The Australian sharemarket is lifting higher this morning following another record day on Wall Street. At noon, the S&P/ASX 200 is 0.6 per cent or 46 points higher at 7,474. The SPI futures are pointing to a rise of 58 points.
Across the sectors, 9 out of 11 are in the green. Communication services are adding the most points, up 1.9 per cent, followed by real estate, up 1.1 per cent, utilities, up 1 per cent, and materials, up 0.9 per cent. Technology is the lowest, down 0.7 per cent, with energy, down 0.3 per cent.
The best-performing stock in the S&P/ASX 200 is Link Administration (ASX:LNK), trading 10.4 per cent higher after receiving a non binding takeover offer from Carlyle Asia Partners. The worst-performing stock in the S&P/ASX 200 is Clinuvel Pharmaceuticals (ASX:CUV), trading 15.7 per cent lower.
In company news, real estate advertiser REA Group (ASX:REA) is up 7.2 per cent following its September quarter results, with revenue up 22 per cent. News Corp (ASX:NWS) is also up 9.9 per cent, following its quarterly results. Keep an eye out for a story this afternoon.
Heavyweight miners are steady, with Rio Tinto (ASX:RIO) up 1.4 per cent, Fortescue (ASX:FMG) up 1.6 per cent and BHP (ASX:BHP) up 0.9 per cent, as iron ore prices trade flat. Gold miners Newcrest Mining (ASX:NCM) and Northern Star Resources (ASX:NST) are up 3.3 and 5 per cent.
Major banks are up, led by NAB (ASX:NAB) up 1.1 per cent. Westpac (ASX:WBC) has been volatile this morning after trading ex-dividend today, up 0.1 per cent at lunchtime.
Meanwhile, energy stocks are lower, with Woodside Petroleum (ASX:WPL) down 1.7 per cent. Buy now, pay later giant Afterpay (ASX:APT) is down 2.9 per cent after shareholders in US voted in favour of the $39 billion acquisition with Square.
Local economic news
The Reserve Bank released the quarterly Statement on Monetary Policy. Conditions are in place for a sustained global recovery. Global goods demand has remained strong even as services activity rebounds. This has strained global supply chains and logistics networks, as have disruptions to supply in some sectors.
In Australia, the recovery from the Delta outbreak is also underway. The setback to the economy from this outbreak was significant; GDP is expected to have contracted by around 2½ per cent in the September quarter, and hours worked declined by 3 per cent.
Australia has experienced some of the same upward pressure on prices as seen globally, but to a much lesser extent. The factors pushing up non-oil energy prices in some other economies are less relevant here. Labour supply has recovered quickly, which has meant less upward pressure on wages, and it will expand further as the borders reopen.
Inflation was higher than expected in the September quarter. Headline inflation was 0.8 per cent in the quarter and 3 per cent over the year. Underlying inflation was 0.7 per cent in the quarter and 2.1 per cent over the year. About two-thirds of the quarterly increase in headline CPI was accounted for by sharp rises in two components: petrol prices; and home-building costs
The outlook is for underlying inflation to pick up gradually over the next couple of years, as the economy recovers further and spare capacity is absorbed. In the central scenario, trimmed mean inflation is forecast to be 2¼ per cent at the end of 2022 and around 2½ per cent by the end of 2023.
Meanwhile, the Australian Industry Group released the Australian Performance of Services Index, which rose by 1.9 points to 47.6 points in October 2021. This marked a third month in decline in 2021, following a strong recovery in conditions earlier in the year. Results below 50 points indicate contraction in the Australian PSI®, with lower numbers indicating a stronger contraction
Online real estate advertiser REA Group (ASX:REA) has recorded revenue excluding acquisitions of $264 million for the September quarter, up 22 per cent year-on-year driven by an increase in free cash flow and national listings.
Funds management group Pendal (ASX:PDL) has reported an increase in profit for the 12 months ending 30 September 2021, driven by growth in revenue and funds under management (FUM).
Superannuation admin industry Link Administration (ASX: LNK) has received a non-binding takeover proposal from Carlyle Asia Partners, an investment fund managed by the Carlyle Group.
Best and worst performers
The best-performing sector is Communication Services, up 1.9 per cent. The worst-performing sector is Information Technology, down 0.7 per cent.
The best-performing stock in the S&P/ASX 200 is Link Administration Holdings (ASX:LNK), trading 10.4 per cent higher at $4.78. It is followed by shares in News Corporation (ASX:NWS) and REA Group (ASX:REA).
The worst-performing stock in the S&P/ASX 200 is Clinuvel Pharmaceuticals (ASX:CUV), trading 15.7 per cent lower at $34.21. It is followed by shares in Virgin Money UK (ASX:VUK) and Afterpay (ASX:APT).
Commodities and the dollar
Gold is trading at US$1794.20 an ounce.
One Australian dollar is buying 73.96 US cents.
Iron ore is flat at US$99.70 a ton.
Iron ore futures are pointing to a fall of 2 per cent.