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The Australian share market managed to fend off the significant falls seen in global markets Friday to some extent to be only 0.3% lower by noon Monday. Banks and financials were a standout, being the only sector above the gain line.

In economic news, according to the TD Securities/Melbourne Institute monthly inflation gauge prices for goods and services increased by 0.3% in December following a rise of the same amount the previous month.  

Meanwhile, according to a government report Queensland overtook New South Wales as Australia’s second largest exporting state behind Western Australia. The 48% jump in exports from the Sunshine State has been attributed to coal prices and beef exports.

Nationally, exports increased by over 23% to $283.8 billion in FY09, compared with the previous financial year.

At midday, the All Ords was down 16.0 to 4,913.5, while the ASX/200 retreated 13.1 to 4,886.5. About 880 million shares worth around $1.5 billion had changed hands.

The big four banks added the most points to the index. ANZ put on 41c, or 1.8% to $22.84 as speculation surfaced it is set to acquire ING Office Fund for as much as $1.3 billion.

ING Office Fund shares rallied 4.8% to $6.31.

Westpac and NAB rose 20c and 15c to $25.70 and $27.45 respectively.

Meanwhile, CBA edged 20c higher to $58.30 as analysts start raising earnings forecasts for the company predominantly due to strength in one-off items. The company featured heavily in broker reports this morning after raising its post-tax profit forecasts for the six months to 31 December 2009 from $2.7 billion to $2.9 billion on Friday.

AMP was the best of the insurers, up 1.4% to $6.60. The Banks and Financials sector advanced 0.5%.

The Materials and Resources sector dipped 1% as most base metals prices weakened on the LME Friday due to a strengthening greenback.

BHP Billiton lost 54c, or 1.2% to $43.11, while Rio Tinto slid 64c to $77.98.

Citigroup downgraded its rating on Rio to a “hold” as it expects a period of consolidation.

Expectations among analysts are for the major miners to bring in billions of dollars extra profit in coming years due to a strong demand in commodities driving prices higher. 

Lihir Gold added 2c to $3.31 as the nation’s second largest gold producer announced the resignation of Arthur Hood as CEO after more than four years at the helm. The company said chief financial officer Phil Baker has been appointed as interim CEO pending a global search for a new chief executive.

Gold futures dropped 1.1% in the midst of persistent credit concerns in Europe and concerns of an economic recovery.

Metals recycler Sims Metals dropped $1.06, or 4.2% to $24.05.

Macarthur Coal fell 3.3% to $11.01 as UBS downgraded its rating on the stock to “neutral” due to the delay in first shipments of Middlemount Coal.

Energy stocks tracked the price of crude lower, with the sector down 0.4%. NYMEX crude closed at US$78.00 a barrel after its fifth consecutive day of falls.

Woodside and Origin lost 1% and 1.2% to $47.18 and $17.11, while African focussed uranium explorer Extract Resources slumped 3.3% to $8.27.

Arrow Energy climbed 12c, or 2.7% to $4.50.

Industrials weakened 0.3% with Leighton, Qantas and Brambles down 1.5%, 1.7% and 0.9% respectively.

On the other side of the line, Toll and Macquarie Infrastructure gained 2.9% and 3.1% to $9.18 and $1.505.

Merrill Lynch upgraded its rating on Toll from "neutral" to "buy".

Broad based losses sent the Consumer Staples 1% lower. Woolworths fell 24c, or 0.9% to $27.70 and Wesfarmers shed 36c, or 1.2% to $30.69.

A 2.2% gain to $1.82 from media company Fairfax could not stop the Consumer Discretionary sector from weakening 0.5%.

Newscorp lost 26c to $16.94, while retailers David Jones and Harvey Norman, and gamer Tatts Group were between 1% and 1.4% in the red.

Telstra was flat at $3.33 as the Telecommunications sector dipped 0.1%.

Around the region, the Nikkei 225 fell 187.3 to 10,794.8, while the Straits Times Index slid 9.8 to 2,898.6. Meanwhile, the NZSE50 edged 5.2 lower to 3,252.8.

Spot gold was trading at US$1,130.50 per ounce, and the Aussie was buying US$0.9187.

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Lihir CEO Hood resigns
Lihir Gold announced the resignation of chief executive Arthur Hood today. The company said Mr Hood would step down immediately and chief financial officer Phil Baker has been appointed as interim CEO pending a global search for a new chief executive.

At lunch, Lihir Gold shares were up 2c to $3.31.

Djerriwarrh Investments profit halved
Djerriwarrh Investments said its reported profit for the six months to 31 December 2009 had slumped by nearly half to just $15.1 million as companies slashed dividend payouts in the face of the GFC.

At midday, Djerriwarrh Investments shares were up 6c to $4.63.

IRESS enters the Asian market
IRESS Market Technology this morning announced its newly created Singaporean subsidiary IRESS Market Technology (Singapore) Pte Ltd, had purchased SENTRYi as it looks to increase its presence in the Asian wealth management market.

At lunchtime, IRESS shares were down 12c to $8.66 each.

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