NAB survey shows business conditions up; JB Hi-Fi signals sales lift: Midday Roundup

Business conditions in December 2013 jumped to a 2.5-year high, up seven points to +4 index points, according to the NAB Monthly Business Survey.

It found confidence was broadly unchanged, consistent with long-held average levels.

“Confidence has remained surprisingly elevated following the post-election jump, and could potentially remain at these levels for longer than previously thought given that the conditions index has begun to respond,” the report said.

Sales and profits were up sharply, notably in wholesale, transport and services. Manufacturing and construction were exceptions to this trend.

The report found that the employment index was better but the job market was still flat.

It said soft forward indicators question whether the lift in conditions will be sustained.

JB Hi-Fi signals sales lift

Retailer JB Hi-Fi has flagged a first-half sales lift, causing shares in the company to jump 7.16% in morning trade.

In a statement to the ASX, JB Hi-Fi said its sales had lifted 6.8% from the previous corresponding quarter, up from $1.82 billion to $1.94 billion.

Net profit after tax was expected to be up 10%, compared to the first half of the last financial year, to $90.3 million.

For the rest of the year, JB Hi-Fi maintained its previous guidance of sales growth between 6% and 8%.

Shares drop on open

Australian shares plummeted on open, but have since rebounded slightly following positive economic news of business conditions lifting to a 2.5 year high.

The S&P/ASX200 benchmark is currently 43.3 points lower at 5197.6 at 12:11pm AEDT. It opened 79.6 points down, initially wiping more than $22 billion off the market’s value.

Overnight on Friday the Dow Jones closed 41.23 points lower, down 0.26% to 15,837.88.