Australian Dollar Advances; Westpac Gains, Brambles Falls

Marcus Jacob
15 Feb, 2011
New York City

Australian stocks closed nearly unchanged and the Australian dollar rose to a 9-month high against the yen. Brambles declined after it reported lower than expected earnings. Westpac gained after quarterly net fell but interest margin rose. The RBA statement confirmed the tightening bias.

[R]5:30 PM Sydney – Australian stocks closed nearly unchanged and the Australian dollar rose to a 9-month high against the yen. Brambles declined after it reported lower than expected earnings. Westpac gained after quarterly net fell but interest margin rose. The RBA statement confirmed the above trend growth and tightening bias.[/R]

Stocks in Sydney trading edged lower and the Reserve Bank of Australia released its minutes of February 1 meeting. The dollar edged higher and rose to a 9-month high against the yen.

The ASX 200 index decreased 4.8 to 4,931.0 and All Ordinaries index declined 4 to 5,019.40.

The Australian dollar edged up against the dollar and closed at a 9-month high against the yen. The Aussie dollar fetched $1.0027 and 83.78 yen.

The RBA minutes confirmed what is publicly advertised by the central bank. The above trend line growth, rising investment and historically high terms of trade were confirmed in the statement.

The RBA statement also indicated that the bank is likely to have a tightening bias and additional rate increase are likely in the second half.

Westpac reported first quarter cash earnings declined 3% from a year ago to $1.55 billion on higher interest rate margin of 3 basis points to 2.20%.

The bank also confirmed that it cut 400 back office positions in the last few months and more cuts will be carried out in the current year.

The bank also lowered its fees on most popular mortgage product. The home loan establishment fee was cut to $395 from $600 on its Premier Advantage home loan.

Stock Movers

BHP Billiton increased 8 cents to close at $47.36 and Rio Tinto declined 36 cents to $88.14.

The largest miner increased for the second day in a row ahead of earnings tomorrow. Analysts are expecting half-year earnings of at least $10 billion.

Westpac declined after it reported latest quarterly earnings increase of 5% from the second half of last year on lower bad debt expenses.

Westpac declined 11 cents to $24.31 and National Australian Bank dropped 12 cents to $26.18 and Commonwealth Bank fell 54 cents to $53.30.

Primary Health Care dropped 2.8% or 10 cents to $3.47 after it reported first-half net dropped 73.5% to $20.30 million.

Brambles declined 4 cents to $7.19 after it reported lower than expected earnings. Stock earlier fell as much as 7 cents.

Brambles first-half net rose less than expected 6% to US$219.80 million.

Goodman Group led the gainers in the ASX 200 index and rose 2 cents or 3% to 69 cents.