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Aussie market despite China concerns

The ASX 200 recovered in late trade despite downbeat data on China’s economy.

The index rose by 27.4pts or 0.42 per cent to 6595.5, which was enough to recoup Tuesday’s modest losses, reports CommSec.

 Investors were encouraged by US plans to delay a 10 per cent tariff on around US$160bn of Chinese goods by three months to mid-Dec in a bid to keep prices lower over the holiday season.

 “The monthly updates on China’s economy were all lower than expected today which weighed on the market at lunch. Retail sales rose at a 7.6 per cent annual rate in the year to July, down from 9.8 per cent in June. Chinese industrial production rose at a 4.8 per cent annual rate in July – the slowest growth in 17½ years.

 “Gold stocks slumped today while CBA, Suncorp (SUN) and Scentre (SCG) fell heavily after trading ex-dividend.”

 · The highly anticipated figures on wages growth was released earlier in the day and was a touch above market consensus. Wages rose by 0.6 per cent in the June quarter while annual wages growth was steady at 2.3 per cent and was near a 4.5 year high. Tomorrow’s data on the labour market will be a highlight.

· It was a busy day for company profit reports, with CSL, Tabcorp (TAH), Computershare (CPU), Aveo (AOG) and Vicinity Centres (VCX) among the larger stocks to post earnings. National Bank (NAB) posted a 1 per cent lift in quarterly cash profit to $1.65bn

. · Blood products company CSL Ltd (CSL) posted an 11 per cent lift in full year profit to US$1.92bn and a 7.9 per cent increase in revenue to US$8.53 billion. CSL has rallied strongly reaching a new all-time high of $235.66 this morning.

 · Tabcorp Holdings (TAH) announced a 46 per cent lift in revenue to $5.5 billion in its first full year of combined operations with Tatts Group. The result was boosted most by its Lotteries division which is now its biggest earner and was thanks partly to an unusually large number of jackpots over $15m.

· Aveo Group (AOG) received a Scheme Implementation Deed by Brookfield Property. If the scheme is implemented AOG shareholders will be entitled to receive total cash of $2.195 per security for the takeover. AOG shares surged by 5.5 per cent.

· Iron ore fell another 6.6 per cent overnight to $88.50 however this did not adversely impact our miners. Fortescue Metals (FMG) rose by 4.7 per cent, Rio Tinto (RIO) jumped by 2.5 per cent and BHP gained 1.1 per cent.

· 2.9bn shares were traded today worth a well above average $7.5bn. 604 stocks rose, 530 fell and 385 finished unchanged.


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