Sydney Gains 1.7%; Overseas Travel Boom

Chandrasekhar Atreya
06 Oct, 2010
New York City

Australian shares soared today pushing the benchmark index to its five-month high led by miners and bankers. There were more overseas travelers in the year to August helped by the stronger dollar. Queensland premier plans to push for import of hydrocarbons from Papua New Guinea next week.

[R]6:00 PM Sydney, Australia – Australian shares soared today pushing the benchmark index to its five-month high led by miners and bankers. There were more overseas travelers in the year to August helped by the stronger dollar. Queensland premier plans to push for import of hydrocarbons from Papua New Guinea next week.[/R]

Shares in Australia soared to five-month high led by bankers and miners on the back of expectations central banks around the world would soon stimulate markets.

The ASX 200 Index rallied 1.73% or 79.90 to close at 4,686.80 and the Australian dollar closed at 97.68 U.S cents.

Australian Bureau of Statistics showed today that there were more travelers in August as compared to the same month of 2009. The increase was 10.6% for August and for the year to August, there was a 15.3% rise in departures.

The number traveling overseas in the 12-month period outstripped arrivals by 1.1 million up from less than 500,000 a year ago. The strong dollar lifted the demand for international travel.

Australian households and businesses have entered a new phase of expansion, but are more cautious than before the global financial crisis and the local housing market also has slowed after buyers failed to step up buying following the reduction of government stimulus, the Reserve Bank of Australia said.

“Our reading of the recent data is that Australian households and business sectors have, in aggregate, entered a phase of expansion. But they seem to be showing more financial caution than they did prior to the crisis,” RBA Head of Financial Stability Luci Ellis said in a speech Wednesday.

Sydney was ranked in the top 10 global cities in the world in a report by international management consulting giant AT Kearney.

The harbor city ranked ninth in the company’s 2010 Global Cities Index, which assesses 65 cities around the world based on business activity, human capital, political management, cultural experience and information exchange.

The Queensland premier will meet business leaders in Townsville next week to promote plans to import hydropower from Papua New Guinea to the state’s north.

Anna Bligh will govern the state from the north next week, basing herself in Townsville from October 11 to 16.

Fortescue Metals said Wednesday the dispute with Armada (Singapore) Pte Ltd, an Asian dry bulk carrier, resulted in an award of $3.7 million for two shipments suspended in December 2008, after an arbitration panel decided on a final case.

Fortescue had sought damages of more than $70 million, the company said.

Potash Corp argued that Saskatchewan would lose more than C$2 billion in tax revenue if BHP Billition’s bid for the company succeeds. Potash Corp was responding to a report by Conference Board of Canada report that said the province of Saskatchewan, the home base of Potash, would lose more than C$2 billion in tax revenue if the transaction took place.

Rio Tinto will be faced with a $275.5 million break fee if it walks away from its $116 million iron ore joint venture with BHP Billiton.

However the mining giant denied such reports and said, “The Rio Tinto board has not made any final decisions about possible outcomes or next steps relating to the proposed iron ore joint venture in Western Australia.”

Health insurer NIB Holdings cash offer of $140 million for not-for-profit rival Geelong-based GMHBA has been rejected by the target company.

NIB said after the offer, the combined company would have had 9% market share with 500,000 policy holders and annual premium revenue of $1.2 billion.

Adelaide Energy said Wednesday sales in the September quarter were a record due to deliveries of gas and condensate from its Otway Petroleum project and revenue of $1.64 billion was achieved.

Resource News

Mineral explorer Alcyone Resources posted some solid gains recently after confirming strong results from its extended drilling program in Queensland.

Empire Resources reports higher levels of copper in first-pass rock chip sampling on newly acquired tenements directly north of its Yuinmery copper-gold project in Western Australia.

Central Petroleum said flow testing of the Johnstone West-1 well in the Amadeus Basin in Northern Territories did not bring oil to the surface.

Western Australia-based gold explorer Vector Resources launched a A$2.5 million off-market bid for all shares in unlisted public company Golden Iron Resources.

Gainers & Losers

Medusa Mining Ltd led gainers in the ASX with a gain of 8.7% to A$5.50 followed by Perseus Mining Ltd 7.5% to A$3.01, Independence Group 7.47% to A$6.33, Lynas Corp Ltd 7.45% to A$1.515 and Oz Minerals Ltd 6.57% to A$1.54.

Oceana Gold Corp led decliners in the index with a drop of 2.85% to A$3.75 followed by Awe Ltd 1.63% to A$1.505, Singapore Telecommunications Ltd 1.61% to A$2.45, Connecteast Group 1.16% to A$0.425 and Abacus Property Group 1.15% to A$0.43.