The Australian share market has managed to shrug off weak
offshore leads and fears of a mass sell-down to
the trading day on a positive note. US and European markets
slumped overnight, as uncertainty surrounds the future of the
French and Dutch governments. The local share market started the
trading day on a flat note, defying predictions of a 0.6pct fall
and at lunchtime in the East is trading firmer by 903pts or
0.2pct to 4439.6.
) shares are trading higher, up 1.7pct to $29.84 in early trade
after releasing its quarterly update to the market. Third quarter
sales at Coles supermarkets rose 4.9pct on the year to $7.85
billion, as more customers chose to shop at the chain and more
goods were sold. Sales came in at $7.85 billion, while Kmart
sales rose 1.2pct in the quarter to $813 million. However
sales slumped 4.4pct to $692 million. Rival Woolworths (WOW)
shares are up 0.4pct to $25.93.
Also today, gold miner Newcrest (NCM) has updated the market,
but its report was not as favourable. The gold miner has cut its
forecasts for gold and copper production for 2012 after carrying
out a major review of its operations. Newcrest says it's facing a
variety of higher costs ranging from labour to energy and also
weathering the impacts of the strong Aussie dollar. At lunchtime
in the East, NCM shares are down 4.3pct to $26.41.
Other miners are also under pressure, due to falls in
commodity prices overnight. Shares in BHP Billiton (
) have dropped 0.7pct to $35.09 while Rio Tinto (
) is off 1.3pct to $65.76.
Core inflation data was released today for the March quarter,
coming in much lower than expected. The consumer price index rose
just 0.1pct in the three months to March, for an annual inflation
reading of 1.6pct. The trimmed mean number came in at 0.3pct for
"Inflation is well and truly contained and the Reserve Bank is
all but certain to cut interest rates on May 1," said CommSec
Chief Economist Craig James of the data. "The low inflation data
removes the last hurdle for the Reserve Bank to cut interest
rates next month. The sluggishness in the domestic economy has
ensured that businesses continue to absorb any increases in
costs, while the strength of the Australian dollar continues to
keep imported prices low. In addition the uncertainty and
downside risks to the global economy have resulted in subdued
commodity price in recent months."
The Australian dollar fell on the inflation data and at
12.45pm AEST is buying US102.78c, £0.6374 and €78.13c.
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