Sydney Gains 1%; Jobless Rate Drops to 5.1%

Chandrasekhar Atreya
09 Sep, 2010
New York City

Stocks in Australia gained after a report showed unemployment fell to its lowest level since January 2009. Competition authorities once again rejects NAB

[R]6:00 PM Sydney, Australia – Stocks in Australia gained after a report showed unemployment fell to its lowest level since January 2009. Competition authorities once again rejects NAB’s AXA bid. New parliament session will start on September 28.[/R]

Australian stocks traded higher at noon led by strength across the banking and finance sectors after jobless rate fell to 5.1%. Australian Competition and Consumer Commission again rejected NAB’s bid for Axa Asia Pacific.

The ASX 200 Index gained 0.99% or 45 to close at 4,582.20.

Australian economy created more full-time jobs in August from a year ago, pushing the unemployment rate to 5.1%.

Employers added 30,900 workers in August with the jobless rate matching the lowest level since January 2009, the statistics bureau said in Sydney today. But participation rate, which measures the labor force as a percentage of the population aged over 15, fell to 65.4% in August from 65.5% in July today’s report showed.

The Australian dollar rose above 92 U.S. cents after unemployment rate declined from an unrevised 5.3% in July.

The local currency gained almost half a U.S. cent to 92.29 cents immediately after the Australian Bureau of Statistics released data that showed full time employment rose by 53,100 in August.

Santos said it sold a 15% stake in its Gladstone LNG project to a French group for a total consideration of $650 million.

Canada’s Anatolia Minerals Development has agreed to buy Australia’s Avoca Resources for $1.04 billion thus creating a new intermediate gold miner focused on projects in Turkey and Australia.

Takeover target Aevum Ltd said it is considering a merger with a subsidiary of FKP Property Group as an alternative to Stockland’s takeover bid.

ArcelorMittal, the world’s largest steelmaker and BHP Billiton scrapped a plan to combine their iron ore assets in West Africa after their talks failed in the final stages.

The Australian Competition and Consumer Commission on Thursday said it again rejected the offer of A$13.3 billion by NAB for Axa Asia Pacific noting that deal details didn’t adequately address the commission’s concerns.

The consortium of 10 coal miners wanting to buy Queensland’s coal rail network is yet to receive approval from ACCC for A$5.1 billion offer. It looks as if QR National may list as an independent company after the consortium walked away from the sale process.

Australia’s new parliament will have its first session on September 28, Labor Party caucus spokesman Anthony Albanese told reporters in Canberra today.

New U.S. laws on governing financial markets are a concern because they could concentrate power in the hands of a small number of players, a senior Australian central banker said.

Reserve Bank of Australia’s Assistant Governor Guy Debelle also said that conditions remained fragile on financial markets but have improved since late 2008 and early 2009.

Resource News

Eurogold said it has agreed to buy 59% stake in Brinkley Mining, the stake it does not already own, in a deal valuing the target at about $7 million.

Emerging iron ore developer Giralia Resources announced a resource upgrade at its joint venture Daltons-Mount Webber Deposit to 35.1 million tons of indicated and inferred resources.

Oil and gas producer Beach Energy said it is keen to raise capital for the huge shale gas potential it has on offer in outback Australia.

A team from the Anglo-Australian miner Rio Tinto is in Russia seeking a possible stake in potash producer Uralkali, as competition for the crop nutrient heats up.

Gainers & Losers

Sundance Resources Ltd led the gainers in the ASX 200 with a rally of 18.92% to A$0.22 followed by Eastern Star Gas Ltd 7.65% to A$0.915 and Murchison Metals Ltd 5.57% to A$1.515.

Santos Ltd led the decliners in the index with a fall of 6.98% to A$12.78 followed by Axa Asia Pacific Holdings Ltd 6.62% to A$5.08 and Telecom Corp of New Zealand Ltd 5.07% to A$1.59.