Australian Stock Market Report – Afternoon 5/22/14
By Tom Piotrowski, CommSec Market Analyst | May 22, 2014 5:45 PM EST
Local stocks were able to add to early gains thanks to a better than expected reading on Chinese manufacturing. The ASX 200 ended the session within sight of the best levels of the session when the index was up by 67 points. Participation was solid with around $4.6 billion in turnover.
An office worker is reflected in the window of the Australian Securities Exchange building displaying the ASX50 curve for Wednesday in central Sydney August 7, 2013.
In contrast to earlier sessions this week, every sector measured by the ASX ended higher led by the materials index. Improving sentiment early in the day consolidated after the encouraging read on the HSBC flash measure of Chinese manufacturing. HSBC said that it's Chinese manufacturing index rebounded sharply to 49.7 in May, up from 48.1 in April. The improvement was broad-based with both new orders and new export orders back in expansionary territory. Disinflationary pressures also eased over the month and output prices increased for the first time since November 2013. However, the employment index fell further to 47.3, which implies that this month´s uptick in sentiment has not yet filtered through to the labour market. Fortescue Metals Group continued to trade in volatile fashion rising by 3.6%.
Elsewhere in the resource sector Woodside Petroleum (WPL) was in focus as it hosted its investor day. The group has been in focus after announcing the exit from the Israel-based Leviathan project which sparked calls for a capital return to investors. Woodside says it will focus on new projects in the $1 billion-to-$5 billion range and maintain a disciplined investment stance, with the Browse gas project in Western Australia to be the ´´foundation´´ of its next phase of growth. WPL shares ended up by 1.2%
Elsewhere, Qantas share ended with a gain of 3.7%. The airline has indicated it no longer plans to add capacity on domestic routes in the July-September period, extending an olive branch of sorts to Virgin in a prolonged and costly battle for customers that has led to an oversupply of air tickets at discounted prices
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