Jobless rate falls to 4.6%, RBA to end QE: ASX down 0.1% at noon

The Australian sharemarket was slated to have a firmer start after the Federal Reserve took a hawkish pivot to combat the surge in record high inflation. Wall St roared after market participants heard what they were expecting, a speed-up taper timeline igniting tech stock bulls to charge ahead.

Coming off this optimism, the local bourse had a milder start opening 0.1 per cent higher then got dragged down by a 8 per cent dive by biotech CSL (ASX:CSL) after its trading halt was lifted. The fall was close to the difference in the share price value of the capital raise for Vifor Pharma. The moves took the whole healthcare sector lower by 5 per cent and crowned them worst performer of the session so far.

By 10 minutes of trade, the XJO was down 0.4 per cent but attempting to offset the losses were technology stocks. Tech bulls bucked the trend for the past few days mimicking the moves from Wall St after the Nasdaq was outperformer. The local tech sector is pushing higher thanks to Afterpay (ASX:APT) adding 1.8 per cent.

Across the miners, Fortescue Metals (ASX:FMG) is trading 1.2 per cent higher while BHP (ASX:BHP) and Rio Tinto (ASX:RIO) are trading 1.1 per cent and 0.3 per cent respectively.

The banks are mixed also with National Australia Bank (ASX:NAB) adding 0.8 per cent, followed by Commonwealth Bank (ASX:CBA) by 0.1 per cent. Westpac (ASX:WBC) erased its gains from yesterday trading 0.5 per cent lower.

Market participants have been bracing themselves for a busy tail end of the week with major central banks like the Fed, ECB, and BoE slated to meet within 24 hours of each other. Back home, two RBA policy makers were scheduled to make online speeches after the Fed’s performance.

The Reserve Bank of Australia’s $350 billion bond buying program is likely to scale back from February next year and finish in May, said governor Philip Lowe at the CPA Australia Riverina Forum in Wagga Wagga. However, with Omicron now in the picture, it poses “downside risk” to the nation’s strong economic outlook, and the central bank’s path forward around its monetary stimulus program.

In the context of this, the local market started to erase it losses just 30 minutes before midday after they shrugged the central bank’s message for now, and focused on the nation’s unemployment rate. It improved by 0.6 per cent helped by the ease in mobility restrictions, a result that came in better than expected.

Meanwhile on the IPO front, real estate stealth Qualitas (ASX:QAL) surged on their official debut on the ASX by 3 per cent to $2.58 after raising $335 million at $2.50 offer price, though Xpon Technologies (ASX:XPN) surged 30 per cent after the cloud based marketing technology player raised $12.5 million at $0.20 a share.

At noon, the S&P/ASX 200 is 0.1 per cent or 7.20 points lower at 7,320. The SPI futures are pointing to a rise of 2 points.
 
Local economic news

Employment increased by 2.9 per cent, that is 366,000 Aussies in November according to the Australian Bureau of Statistics.

The unemployment rate fell by 0.6 percentage points to 4.6 per cent in November, reversing the similar sized increase in October. Unemployment fell by 69,000 people, following an increase of 81,000 in October, as people returned to work.

The large increase in employment saw the national participation rate increase by 1.4 percentage points to 66.1 per cent in November. This was 0.2 percentage points below the peak in May and 0.2 percentage points higher than the start of the pandemic.
 
Company news

Join me for Stocks of the Hour here where I cover the headlines from CSL (ASX:CSL), Woodside Petroleum (ASX:WPL), and Sims (ASX:SIM).

Explosives maker Orica (ASX:ORI) anticipates its financial year 2022 earnings before interest and taxes from continuing operations to increase the same period a year ago.

PointsBet (ASX:PBH) has launched its online and mobile sports betting operations in Virginia as the sports better grows its footprint to its eighth state in the US.

Qantas (ASX:QAN) has been able to accelerate the repair of its balance sheet and expects to finish the first half of FY22 with a materially better net debt position than it had prior to the start of Delta variant lockdowns in June.

Shopping centre giant Stockland (ASX:SGP) expects to pay investors pay 12 cents per share for the six months to the end of December.

MA Financial (ASX:MAF) has exchanged contract to buy Hotel Brunswick and an adjacent property for $68 million.

IPOs

Qualitas (ASX:QAL) has joined the ASX this morning. Their shares issued at $2.50, started trading at $2.55 and are currently at $2.55, and Xpon Technologies Group (ASX:XPN)  as well. Their shares issued at $0.20, started trading at $0.285 and are currently at $0.26.

Best and worst performers

The best-performing sector is information technology, up 1.9 per cent. The worst-performing sector is healthcare, down 5 per cent.

The best-performing stock in the S&P/ASX 200 is Mesoblast (ASX:MSB), trading 12.78 per cent higher at $1.50. It is followed by shares in HUB24 (ASX:HUB) and Lifestyle Communit. (ASX:LIC).

The worst-performing stock in the S&P/ASX 200 is CSL (ASX:CSL), trading 8.13 per cent lower at $273.10. It is followed by shares in Champion Iron (ASX:CIA) and St Barbara (ASX:SBM).

Commodities and the dollar

Gold is trading at US$1778.03 an ounce.
Iron ore is 1.3 per cent higher at US$109.70 a ton.
Iron ore futures are pointing to a rise of 0.45 per cent.
One Australian dollar is buying 71.78 US cents.