Australian Stocks, Dollar Advance; David Jones, Myers, Westfield in Focus

Marcus Jacob
11 May, 2011
New York City

Australian stocks advanced after China reported inflation above 5% but not high enough to slow down the economy. The Australian dollar edged up to $1.08. Westfield lifted outlook for development construction. David Jones after it reaffirmed annual earnings outlook.

[R]5:00 PM Sydney – Australian stocks advanced after China reported inflation above 5% but not high enough to slow down the economy. The Australian dollar edged up to $1.08. Westfield lifted outlook for development construction. David Jones after it reaffirmed annual earnings outlook. Myers estimated annual net to fall 5%.[/R]

Australian benchmark indexes gained more than 1% after China reported elevated inflation. Consumer price index in April increased 5.3% in April after rising at 5.4% in March.

Market has been worried that the elevated inflation may force China to tighten more and slow down the economy and the consumption of the iron ore and coal from Australia. Resource linked stocks gained.

The ASX index increased 54.40 to 4,780.20 and All Ordinaries index gained 54.60 or 1.14% to 4,858.20.

The Australian dollar edged up a fraction to US$1.087 and crude oil edged lower 47 cents to US$103.41.

Stock Movers

Resource stocks advanced after China reported inflation data. BHP Billiton increased 77 cents to $45.30 and Rio Tinto gained $1.80 to $81.45.

Westfield Group eased 2 cents to $9.05 and the mall developer reaffirmed estimates of annual earnings and operating income and lifted estimates of new property development for the next two years.

The mall developer commenced on $490 million of development work in the quarter to March and the company guided $1.25 billion development starts in 2012 and $1.5 billion in 2013 from the previous estimates of $750 million and $1 billion in the corresponding periods.

Westfield also guided full year earnings of 74.6 cents and distribution of 48.4 cents a share in 2011.

The company also said that retail sales in the last 12 months to March increased 1.6% to $21.5 billion in Australia and New Zealand and retail sales at its U.S. locations expanded 5.2% to $12.6 billion.

CSR increased 5 cents to $2.95 and the building materials company reported annual profit of $503.4 million compared to $111.7 million in loss a year ago.

Boral increased 26 cents to $4.91 after the building materials supplier estimated full year earnings between $160 million and $175 million.

David Jones increased 11 cents to $4.56 and the retailer reported third quarter sales declined but reaffirmed the annual net outlook.

Sales in the quarter ending in April declined 1.4% to $411.7 million and comparable same store sales declined 1.3%.

Myer Holdings edged up 1 cent to $3.18 after total sales in the third quarter declined 2% to $657 million to and estimated full year net to fall 5%.