ABC Online...The Australian share market is looking for...

ABC Online...
The Australian share market is looking for direction in early trade after the passage of the mining tax through the Senate and mixed leads from markets in Europe and the United States overnight.

At 11:20am (AEDT) the benchmark ASX 200 was flat at 4,289 and the broader All Ordinaries Index has seen a similar result, at 4,379.

Mining shares were seeing modest gains, beating the broader market; BHP Billiton was up 0.1 per cent and Rio Tinto has gained 0.4 per cent. Fortescue Metals was 0.2 per cent higher.

CMC Markets' chief market strategist Michael McCarthy said he did not expect a strong reaction from investors after the passage of the Minerals Resource Rent Tax overnight.

"It seems very unlikely that we'll see any impact; the market has known about this for more than two years," Mr McCarthy said.

"The negotiations occurred with the major companies over a year ago and the shape of this tax has been very well flagged to the market, so it's already been included in the current prices of the resource stocks."

But Mr McCarthy said investors would be rattled by any changes to the rate or scope of the tax.

"The Greens have reserved the right and have included in the negotiations a caveat that there could be further increases in the tax and it may be spread to other minerals rather than just coal and iron ore, and that could affect some of the small companies," he said.

"However, in its current form it kicks in at a profit of $75 million a year. Most of the smaller companies will be under that threshold at this stage."

The big four banks were mixed; Commonwealth Bank and Westpac have dipped slightly while ANZ Bank and NAB both were 0.1 per cent higher.

But retail shares were suffering; David Jones shares remained in a trading halt pending an announcement to the market, while its chief rival Myer was 0.9 per cent lower.

Harvey Norman shares have given up 1.2 per cent and JB Hi-Fi was off 0.5 per cent.

The Australian dollar strengthened against its US counterpart overnight and was worth 106.2 US cents, 88.5 Japanese yen, 66.8 British pence, 80.2 euro cents and $NZ1.29.

West Texas Crude oil was worth $US108.07 a barrel, while Tapis crude oil closed lower at $US135.19 a barrel overnight.

Spot gold also was worth $US1,663.50 an ounce.

Dave R.