The Australian share market retreated this morning but pared losses as solid Chinese growth and local takeover action soothed investor nerves.
At lunchtime the ASX 200 was down 12 points or 0.3% at 4449 but well off the morning low of 4427. Industrials led the morning rises, up 2.1%, ahead of utilities +0.9% and IT +0.3%. The financial and mining sectors both lost ground.
The market rallied sharply at noon after Chinese economic data came in broadly as expected. GDP slowed to 11.1% from 11.9% in the first quarter, pointing to a second-quarter growth rate of around 10.5%, in line with economists' predictions. Retail sales rose 18.2% in the first half, compared to a year ago.
"The economy has exhibited good momentum and has continued to move in the expected direction," China's National Bureau of Statistics said in a statement quoted on Fairfax websites.
Earlier, Intoll shares surged 30% after the toll road owner received a $3.5 billion takeover offer from a Canadian superannuation investment board.
Recent turbulence in the stock market has undermined investor confidence, according to data released this morning. The quarterly ING Investor Dashboard Sentiment Index showed a sharp fall in the last quarter.
"The ongoing volatility in the Australian equity market has had a big effect on investor confidence and we expect many to retreat to the sidelines for the remainder of the year," ING Investment Management deputy chief executive Martin Donnelly said in a statement quoted on Fairfax websites.
Asian markets were mostly lower. Japan's Nikkei slid 1.03%, Shanghai 0.12% and Hong Kong's Hang Seng was off 0.03%. Dow futures were recently at +31.
The spot gold price rallied $4.30 this morning to $1212.70 an ounce. Crude oil futures edged 7 cents higher to $76.83 a barrel. The Aussie dollar was down against the major currencies, but jumped after the release of the Chinese data, recently buying 0.8832 U.S. cents, down 0.1%.
Feeling my way back into the market and feeling as rusty as the Tin Man in a rain-storm. Thought CSL looked overdone in the low 32.70s. Expected more volatility in NUF - holding from around these levels. Took profits on BUR from early last week after this morning's announcement.
