Australia Stocks Fell; Retail Sales Rise

Chandrasekhar Atreya
31 Aug, 2010
New York City

The benchmark index in Australia fell more than 1% ignoring positive economic data and tracked losses in Japan and international markets. Retail sales and building approvals rise in July. Gross operating profits at companies rises in second quarter. Perth records the second driest winter on record.

[R]6:00 PM Sydney, Australia – The benchmark index in Australia fell more than 1% ignoring positive economic data and tracked losses in Japan and international markets. Retail sales and building approvals rise in July. Gross operating profits at companies rises in second quarter. Perth records the second driest winter on record.[/R]

Shares in Sydney fell as Japan plummeted despite a positive retail sales data with all sectors but healthcare falling into negative territory.

The ASX 200 Index dropped 1.09% or 48.50 to close at 4,404.20.

Retail sales rose in July at the fastest pace in four months, suggesting that consumer spending maybe starting to play a bigger role in the Australian economy.

Treasurer Wayne Swan said a range of upbeat data released Tuesday showed that the Australian economy is in a strong position, despite global uncertainty.

Tuesday data showed a sharp rise in company gross profits in the second quarter. Details of retail spending and building approvals in July were also stronger than expected.

Company gross operating profits rose 18.9% to a seasonally adjusted A$68.46 billion in the second quarter of 2010, from the previous quarter, the Australian Bureau of Statistics said Tuesday.

New rail stations, 200 kilometer of additional lines and high-speed, European style trains are part of a new 20-year plan for Southeast Queensland. Premier Anna Bligh told MPs Tuesday that the southeast’s passenger rail capacity would nearly triple by 2031 under a new $123 billion transport blueprint.

At the center of it all is the Cross River Rail project, with a new rail crossing of the Brisbane River and new stations, including an underground city station, to boost capacity into the city.

South-Africa focused Gold One International reported a net loss of $3.94 million in the first half and so lowered September quarter production guidance. It said the losses were lower on the increase in mining output at its Modder East gold mine.

Perth recorded its second driest winter on record, for a very sunny winter and record low temperatures. The rainfall for the three months from June 1 was 256.4 mm, the driest since 230.4 mm was recorded in 2006, Western Australia’s Bureau of Meteorology said Tuesday.

Australian home prices were broadly flat in major cities in July while prices outside the main cities declined slightly, industry data showed Tuesday.

A strike at Rio Tinto-BHP Billiton titanium joint venture in South Africa shut down operations, while a wage strike at Exxaro entered its second week with no talks in sight, a union said Tuesday.

Qantas Airways Ltd said passenger count climbed 9.1% in July from the previous year’s July. Revenue per seat factor fell in July to 82.5% down 0.4% while international yield increased by 11.4%. Qantas said it has hedged 56% of its balance fuel requirement in 2010-11 assuming the worst case scenario of $87.80 per barrel, including option premium.

Resource News

Aussie Q Resources confirmed finding increasing copper grades from its new drilling at the Greater Whitewash project in central Queensland.

Doray Minerals extended the depth of drilling of the Wilber lode at Andy Well in Western Australia by more than 50 meters, for a 50% increase.

Philippines-focused energy explorer Peak Oil and Gas took a major step towards its $55 million IPO after it secured $10 million in pre-IPO commitment.

BHP Billiton said Tuesday it offered Japanese steel mills coking coal at $215 a ton for the quarter October to December, down from the price of $225 in this quarter.

Gainers & Losers

Newcrest Mining Ltd led the gainers in the ASX 200 with a rise of 3.44% to A$37.25 followed by Southern Cross Media Group Ltd 3.11% to A$1.825 and Virgin Blue Holdings Ltd 2.99% to A$0.345.

Isoft Group Ltd led the decliners in the index with a drop of 15.15% to A$0.14 followed by Carnarvon Petroleum Ltd 6.94% to A$0.335 and St Barbara Ltd 5.8% to A$0.325.