The Australian sharemarket ended slightly weaker today,
however ended the month and the quarter in positive territory.
Shares rose by around 0.8 pct in March however jumped by 7.7 pct
this quarter (January to March 2012). In fact, we have had the
best start to a new year since 2006.
The mining and consumer staple stocks did well today however
most other sectors pulled back. Three of the four major banks
lost ground, however Westpac (
) rose slightly today. The world's largest miner, BHP Billiton (
) gained by 1.05 pct or 36 cents to $34.61 while Rio Tinto (
) jumped 1.62 pct or $1.04 to $65.40.
Hardware chain, Bunnings is planning to open as many as 85 new
stores in Australia. It is also expecting to add 6000 new jobs
over the next three years. Bunnings and Coles are both owned by
). WES rose 0.98 pct today.
Australia's largest airline, Qantas (QAN) has announced that
ticket prices will rise by as much as $30 on international
flights in a fortnight. This is to combat higher fuel prices. QAN
shares ended 1.6 pct lower today but have still gained by 20 pct
since the start of 2012.
On the economic front today, the latest private sector credit
and new home
reports were issued. Lending rose by 0.4 pct in February,
following a 0.2 pct rise in January. Over the year, credit growth
held unchanged at 3.5 pct.
Commsec Economist, Savanth Sebastian said that "The private
sector credit data tends to be a good forward looking indicator
on activity. If borrowings pick up, spending should follow suit
over the next few months. In that context the lack of significant
growth in business credit is disappointing. At present businesses
are cashed up and content to use existing cash facilities and
that trend is unlikely to change anytime soon. The data
reinforces the financial account report we put out yesterday -
Australian companies are cash rich, holding 45.4 per cent of
assets in cash and deposits - a 22-year high."
The number of new homes
in February hit an 11-year low. Mr Sebastian said that "Aussie
consumers and home-buyers remain super-cautious and that mood is
continuing to constrain activity for retailers and
housing-dependent businesses. Anecdotally the recent drop in
interest rates is boosting enquiry levels in the housing market,
but it is yet to show up in healthy rise in housing activity. And
while the latest pick up in new home sales is a positive it is
far from a full blown turnaround."
Next week, will be a little busier on the economic front,
particularly at the start of the week. On Monday, the latest home
prices, building approvals and monthly inflation reading will be
posted. On Tuesday, the Reserve Bank of Australia (
) will make a decision on rates while a retail trade report will
also be issued. The market is expecting rates to remain on hold
for yet another month.
In Asia, Japan released a number of reports, including a
manufacturing reading, household spending, inflation and
numbers. Japan's unemployment rate fell from 4.6 pct to 4.5 pct,
inflation is non-existent while its manufacturing sector expanded
slightly. Shares in Japan still eased by around 0.5 pct, while
stocks in China and Taiwan improved.
Tonight, the latest consumer spending report will be out of
France and the U.S. German retail sales numbers are also expected
to be released and improve by around 1.3 pct.
Volume of shares traded came in at 2.67 billion today, worth
$8.18 billion. 559 shares were up, 457 were weaker and 397 ended
At 4.30pm AEDT on the Sydney Futures Exchange, the ASX24
futures contract is up 0.09 pct or 4 pts to 4349.
Due to daylight savings, most major European markets are now
trading between 6pm (AEDT) and 2.30am (AEDT). Futures in Europe
are pointing to a slightly stronger start to trade tonight.
Dow Futures are currently a little higher; indicating that U.S
stocks could open in the black tonight. Due to daylight savings
taking place in the second week of March in North America, U.S
markets will now be trading between 12.30am (AEDT) and 7am
Turning to currencies, the Australian dollar (AUD) is weaker
and buys US104 cents. The AUD is currently trading at £65 pence
and €77.8 cents.
Commsec Market Analyst
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