Shanghai jitters and slow retail growth douse trading

Nervous investors stampeded from Australian stocks yesterday after the market plunged by more than 1 per cent in response to concerns about a sharp fall on the Shanghai exchange.
The ASX 200 index closed 74.2 points down, or 1.17 per cent lower, to 6243.4 and the All Ordinaries lost 67.1 points to 6271.7. On the Sydney Futures Exchange the June share price index contract fell 62 points to 6263, on a volume of 27,084 contracts.
Yesterday's 6.8 per cent decline on China's Shanghai Composite Index was reminiscent of February's fall, which pushed the Australian market down 2.7 per cent - its biggest one-day fall in more than five years.
China's benchmark stock index tumbled after the Chinese Government raised the stock-trading tax in its strongest effort yet to cool a speculative bull run.
CMC Markets senior dealer James Foulsham said the increased broking charge immediately pushed the Shanghai exchange lower and this flowed to the Australia market.
"They tripled them [the taxes], basically to try and cool the market a little bit over there. The [Australian] market was pretty flat this morning but it reacted to that as well."
The Australian market had a second dose of cold water yesterday when domestic retail sales figures were released.
"When they came out, and they were worse than expected, the market reacted pretty sharply," Mr Foulsham said.
Responding to the Chinese development, the big miners led the market down, Mr Foulsham said.
The world's biggest miner, BHP Billiton, was 63c lighter at $31.07 and rival Rio Tinto slid $1.81 to $94.55.
The spot price of gold in Sydney was $US1 higher at $US656.70 per fine ounce. But the goldminers lost their shine, with Newcrest Mining down 6c to $21.68, Newmont Mining slipping 1c at $4.75, and Lihir Gold decreasing 5c to $3.08.
The banks had also caught the chill, with the big four lenders all weaker. Commonwealth Bank dipped $1.01 to $55.03, National Australia Bank lost 35c to $42.40, ANZ gave up 38c to $28.79 and Westpac surrendered 36c to $26.03.
Most of the retailers were poorer after figures released yesterday showed retail trade rose 0.1 per cent in April, significantly less than the increase of 0.3 per cent forecast by economists.
Australia's biggest retailer, Woolworths, dropped 35c to $27.72 and David Jones lost 8c to $5.14. However, takeover target Coles Group was 3c stronger at $16.68.

In other market news, the airline operator Regional Express Holdings surged to a record close of $2.78, up 39c, after peaking at $2.87.
The carrier, which has a monopoly on many bush routes, had earlier projected a 40 per cent lift in full-year profit.
But Qantas Airways, the most traded stock yesterday, shed 7c to close at $5.66. About 97.60 million Qantas shares worth a total of $558.66 million changed hands.
Aged-care company Primelife Corporation and investment bank Babcock & Brown were both down slightly after announcing they had joined forces to create the largest retirement living company in the country.
Babcock & Brown fell 16c to $31.54 and Primelife lost 0.5c to finish at $1.145.
The telcos retreated, with Telstra giving up 5c to $4.79 and rival Singapore Telecommunications, the owner of Optus, was 8c weaker at $2.75.
Media stocks all suffered, with Publishing and Broadcasting losing 13c to $21.19. News Corporation declined 36c to $28.85 and its non-voting scrip slipped 33c to $27.05.
Total market turnover was 1.73 billion shares, worth $6.57 billion, with 503 stocks rising, 767 falling and 365 unchanged.

Shares make up for last week's losses

The sharemarket burst back into record territory yesterday, recovering all of Friday's losses, with the miners and banks the major movers - as usual.
The ASX 200 index closed 56.5 points higher at 6369, while the All Ordinaries was up 52.8 at 6372.5.
ABN Amro Morgans private client adviser Bill Bishop said the market had benefited from a strong Friday on Wall Street and a rise in commodity prices.
"A very strong performance from the banks in particular. Macquarie Bank is down, but it's just gone ex [dividend].
"St George Bank is up almost 2 per cent. Commonwealth Bank is up, NAB's up. They all had a massive run.
"The miners have had a big day. Commodity prices have risen quite strongly."
Mr Bishop forecast that the markets would continue to trade solidly today.
"It's a reasonable bet … It's a jolly good market. Watch this space, the oceans of cash are lapping at the shores once again."
The bellwether resources stocks performed well. BHP Billiton ascended 47c to $31.18, while Rio Tinto was up $1.38 at $92.29.
Meanwhile, the banks were mostly higher, with the Commonwealth up 80c to $55.43, ANZ up 6c to $29.93, and NAB up 11c to $43.09. However, Westpac fell 3c to $26.97.
St George jumped nearly 2 per cent, up 73c to $37.48, and investment bank Macquarie fell 10c to $97.
Energy stocks were mixed, despite a slight rise in the crude price on Friday.
Woodside fell 2c to $43.30 but Oil Search gained 4c to hit $4, the first time there in nine months. Santos was up 5c at $12.74.
In Perth yesterday Ian Cockerill, the head of the world's fourth largest gold producer, Gold Fields, said the outlook for gold was positive.
Mr Cockerill told delegates at the Paydirt conference that the gold price was trending upwards.
But the local miners showed little of this buoyancy, with Newmont rising just 2c to $4.77, Lihir 7c to $3.23 and Newcrest 4c to $22.24.
The bid for APN News & Media by Tony O'Reilly's Independent News & Media appears to have hit a wall. Major shareholder Perpetual confirmed it would oppose the offer.
APN closed down 20c at $5.78. Perpetual was up $1.06 at $82.06.
News Corp was up 40c to $28.85, the non-voters 45c stronger at $26.85.
Fairfax dropped 4c to $4.93, while PBL dipped 2c to $20.92.
The retailers were in better shape, with Australia's largest grocer, Woolworths rising 49c to $28.71. Rival Coles inched up 4c to $17.70 and upmarket retailer David Jones grew 8c to $5.36.
Telstra fell 1c to $4.85 and the partly paids were steady at $3.39.
And former takeover target Qantas rose 5c to $5.27.
Slater & Gordon made legal and corporate history as the first law firm in Australia to list on a stock exchange. The shares closed at $1.40, 40c higher than the issue price.
The most traded stock of the day was nickel explorer Australian Mines: 168.43 million shares worth $26.8 million traded. It closed up 6.5c at 18c.

Retailers take over from top miners

Retailers buoyed the sharemarket yesterday as big miners tumbled after Wednesday's flurry of takeover talk.
The ASX200 closed 14.5 points higher at a record 6355.5 and the All Ords 13.8 points higher at a record of 6351.8.
The June share price index contract added 39 to 6370.
ABN Amro's private client adviser Bill Bishop said it had been a satisfactory day following the surge when rumours circulated that BHP Billion could make a bid for rival Rio Tinto.
"With [US Federal Reserve chairman] Ben Bernanke holding interest rates [steady] in the US overnight, we got off to a good start, but then things turned pale-faced during the day," Mr Bishop said.
"With the miners, you couldn't say it's off the table but as you can see they are dropped, but that [Wednesday] was a frantic, extraordinary day. I think the market is calming down a bit," he said. "It's back on the simmer plate rather than on the boil."
Rio Tinto ended down $3.62 at $91.88, while BHP Billiton lost 13c at $31.80.
Mr Bishop said the retailers did well, with this week's federal budget proposing tax cuts and family payments, which could make its way into spending at shopping centres.
"The market is saying, 'some of that may find its way into the shops'," he said.
David Jones rose 15c to $4.98 while Australia's biggest shopkeeper Woolworths rose 46c to $28.84.
Takeover target Coles Group gained 8c to $17.80 and Harvey Norman climbed 4c to $5.28.
The banks also provided some support, with ANZ up 15c to $30.80, Westpac 12c to $27.24 and St George 52c to $36.75.
Commonwealth Bank and National Australia Bank both fell. NAB lost 36c to $43.70 despite announcing a 7.1 per cent rise in first-half profit.
"National Australia Bank is back just a bit after a good result, but they are worried about increasing levels of default debts, although I don't think it's anything to worry about," Mr Bishop said.
CBA fell 12c to $54.03.
The goldminers fell, with Lihir dropping 5c to $3.05 and Newmont 8c to $5.04, while Newcrest Mining bucked the trend ending up 4c at $23.20.
The telcos were poorer, with Telstra losing 5c to $4.88 and SingTel 3c to $2.64.
In media, News Corp shed 36c to $28.23 and its non-voting stock 52c to $25.88. Fairfax lost 1c to $5.08 and PBL 3c to $21.72.
Specialty Fashion Group fell 28c to $1.575 after reporting a difficult start to the winter season.
Sims Group rose $1.44 to $26.60 and touched $26.84.
The top traded stock by volume was Metals Australia, with 160.7 million shares worth $14.1 million changing hands. The company has announced significant uranium mineralisation at its Mile 72 project in Namibia.
Its shares rose 2.1c to 9.5c.
Bondi Mining rose 16c to 61c ahead of a trading halt, pending an announcement.
Empire Resources rose 21c to as high as 53c, and closed at 37.5c, after Wednesday's late announcement of high-grade gold intersections at the company's wholly-owned Penny's Find project in Western Australia.

Qantas dominates a down day

The stockmarket pulled back from its record high yesterday, with Qantas going south after the $11.1 billion takeover bid for the airline crashed.
The ASX 200 index closed 31.3 points lower at 6304.4, while the All Ordinaries slipped 28.4 points to 6301.
However, both set new records during the day - the ASX 200 6341.1 and the All Ords 6333.8 points - before the fall.
Macquarie Equities client adviser David Halliday said the big miners and banks had dragged the market down.
"We had a two-speed market today: the BHPs, the Rios and the banks all provided a pretty big drag on the index, while news-specific things like PBL and the Alcan takeover gave it a boost," he said yesterday.
"We have the budget tonight, so the banks might have been a bit weaker on anticipation that the tax cuts might put upwards pressure on inflation.
"The net effect is a down day but it certainly wasn't all bad news."
Qantas opened at $5.22, bottomed out very early at $5.14 then retracked to close as it opened, at $5.22, down 16c, or 2.97 per cent, after Airline Partners Australia conceded defeat.
It was the most traded stock on the market, with 164 million shares changing hands, worth $858 million.
The market got off to a slow start despite a good lead from Wall Street overnight, the Dow Jones industrial average closing up 48.35 at a record of 13,312.97.
Locally, the big miners were weaker, with BHP Billiton dropping 38c to $31.18 and rival Rio Tinto slipping $1.68 to $89.70.
The big banks were weaker as well, with ANZ retreating 5c to $30.53, NAB dropping 23c to $44.32, Westpac shedding 12c to $27.20 and the Commonwealth dipping 32c to $53.95. St George fell 15c to $36.44.
The media sector was mixed, with News Corp gaining 6c to $28.96, its non-voting shares up 3c to $26.83, and Fairfax fell 2c to $5.11.
PBL surged $1.26 to $21.99 after the company said it would split into two separately listed companies to focus on gaming and media respectively.
Engineering and services company United Group retreated 28c to $16.50 despite the company securing $300 million of new work in water, power, transport and defence.
Coca-Cola Amatil shed 3c to $9.38 after it confirmed expectations of high single-digit earnings growth this year, due to a strong performance by its Australasian and Indonesian soft drink markets and its beer business, Pacific Beverages.
The retailers were mixed, with Coles giving up 2c to close at $17.68, Harvey Norman dipping 6c to $5.23 and Woolworths shedding 18c to finish at $27.59. David Jones was steady at $4.86.

Talk of huge mining play stokes market

The stockmarket continued its record run yesterday as reports from market analysts suggesting global miner BHP Billiton could take over rival Rio Tinto sent both stocks surging.
While Rio and BHP shares drove the market upwards, shares in national carrier Qantas remained in a trading halt, pending further announcements in the wake of Airline Partners Australia's failed $11.1 billion takeover bid.
ABN Amro Morgans private client adviser Craig Walker said the market was awash with merger and acquisition talk, with BHP and Rio the main targets of the talk.
"This is the next target, I suppose," Mr Walker said. "Whether or not it happens or whether it's hype is the next big question."
The ASX 200 closed 30.8 points higher at a new closing record of 6335.7, surpassing the 6304.9 set last Friday.
The All Ordinaries was up 33.2 at 6329.4, also a new closing high.
BHP Billiton jumped 96c, or 3.14 per cent, to $31.56, and Rio Tinto strengthened $4.53, or 5.22 per cent, to $91.38.
Citigroup analysts said while Rio's strong cash flow could make it an attractive takeover target for private equity firms, BHP Billiton would be a more likely bidder given the likely synergies. A takeover would cost at least $122 billion.
Woodside Petroleum improved $1.15 to $42.90 but Santos sagged 30c to $12.28.
Macquarie Bank returned to the table with a revised takeover offer for gas and electricity provider Alinta in a bid to trump a rival $7.4 billion offer by a Babcock & Brown consortium.
Alinta was in a trading halt and last traded at $15.25.
Building products producer Rinker Group was up 34c at $19.23 as Mexican cement company Cemex extended its offer for Rinker by three weeks.
Drug maker Peptech dropped 11c to $1.81 and antibody therapeutics company Evogenix soared 16.5c to $1.01 as the two companies announced plans to merge.
The big banks were mixed. National Australia Bank gained 43c to $44.55, Westpac improved 4c to $27.32, the Commonwealth Bank slipped 3c to $54.27, and ANZ retreated 15c to $30.58.
Reluctant bride Bendigo Bank was down 32c to $15.83.
In media, News Corp rose 29c to $28.90 while its non-voters were 40c higher at $26.80.
News Corp has sold its 7.5 per cent stake in rival Fairfax Media for $380 million, after buying the interest last October for $360 million.
Fairfax was down 14c at $5.13 and was the top traded stock by volume, with 84.9 million shares worth $431.5 million changing hands.
Publishing & Broadcasting Ltd was 18c heavier at $20.73.
Telstra nudged up 1c to $4.87, the partly paids up 2c to $3.41, and Optus owner Singapore Telecom eased 3c to $2.75.
Retailer Coles Group lost 5c to $17.70 and Woolworths surrendered 48c to $27.77.
In the golds, Newcrest stepped forward 15c to $23.13, Newmont was unchanged at $5.11, and Lihir Gold rose 9c to finish at $3.10.

Low inflation outlook, high metal prices lift market to record

The sharemarket rocketed to fresh highs, buoyed by solid gains in the resources sectors and an easing in the inflation outlook.
The ASX 200 index rose 59.3 points to a record 6304.9 on Friday, while the All Ordinaries index also gained 59.3 points to 6296.2, also a record close.
On the Sydney Futures Exchange, the June share price index contract was 59 points higher at 6318, on a volume of 15,288 contracts.
CMC Markets analyst David Land said resources stocks were the leaders on the day, with the large miners recording significant gains.
"They have had a strong run at the moment, with a particularly strong run out of BHP and Rio," he said.
BHP Billiton rose 71c to $30.60, while rival Rio Tinto added $3.82 to $86.85.
Mr Land said mid-tier miners also had a good day, with Beach Petroleum jumping 7.5c to $1.33 and Jubilee Mines adding 89c to $17.85.
Gold miners were higher, due in part to a stronger price for the precious metal.Lihir increased 4c to $3.01 and Newcrest jumped 58c to $22.98.
In the energy sector, Oil Search rose 8c at $3.65 after telling shareholders in Port Moresby liquefied natural gas was still a lucrative market, despite the collapse of the proposed Papua New Guinea-to-Australia gas pipeline project.
Woodside rose 75c to $41.75 and Santos was up 28c to $12.58.
Shares in AGL Energy tumbled 17c to $15.45 after Macquarie Bank said it was weighing up a last-ditch bid along with AGL for energy utility Alinta.
Shares in Alinta rose 10c to $15.25, while Macquarie Bank added $1.28 to $91.
The Reserve Bank of Australia on Friday lowered its inflation forecast for the rest of 2007, which improved market sentiment. Underlying inflation is expected to fall to 2.5 per cent or below in the next few quarters from 2.75 per cent.
Elsewhere, banks were mostly higher. CBA rose 45c to $54.30, Westpac 8c to $27.28 and NAB 12c to $44.12. ANZ bucked the trend, easing 1c to $30.73.
St George, was up 3c at $36.60 after reporting a more than 14 per cent lift in first-half profit and upgraded its annual earnings outlook earlier this week.
Qantas closed 1c higher at $5.38. Friday was D-Day for Airline Partners Australia's proposed $11.1 billion takeover offer for the airline.
Condom and glove manufacturer Ansell fell 5c to $11.49 after acquiring Brazil's third largest condom company, Fabrica de Artefatos de Latex Blowtex for an undisclosed sum.

Among media stocks, News Corp fell 15c to $28.61, while its non-voting stock dropped 20c at $26.40. Rupert Murdoch last week launched a $US5 billion bid to buy Dow Jones, owner of The Wall Street Journal and other media assets. Fairfax Media lost 3c to $5.27 while Publishing & Broadcasting Ltd rose 10c to $20.55.
Hutchison Telecom's $2.85 billion capital raising has been given the go-ahead by shareholders, clearing one obstacle in the mobile-phone provider's quest for profitability. Shares in the operator of the 3 mobile network rose 0.5c to 17.5c.
Telstra ended 2c higher at $4.86, while its instalment receipts were flat at $3.39.
Agencies
FRIDAY'S MOVES Rises 751 Falls 494 Steady 386
Jun SPI 6320.0 +61.0
ASX 200 6304.9 +59.3
Financials 7371.2 +54.8
Industrials 7021.0 +27.8
Energy 13634.1 +201.9
Volume Value 1.602bn 5.795bn

Market just keeps getting higher - here, everywhere

The stockmarket closed in record territory again yesterday, though only just.
The ASX 200 index finished up 7.9 points at a record 6245.6, while the All Ordinaries was 12.4 higher at 6236.9.
CMC Markets senior dealer James Foulsham said a strong lead from Wall Street had helped propel the Australian bourse to fresh highs.
"We saw another strong day out of the US. The Dow was up 75 points, so there was a little bit of momentum there," he said.
"The materials sector was relatively strong but finance was holding the market back a bit. BHP and Rio were strong and propping it up.
"We saw people being a bit reluctant to buy into the rallying and [today] we might see a little bit of selling and reducing of positions before the weekend."
The Dow Jones Industrial Average had risen 75.74 to 13,211.88 on Wednesday night and the Standard & Poor's 500 put on 9.62 to hit 1495.92, both record closes; and the Nasdaq was up 26.31 to 2557.84.
Locally, the big miners were stronger and BHP Billiton picked up 13c to $29.89 while rival Rio Tinto added 28c to $83.03.
The banks were mixed. The National Australia Bank gained 19c to $44.00, the Commonwealth picked up 21c to $53.85 and ANZ dipped 5c to $30.74.
Westpac dropped 34c to $27.20 despite delivering an 11.7 per cent lift in first-half profit to $1.641 billion.
St George Bank continues to power on, closing up 32c at $36.57. Bendigo seems to be settling about $16, finishing the day at $15.98, up 4c. Its erstwhile partner, Bank of Queensland, was down 4c to $18.45.
Another Queenslander, Suncorp, was hit, losing 37c to $21.50. It was a bad day for insurers, AMP falling 4c to $10.84 and IAG 7c to $6.13. Axa, though, was up 4c to $7.42.
Telecom New Zealand dipped 5c to $4.35 after it announced a $NZ1.1 billion ($987 million) share cancellation following the $NZ2.24 billion sale of its Yellow Pages group in March.
The telecom reported its net profit for the nine months to March was $NZ690 million compared with a loss of $NZ244 million in the same period a year ago.
The media sector was mixed. PBL gained 15c to $20.45, News Corp put on 19c to $28.76, its non-voting shares picked up 24c to $26.60 and Fairfax Media added 7c to $5.30. West Australian Newspaper Holdings added 4c to $16.69 after delivering an increase in earnings to $81.65 million in the first nine months of this financial year.
The retailers were mixed. David Jones rose 5c to $4.86, Coles shed 10c to $17.62 and Woolworths retreated 17c to $28.28. The women's wear chain, Noni B, has recovered from its warning of a poor second half, closing down 1c at $4.59.
The energy sector was mixed after a drop in the oil price overnight. Woodside gained 62c to $41.00, Santos rose 21c to $12.30 and Oil Search shed 5c to $3.57. Beach fell 1c to $1.255.
The goldminers were mixed. Newmont put on 3c to $5.08, Lihir Gold picked up 5c to $2.97 and Newcrest dipped 20c to $22.40.
Newcomer BC Iron, soared 48c to $1.55 on some good drill results from its Nullagine prospect in the Pilbara, comparable to, it said, Robe River.
Property trust Macquarie ProLogis was the most traded stock on the market with 63.1 million of its shares changing hands. They were worth $89.3 million.
Preliminary market turnover reached 1.7 billion, worth $5.55 billion, with 689 stocks moving up, 556 stocks down and 360 unchanged.

US bounce, miners spur shares higher

The sharemarket resumed its rise to hit new highs yesterday after strong US markets and higher prices for some base metals boosted investor confidence.
CMC Markets market analyst David Land said the major banks and miners had done especially well.
He said the market had been expecting a good day in the materials sector after some good movements in prices for some metals, including copper and zinc, in London overnight.
The banks seemed to be riding on upward momentum after recent good profit results from ANZ Banking Group and St George.
"We also had a good bounce on the Dow," Mr Land said.
He said that the decision by the Reserve Bank of Australia to keep interest rates unchanged had not had a material effect on the market because the decision had largely been anticipated.
The Reserve had left the overnight cash rate target at 6.25 per cent, as high as it has been for a decade.
The ASX 200 index closed 91.9 points, or 1.5 per cent, higher at 6237.7, surpassing the record of 6236.9 set on April 18.
The All Ordinaries was up 84.3 at 6224.5, another record.
The interest rate announcement, which came as no surprise, will increase the focus on the Reserve's quarterly statement on monetary policy, due on Friday.
Among the major banks, the National Australia Bank was 86c higher at $43.81, Westpac 34c richer at $27.54, the Commonwealth up 88c at $53.64 and the ANZ 39c stronger at $30.79.
St George Bank was down 40c at $36.25.
In resources, BHP Billiton gained 61c to $29.76 and Rio Tinto rose $1.60 to $82.75.
Alumina advanced 11c to $7.31 after it said demand for aluminium remained robust and prices were expected to remain firm.
Oxiana was up 9c to $3.09 after it gave an upbeat outlook for commodity prices this year and said it expected to make more acquisitions.
Woodside Petroleum was up 88c to $40.38 and Santos rose 47c to $12.09. Oil Search was up 8c at $3.62.
News Corp fell 56c to $28.57 while its non-voters reversed 84c to $26.36 after Rupert Murdoch launched a takeover bid for Dow Jones, which owns The Wall Street Journal.
Publishing & Broadcasting fell 2c to $20.30 and Fairfax rose 11c to $5.23.
Telstra picked up 9c to $4.85 and Optus-owner Singapore Telecommunications nudged up a penny to $2.70.
Retailer Coles advanced 45c to $17.72 and Woolworths gained 19c to $28.45.
In goldmining, Newcrest was up 15c at $22.60 but both Lihir, at $2.92, and Newmont, at $5.05, were down 1c.
Takeover target Symbion Health was steady at $4.29 as investors considered the possibility of another predator emerging for the pathology, medical centres and drugs company.
The top-traded stock by volume was national carrier Qantas Airways, with 64.8 million shares, presumably from hedge funds baling, worth $345.1 million changing hands. Qantas was 4c higher at $5.34.
Double Bay utility price negotiator Imagine Un Ltd rose 4.5c to 15c on news it was looking to merge with or take over mortgage aggregator The Brokerage Pty Ltd.