Australian Dollar Firm; QR National IPO

Chandrasekhar Atreya
20 Sep, 2010
New York City

Australian stocks traded lower as the dollar climbed and metals prices increased. Reserve Bank of Australia outlook suggested continued current growth in the economy in the near future. The rail network, QR National started its public offering that may raise as much as A$7 billion.

[R]6:00 PM Sydney, Australia – Australian stocks traded lower as the dollar climbed metals prices increased. Reserve Bank of Australia outlook suggested continued current growth in the economy in the near future. The rail network, QR National started its public offering that may raise as much as A$7 billion.[/R]

Australian stocks traded lower as the dollar climbed against the U.S. dollar and commodities traded at elevated prices in New York and London. Weaker-than-expected U.S. consumer sentiment also dragged trading sentiment. The stocks pared losses after the upbeat commentary from the RBA about the nation’s robust economy.

The ASX 200 Index lost 0.16% or 7.6 to close at 4,631.30.

Australia’s dollar climbed to a two year high against the greenback after central bank governor Glenn Stevens signaled rates may need to rise should a mining boom stoke the economy next year boosting inflation.

The committee tasked with finalizing the details of the federal government’s controversial mining tax, met for the first time in Canberra on Monday.

The two-day meeting of the Policy Transition Group, headed by Resources Minister Martin Ferguson and former BHP Billiton Chairman Don Argus, aims to finalize the consultation process before meeting with the mining groups in the coming weeks.

Resource Minister Martin Ferguson said Monday that mining companies and unions must immediately write a minimum 12% superannuation component into any agreements in the booming sector.

The Queensland government initiated Monday the initial share sale of its coal freight network, an offering that may be as large as A$7 billion, the country’s largest since Telstra Corp in 2006.

“QR National is a growth story-it is Australia’s largest rail freight company and the world’s largest rail transporter of coal from mines to ports for export markets,” Treasurer Andrew Fraser said in Brisbane Sunday at a pre-registration for retail investors.

The South Australian government announced that state royalties will rise from 3.5% to 5% and this may hit many projects including BHP Billiton’s Olympic Dam expansion project.

Private equity firms KKR and TPG are considering a plan to bid for the Foster Group’s wine business. The offer will need to exceed offer from Cerberus between $2.3 billion to $2.7 billion.

Australians are turning to high-speed internet in numbers and nearly half the population stays online, according to the latest figures from internet service providers of the country.

At the end of June 2010, there were 9.6 million active internet subscribers in the country and nearly 92% of those were non dial-up connections, according to data collected by the Australian Bureau of Statistics’ Internet Activity Survey.

Brown Energy of Australia arranged a loan facility of $10 million for an increase of $2 million from Bhushan Steel (Australia) Ltd.

Adelaide Energy said Monday it was granted a gas storage retention license GSRL 27 by the South Australian government for an area of 45 square kilometers.

Resource News

Maverick Drilling & Exploration said Monday it acquired an ‘oil and gas’ lease covering 1,625 net acres for mineral interests ranging from 25% to 100% across 5,114 acres on the Boiling Dome field of Texas Oil and flanking those acreages.

Toro Energy Ltd is closer to developing the Western Australia’s first uranium mine after the state’s Environmental Protection Authority approved the scoping document of the company’s Wiluna project.

Metallica Minerals Ltd said Monday its scoping study had deemed its $132 million Norinco nickel, cobalt and scandium project, northwest of Townsville as economically and technically feasible, and that it planned to be in production by 2013.

Outback Metals said Monday it received assay results from sampling carried out last month on the Wingates Gold Project, 250 kilometers south of Darwin.

Gainers & Losers

Perseus Mining Ltd led the gainers in the ASX with a gain of 8.33% to A$3.25 followed by Linc Energy Ltd 5.57% to A$1.895 and Fleetwood Corp Ltd 5.54% to A$11.05.

Sundance Resources Ltd led the decliners in the index with a fall of 4.08% to A$0.235 followed by TPG Telecom Ltd 2.84% to A$1.885 and Primary Healthcare Ltd 2.65% to A$3.10.