Conusmer Confidence Up in Australia

Darlington Musarurwa
14 Apr, 2010
New York City

Australian stocks closed higher on the back of a rebound in commodities and metals prices. Australia

[R]3:00 AM New York, 7:00 PM Sydney – Australian stocks closed higher on the back of a rebound in commodities and metals prices. Australia’s consumer confident drops 1% in April. The anti-trust regulatory agency approved the Shell-PetroChina joint bid for coal-seam field developer Arrow Energy Ltd.[/R]

The Australian share index rose 0.9% after consumer sentiment fell less-than-forecasted in April according to a private report.

Commodity stocks also helped lift the market as gold prices jumped 0.4% to $1,157 an ounce and crude oil prices increased 0.4% to $84.40 a barrel.

In Sydney trading the ASX 200 Index edged up 0.9% or 43.1 to 4,994.70.

Of the ASX 200 index stocks, 125 advanced, 57 dropped, and 18 were unchanged. Murchison Metals led gainers in the index shares.

Other commodity stocks gained. Sundance Resources 3.3% to A$0.16 and Iluka Resources climbed 2.9% to A$4.92.

The Australian dollar gained 0.3% to 93.21 U.S. cents.

Consumer Sentiment Falls 1% in April

The Westpac–Melbourne Institute Consumer Sentiment Index fell by 1% to 116.1 in April from 117.3 the previous months despite a second straight increase in the standard variable rate of 0.25%.

Confidence of tenants dropped by 3.8%; of those wholly owning their houses by 1% while confidence of those who hold a mortgage rose by 0.2%.

According to the report, 83% of the respondents expect house prices to rise over the next year from 32% in May last year.

However, petrol prices increased 2.8% and share prices edged up 3.8%, while the Australian dollar jumped 2.8%.

Index of expected economic conditions over the next twelve months advanced 1.3% and the index of expected economic conditions over the next five years climbed 0.7% and an index on whether now is a good time to buy a major household item gained 1.5%.

Reserve Bank of Australia is expected to raise interest rates at its next meeting on May 4.

Westpac''s Chief Economist, Bill Evans said “It is reasonable to conclude that from the perspective of the index the rate hikes have not started to impact on the confidence of the Australian consumer.”

ACCC Approves Shell-PetroChina''s Arrow Energy Bid

Australia’s competition regulator, the Australian Competition and Consumer Commission announced that it will not block the proposed A$3.44 billion acquisition of coal seam gas developer Arrow Energy by a joint venture between Royal Dutch Shell and PetroChina.

ACCC notes that the deal is unlikely to negatively impact on competition on the domestic wholesale market.

ASX Movers

SMS Management & Technology Limited led decliners in the S&P ASX 200 index with a loss of 3.4% followed by losses in Macarthur Coal Limited of 2.5%, in Hills Industries Limited of 2.4%, in IRESS Market Technology Limited 2.3% and in Energy Resources of Australia Ltd 2.2%.

Murchison Metals Limited led gainers in the S&P ASX 200 index with a rise of 5.6% followed by gains in CuDeco Limited 5.3%, in Sigma Pharmaceuticals Limited of 4.8% and in FKP Property Group of 4.0%.

Other Movers

BHP Billiton plc added 0.2% to A$43.94 and the planned $116 billion iron ore joint venture between Rio Tinto plc and the company is facing mounting opposition from governments and the global steel industry, the Australian Financial Review said.

Commonwealth Bank of Australia the lender advanced 1.8% to A$59.20.

David Jones Limited the department store operator gained 2.1% to A$4.67.

National Australia Bank Limited climbed 1.6% to A$27.99.

Telstra Corporation Limited decreased 0.3% to A$3.18.