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Aussie shares edged higher by midday Tuesday after a mixed lead from global markets and economic data overnight. Sectors moved either side of the gain line, with telecommunications being the standout performer. 

At noon, the All Ords had added 4.9 to 4,804.3, while the ASX/200 gained 7.4 to 4,791.5. Over 1 billion shares worth around $1.7 billion had changed hands.

Miners resisted a weakening in metals prices in London as the Materials and Resources sector advanced 0.2%.

Metals prices lowered as concerns tightening of Chinese monetary policy would hamper China's metals consumption.

Rio added 9c to $75.47 after saying, in its 2009 Annual Report, it expects economy wide inventory rebuilding in the OECD to provide a short-term boost to activity.

Media reports surfaced today suggesting Rio is in talks with Aluminum Corp. of China about jointly developing the US$12 billion Simandou iron ore project in Guinea.

BHP Billiton rose 9c to $42.66.

Lihir tracked the price of gold higher, with a 7c, or 2.4% gain to $3.04.

Junior miner CBH Resources was in trading halt as it announced it had received a takeover proposal to rival that offered by Nyrstar NV last week.

Steelmakers Bluescope and Onesteel put on 1.4% and 1.7% to $2.80 and $3.67 respectively.

The Energy sector dipped 0.8% after crude futures almost reached two week lows due to caution regarding the economic outlook.

Heavyweight Woodside lost 22c to $44.77, while Origin shed 1.5% to $16.21.

Arrow Energy edged 2c higher to $5.27 as speculation mounts that the company will reject Royal Dutch Shell and PetroChina’s joint takeover offer as early as today. However, Arrow did say today it was still in “active” discussion with the joint bidders.

Meanwhile, Liquefied Natural Gas announced that it has extended and modified its previously announced Heads of Agreement for the sale of the Fisherman's Landing project to Arrow Energy, as the company possibly looks for alternate partners.

LNG shares were 9.8% higher at 56c.

Uranium miner Paladin gained 10c to $3.78 as it remains favoured by Citigroup for long-term upside in the uranium market.

A 0.2% rise from the Bank and Financials reflected an uneventful mornings trade within the sector.

Of the big four, Westpac was the best performer, up 22c, or 0.8% to $26.85.

NAB retreated 8c to $26.75.

Insurer IAG put on 7c, or 1.8% to $4.03.

A mixed morning from Property Trust stocks saw the sector 0.1% lower.

Stockland dragged to be down 6c, or 1.5% to $3.90, while Dexus gained 1.3% to 81c.

The Industrials sector was helped 0.4% higher by the performance of three stocks.

UGL rallied 4.7% to $15.09 after Goldman Sachs JBWere upgraded its forecast on the stock to “buy”. The broker said UGL is set to benefit from higher than expected economic growth and capex spend.

Brambles and Toll added 2.1% and 1.4% to $7.36 and $7.10 respectively.

Consumer Staples was flat. Wesfarmers lost 17c to $31.53, while Woolworths was 5c dearer at $28.26.

Losses from a few of the sub-sector majors dragged the Consumer Discretionary sector 0.5% below the line.

Retailer Billabong shed 2% to $10.32 and gamer Aristocrat fell 2.3% to $4.31.

Ten Network lost 2.9% to $1.81, while rival Seven’s shares were halted ahead of the release this afternoon of the scheme booklets related to its proposed merger with WesTrac.

Newscorp bucked the trend, adding 21c, or 1.2% to $18.22.  

Telstra rose 6c, or 2% to $3.10. The Telecommunications giant announced the completion of a 10-year benchmark €1 billion Eurobond issue today. The company said issue proceeds would be used mainly for retiring shorter-term bank debt and for general working capital purposes.

Telecom dropped 1.2% to $1.69 after saying the New Zealand government’s rural broadband plans that were originally set out in September 2009 would adversely impact the company’s EBITDA guidance for the next three financial years by up to $56 million if they are enacted.

The sector gained 1.9%.

Around the region, the Nikkei 225 lost 15.3 to 10,736.7, while the NZSE50 fell 13.1 to 3,218.0. The Straits Times Index gained 5.9 to 2,880.3. 

Spot gold was trading at US$1,109.00 per ounce, while the Aussie was buying US$0.9130.

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Rio forecasts short-term increase in activity
Rio Tinto expects economy wide inventory rebuilding in the OECD to provide a short-term boost to activity. The mining giant’s comments followed the IMF’s predictions of global growth of almost 4% and Chinese GDP growth of between 9% and 10%.

At midday, Rio shares were up 10c to $75.48.

Acrux inks licensing deal with Eli Lilly
Aussie pharmaceutical company, Acrux said it had entered an agreement with US giant Eli Lilly to commercialise its male testosterone replacement drug, AXIRON. Under the terms of the deal, Acrux said it was in line to receive up to US$335 million in milestone payments, plus royalties on worldwide sales.

At noon, Acrux shares were up a modest 4c to $2.42.

LNG and Arrow redraw agreement
The board of Liquefied Natural Gas said that it has extended and modified its previously announced Heads of Agreement for the sale of the Fisherman's Landing project to Arrow Energy. LNG said the redrawn agreement came at the request of Arrow Energy, while the takeover offer and other uncertainties around ownership of the company play out.

Half way through the day, Arrow shares were trading up 3c to $5.28 per share, while LNG shares were trading up 5c to 56c.

Telstra completes 1bn euro bond issue
Telstra Corporation announced the completion of a 10-year benchmark €1 billion Eurobond issue, with a 4.25% annual coupon and a maturity of 23 March 2020. The company said the bond was about six times oversubscribed with an order book comprising almost 300 individual orders from a wide range of high quality fixed income investors, including fund managers, insurance companies and banks.

By midday, Telstra shares were trading up 7c to $3.11.

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