Australian Stocks Rebound; News Corp Under Scanner

Marcus Jacob
13 Jul, 2011
New York City

Australian stocks rebounded after steep losses last week. Resources linked companies gained after China expanded at 9.5% in the second quarter. David Jones estimated net profit to decline as much as 2%.

[R]4:30 Sydney – Australian stocks rebounded after steep losses last week. Resources linked companies gained after China expanded at 9.5% in the second quarter. David Jones estimated net profit to decline as much as 2%.[/R]

Australian stocks rebounded after steep losses in the last week after China reported economic growth in the second quarter of 9.5%. Resources linked companies also closed higher and News Corp faced more scrutiny.

The ASX 200 index increased 19.40 or 0.4% to 4,515 and All Ordinaries index dropped 19.70 or 0.4% to 4,583.

The Australian dollar increased 0.7% to US$1.067. Spot gold in Sydney trading increased $14.20 to US$1,573.30 an ounce.

In trading, turnover increased to 2.07 billion shares worth $5.36 billion and 576 shares closed higher, 447 declined and 374 were unchanged.

Stock Movers

BHP Billiton increased 0.4% to $43.63, Rio Tinto decreased 0.6% to $80.95 and Newcrest added 0.7% to $38.96.

Lynas Corp increased 2.5 cents to $1.965 and its Malaysian refinery plans to spend as much as US$210 million in the second stage of expansion.

News Corp decreased 3% to $14.74 after the company faces united opposition from the UK lawmakers against its proposal to gain the full control of British Sky Broadcasting.

The company is also likely to attract investigation from the U.S. Securities and Exchange Commission and Department of Justice for illegal payments to UK police. The SEC fines starts with US$25 million and the Justice department may seek jail time for executives.

David Jones decreased 0.4% after the retailer said net profit in the current year ending in July is expected to decline between $167.7 million and $169.7 million.

The retailer also anticipated first half profit to fall between 15% and 20% or between $84.5 million and $90 million.

Nufarm increased 8 cents to $4.56 after the company estimated operating profit in the current fiscal year between $67 million and $73 million.