Australian Indexes Rise 0.9%; Cyclone Yasi Worries

Devan Biswas
02 Feb, 2011
New York City

Australian stocks closed higher as metals and crude oil prices rise in international markets. Insurers face another round of losses as Cyclone Yasi approach eastern shores. Copper, tin and nickel surged as mines in Queensland shutdown.

[R]6:00 PM Sydney – Australian stocks closed higher as metals and crude oil prices rise in international markets. Insurers face another round of losses as Cyclone Yasi approach eastern shores. Copper, tin and nickel surged as mines in Queensland shutdown.[/R]

Australian shares closed sharply higher tracking the world markets gains and factories around the world rev up production. The Australian dollar gained and insurance stocks declined as cyclone Yasi makes its way to Australia.

The benchmark ASX 200 index rose 44.60 or 0.93% to 4,796.70 and the broader index All Ordinaries index gained 45.60 to 4,897.60.

The Australian dollar scaled higher as unrest in Egypt continued for the ninth day in a row and the U.S. steps up pressure on President Hosni Mubarak to step down.

The Australian dollar traded at $1.012.

Copper and tin prices in London trading surged to a new high on the threat from Cyclone Yasi. Copper surged more than 2.5% and tin gained more than 2%.

The category four Cyclone Yasi with more than 250 km per hour winds is expected to hit Australian eastern shores near Cairns and inflict widespread damage. Sugar industry is expected to suffer damages and metal production in Queensland has been halted only weeks after severe flood damages.

Nickel rose to $27,864 a ton in New York trading, copper closed at $9,810 a ton and tin closed at $30,400.

Stock Movers

BHP Billiton gained 2.4% or A$1.08 to close at A$45.70 and Rio Tinto increased A$1.71 or 2.03% to A$86.

Banks closed higher. ANZ increased 8 cents to A$23.79, National Australian Bank increased 5 cents to A$24.64 and Westpac added 6 cents to A$23.09.

Insurers declined as estimates of another round of losses related to Cyclone Yasi reach $110 million. IAG declined 9 cents or 2.4% to $3.62 and Suncorp Metway fell 15 cents of 1.8% to A$8.21.