Australian shares shrugged off a sharp drop in consumer confidence and falls in Asian equities this morning to reach lunchtime little changed.
At 1pm the ASX 200 was down 4 points or 0.1% at 4189 and trading near its highest level of the day as gains in defensive sectors offset falls in financial and mining stocks.
The market dipped mid-morning after an unexpected downturn in consumer confidence despite this month's interest rate cuts. The WBC-MI index of consumer sentiment dropped 8.3% to 94.7 in December from 103.4 last month.
"News which is likely to have unnerved respondents is the reported increase in the unemployment rate from 5.2 per cent to 5.3 per cent with a loss of 40,000 full time jobs," Westpac chief economist Bill Evans told Fairfax. "Of course, the constant stream of news on developments in Europe is also likely to have impacted respondents, while equity markets were volatile."
Asian markets recorded mild losses after the Federal Reserve's "steady as she goes" monthly monetary statement sparked overnight falls on Wall Street. Japan's Nikkei eased 0.52%, Shanghai 0.3% and Hong Kong's Hang Seng 0.36%. Dow futures were recently down two points or less than 0.1%.
"Nothing came out of the Fed meeting," the portfolio investment group manager at Tokio Marine & Nichido Fire Insurance told Bloomberg. "That's negative for stocks."
Crude oil futures eased 21 cents this morning to US$99.77 a barrel. Spot gold rebounded 50 cents to US$1,634.50 an ounce. The dollar was buying 99.99 US cents.
If anyone wants to know where to place buy orders to capture pullbacks in shares, I delivered a masterclass this morning - placed all but one buy order exactly one pip too low. Add one pip to any of my tips and you'll have the sweet spot. Only fill was in MAPDA, which has recovered nicely. I was a day too early looking for a bottom in MML yesterday but feel happier after today's turnaround. Potential rally from here if gold plays nice and last month's trading pattern repeats.
