Australian Stocks: What Happened Today?

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            [0] => ((DLS))
            [1] => ((LEI))
            [2] => ((WOW))
            [3] => ((BBG))
            [4] => ((FWD))
            [5] => ((RSG))
            [6] => ((MML))
            [7] => ((RRL))
            [8] => ((MMS))
            [9] => ((WHC))
            [10] => ((SBM))
            [11] => ((MTS))
            [12] => ((LNC))
            [13] => ((AWE))
        )

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            [0] => DLS
            [1] => LEI
            [2] => WOW
            [3] => BBG
            [4] => FWD
            [5] => RSG
            [6] => MML
            [7] => RRL
            [8] => MMS
            [9] => WHC
            [10] => SBM
            [11] => MTS
            [12] => LNC
            [13] => AWE
        )

)

This story features WOOLWORTHS GROUP LIMITED, and other companies.
For more info SHARE ANALYSIS: WOW
The company is included in ASX20, ASX50, ASX100, ASX200, ASX300 and ALL-ORDS

By Stephen Hogan, Senior Private Client Adviser, Equities/Derivatives

Australian Market

The Australian market (XJO) closed up 0.9 points or 0.02% to 5047.2 today. The market begun the day moving lower being dragged down by Woolworths and some other blue chips, creating a low of 5025.7 at 11:30. The XJO picked up from its lows in anticipation of RBA Gov Glenn Stevens speech (more below) to push just over opening price and finish flat. Overnight the Dow Jones fell -36.86 points or 0.24% to 15,522.00, which was partly responsible for the weak opening this morning. The best performing sector of the day was Telecommunications, rising 1.57% and the worst was Consumer Staples, falling -1.24.

In economic news, building approvals fell 6.9% in Australia for the month of June, down 13 per cent on a year ago. Forecasts were for a rise of 2.2%. Local councils approved the construction of 12,778 new homes, including houses, townhouses and apartments in multi-unit buildings, in June, compared to the 13,727 approvals in May, seasonally adjusted.

RBA Governor Glenn Stevens made a speech at a charity lunch in Sydney today, stating that monetary policy must reflect the pressures being felt in Australia's economy. Stevens said the latest inflation figures show there is room to cut the official cash rate below 2.75%. "We have been saying recently that the inflation outlook may afford some scope to ease policy further if needed to support demand. The recent inflation data do not appear to have shifted that assessment."

The AUD fell from buying U.S. 92c in the morning to 90.93c during and after Steven's comments. "The investment spending by the resources sector will no longer be adding to growth in demand in Australia. In due course it will, instead, be subtracting from it."

"Since we wish to see aggregate demand in the economy sufficient to utilise the productive resources of labour and capital that we have, this means that we would like to see a rotation to other sorts of demand as the resources sector demand slows," he said. "The 'post boom' growth story of the economy would desirably involve stronger expansion in some other sectors, including those that have seen weaker than normal conditions in the past couple of years."He acknowledged that much of that shift hinges on strong international demand for a wider range of Australian products.

Drillsearch Energy Limited ((DLS)) generated a record $99 million in revenue in FY13 thanks to its new operating oil pipeline in the Cooper Basin. DLS reported that the new Bauer to Lycium oil pipeline was producing 10,000 barrels of oil a day contributing to the record 600,000 barrels of oil equivalent and $50.7 million in sales revenue for the quarter.

Leighton Holdings Limited ((LEI)) sealed a $2.8 billion contract with Wynn Resorts in Macau to build a new luxury casino. The deal is the largest ever scored by Leighton's Asian division, building a 450,000 square metre resort and hotel on the Cotai Strip. Wynn Resorts owns casinos in Las Vegas and Macau. LEI chief executive Hamish Tyrwhitt said the project was part of a broader plan to continue to grow the company's presence in Asia. Construction is due to be completed in early 2016.

Woolworths ((WOW)) reported their FY13 sales results, with sales for the year to June 30 rising 4.3% to $59.16 billion. The Australian food and liquor saw sales rose 6.6% for the 2013 financial year to $40.03 billion, while the New Zealand supermarkets division gained 6.9%. Separately the petrol division rose 1.2%. Big W saw sales rose 4.9% and the hotels division jumped up 22% for the year.WOW forecast large losses for its hardware chain Masters, previously forecasting a pre-tax loss of $157 million. WOW Chief Executive Grant O'Brien said, "Momentum continues to increase in Australian Food and Liquor with comparable sales growth for the second half higher than the first half and the prior year." 

AUD is currently trading at $0.9073, down -$0.0130 against the USD.

Top Performers

Billabong International Limited ((BBG)) up $0.03 or 7.79% to $0.415

Fleetwood Corporation Limited ((FWD)) up $0.24 or 6.54% to $3.91

Resolute Mining Limited ((RSG)) up $0.045 or 5.59% to $0.85

Medusa Mining Limited ((MML)) up $0.12 or 5.56% to $2.28

Regis Resources Limited ((RRL)) up $0.17 or 5.12% to $3.49

Bottom Performers

McMillan Shakespeare Limited ((MMS)) down -$0.63 or -6.72% to $8.75

Whitehaven Coal Limited ((WHC)) down -$0.105 or -5.00% to $1.995

St Barbara Limited ((SBM)) down -$0.025 or -4.95% to $0.48

Metcash Limited ((MTS)) down -$0.17 or -4.63% to $3.50

Linc Energy Ltd ((LNC)) down -$0.075 or -4.41% to $1.625

Our Comments

Another small up day just slowly tracking higher little bit by little bit.

BHP, QBE and TLS responsible for most of the gains… banks were pretty flat overall and the staples dragged us down.

The central bank's Governor Glenn Stevens told a business audience today that the current record low setting of interest rates was starting to encourage more risk taking, but not by so much "that we see a serious impediment to further easing" of interest rates. This dragged the market up off its lows mid afternoon with the expectation another rate cut is coming soon.

AWE ((AWE)) let us down today with its production report flagging revenue coming in under guidance.

(For a more comprehensive summary of last night’s market action see FNArena’s Overnight Report.)
 

Re-published with permission. Views expressed are not by association FNArena's (see our disclaimer).

Stephen Hogan is an Authorised Representative of Novus Capital. Authorised Representative No.345411 – http://www.stephenhogan.com.au

Novus Capital Limited ("Novus") is holder of Australian Financial Services Licence No 238 168. Novus, its directors, officers, associates and employees each declare that they, from time to time, may hold interests in financial products and/or earn brokerage, commission, fees or other benefits from financial products mentioned in this e-mail or attached documents. Unless specifically stated within this e-mail or an attached document, any information communicated by this e-mail constitutes unsolicited general financial product advice which has been compiled without regard to any investor's individual objectives, financial situation or needs. It is not specific advice for any particular investor. Before making any decision about the information provided, you need to consider the appropriateness of this information having regard to your individual objectives, financial situation and needs and consult your adviser. Any indicative information and assumptions used here are summarised and also may change without notice to you, particularly if based on past performance or relate to a future matter.

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