Midday: AUD slips on RBA outlook, ASX down 0.8%

Market Reports

With Wall Street easing on US fiscal stimulus concerns, the Australian share market fell at open and is 0.8 per cent down at noon, with all of the big four banks posting losses and all the major sectors in negative territory.  
 
The S&P/ASX 200 index is 39 points down at 5,170. On the futures market the SPI is 46 points lower.
 
Economic news

The reserve Bank of Australia has released the minutes from its May board meeting, offering some explanation for its surprise rate cut. The Central bank says that for some months the Board had considered that the inflation outlook provided scope to ease monetary policy further, should that be necessary to support demand. Members were conscious of the strengthening conditions in the housing market, but also noted that credit growth had remained subdued.  In consideration of low inflation and soft growth,  the Board judged that a further reduction in the cash rate was appropriate.
 
The Australian dollar dipped to the days low of $US0.9752 on the news, but has recovered to be buying $US0.9787. 
 
Company news 
 
Ruralco Holdings Limited (ASX:RHL) first half net profit has sunk to $496 thousand, weighed down by costs associated with its pursuit of rival Elders Limited (ASX:ELD) and lower livestock prices. Chairman Richard England says despite the impacts on profitability, Ruralco’s core business has been resilient in its management of industry wide adverse seasonal conditions. Ruralco posted a $9.995 million profit in the previous corresponding period. Shares in Ruralco are trading steady at $2.80. 
 
Discovery Metals Limited (ASX:DML) says it has initiated a process which may result in a change of control of the company, opening the door to negotiations with interested parties which include previous suitor Cathay Fortune Corporation (CFC). Discovery says it has commenced the calling of bids from interested parties and has signed confidentiality agreements with a number of parties to date," the group said. Shares in Discovery Metals are in a halt, they last traded at $0.34. 
  
Best and worst performers

All the major sectors are down at this stage, the sector with the fewest losses is Consumer Staples, falling 56 points to 10,229. Shares in Treasury Wine Estates Limited (ASX:TWE) have risen 0.79 per cent and trading at $6.38. Shares in Metcash Limited (ASX:MTS) are higher while Woolworths Limited (ASX:WOW)  are slightly lower at noon.  
 
The worst performing sector is Financials excluding real estate investment trusts, falling 90 points to 6,651. Shares in Lend Lease Group (ASX:LLC) have fallen 3.73 per cent, trading at $10.21. Shares in ANZ Banking Group(ASX:ANZ) and AMP Limited (ASX:AMP) are also lower. 
 
Gold

Gold is currently trading at $US1,389 an ounce.