Group (ASX:AHG), dropping 4.53 per cent to $1.95, followed by shares in Perpetual (ASX:PPT) and Emeco Holdings (ASX:EHL).

Commodities and the dollar

Gold is trading at $US1,287 an ounce.
Iron ore price fell 0.8 per cent to US$87.03
Iron ore futures are pointing to a rise of 0.3 per cent.
One Australian dollar is buying 70.60 US cents.