Sydney Rallies; Record Home Starts

Chandrasekhar Atreya
15 Sep, 2010
New York City

Stocks in Australia rallied to a four-month high following Japanese intervention to stem the surging yen. Consumer confidence index declined in September. June quarter saw the largest jump of new dwellings in more than six years. Queensland plans to link to hydroelectric energy from Papua New Guinea.

Sydney Rallies; Record Home Starts

[R]6:00 PM Sydney, Australia – Stocks in Australia rallied to a four-month high following Japanese intervention to stem the surging yen. Consumer confidence index declined in September. June quarter saw the largest jump of new dwellings in more than six years. Queensland plans to link to hydroelectric energy from Papua New Guinea.[/R]

Australian stocks consolidated to a four-month high on positive sentiment from Japan after that central bank stepped in to curb the rising yen for the first time in over six years.

The ASX 200 Index in Sydney gained 0.76% or 35 points to close at 4,661.50.

Work started on nearly 45,000 new homes across the country in the quarter ended June, the largest quarterly number of dwellings in more than six years. In the year ended June, home starts rose by 43.8%, the Australian Bureau of Statistics data showed.

Consumer confidence in Australia fell in September, erasing most of the gains in August, according to the Westpac-Melbourne Institute consumer sentiment index. The index fell 5% to 113.2 in September with all of its components falling.

The index measuring expected economic conditions over the next 12 months also fell 7.2% while the expected conditions over the next five years fell by 6.1%.

Skilled job vacancies increased by 0.1% in September compared to August, according to the latest data.

The Department of Education, Employment and Workplace Relations skilled vacancies index was 46.2 points in September, 16% higher than a year ago. The department’s Internet vacancy index rose 5.7% for August to 90.2 points, 17.3% higher than the month a year ago.

Chief executive of AGL, the largest domestic electricity and gas retailer said Wednesday that there is need for a prompt introduction of an emission trading system exclusively for the power generating sector.

National Australia Bank withdrew its $13.3 billion offer for AXA Asia Pacific Holdings, leaving the offer open for AMP or any other contender.

The growth of renewable energy industry in Australia needs more investments to boost large-scale transmission infrastructure and connections to link projects into the grid system.

The Queensland government announced plans for a multibillion dollar project to tap hydroelectric power generated in Papua New Guinea with “negligible carbon emissions.”

Premier Ann Bligh said the Purari Hydro Resource at Wabo, in the Gulf Province of Papua New Guinea, would generate 1,800 megawatts of renewable base load electricity which would be transferred via an undersea cable to Weipa, potentially plugging directly into Townsville as early as 2020.

Origin Energy said Wednesday it will sign an agreement with governments of Papua New Guinea and Queensland to potentially support the development of a large hydroelectric power project on the Purari River in PNG, the nation’s third largest waterway.

Under the 50:50 venture between Origin and PNG Sustainable Development Program, electricity produced would be used to power villages in that country and would be transmitted to Australia via Weipa to join the national electricity grid at Townsville.

The state of Victoria announced Wednesday a A$644 million operating surplus, more than three times the budgeted forecast for 2009-10.

Sydney-based Pengana Capital Ltd said Wednesday it plans to boost its holdings of Japanese equities after that country’s government intervened in the foreign exchange market for the first time since 2004.

Aristocrat Leisure Ltd, the Australian gaming machine manufacturer, will have to pay its bondholders $212 million in damages after a U.S. judge ruled that the company breached its obligations to convert notes to shares.

Resource News

CGA Mining announced Wednesday morning it achieved record throughput of ore from its Masbate Gold Project in the Philippines.

Resource Generation, which has a project in South Africa, signed an off take agreement and a A$10.5 million share placement with a subsidiary of India’s RPG Group.

Metal X said it is in talks with potential Chinese partners, including its major shareholders, over financing and development of it’s A$2.3 billion Wingellina nickel project on the WA-SA-NT border.

Gainers & Losers

Roc Oil Company Ltd led the gainers in the ASX 200 with a rally of 5.26% to A$0.400 followed by Platinum Australia Ltd 4.9% to A$0.75 and Iress Market Technology Ltd 4.77% to A$8.34.

Sundance Resources Ltd led the decliners in the index with a loss of 7.55% to A$0.245 followed by Biota Holdings Ltd 2.94% to A$0.99 and Carnarvon Petroleum Ltd 2.44% to A$0.400.