Australian Stocks Ease; Takeover Offer Lifts Bow Energy 60%

Marcus Jacob
22 Aug, 2011
New York City

The Australian benchmark declined after weak commodities prices. BlueScope shuttered two steel plants and eliminated 1,000 jobs and Amcor announced better than expected earnings. Coal seam gas maker Bow Energy soared 60% after it received a buyout offer from Arrow Energy.

[R]5:00 PM Sydney – The Australian benchmark declined after weak commodities prices. BlueScope shuttered two steel plants and eliminated 1,000 jobs and Amcor announced better than expected earnings. Coal seam gas maker Bow Energy soared 60% after it received a buyout offer from Arrow Energy.[/R]

Australian stocks closed lower as commodities traded lower and weak global economic sentiment. The oil and energy related stocks were active after NATO led invasion captured Tripoli and two of Gaddafi’s sons.

The ASX 200 index fell 21.1 or 0.5% to 4,150.80 and the broader All Ordinaries index declined 19.6 or 0.5% to 4,082.30. The broader index has been under pressure since it last crossed 5000 on April 16, 2010.

The Australian dollar increased 0.6% to $1.069.

In trading, turnover declined to 2.26 billion shares worth $5.83 billion with 412 stocks closing higher, 579 lower and 346 closing unchanged.

Bow Energy soared 60% to $1.42 after the coal seam gas producer confirmed that it acquired a bid of $1.48 a share that valued the company at $520.5 million. The company received a bid from Arrow Energy which was recently acquired by Royal Dutch Shell and Petro China for $3.4 billion.

Stock Movers

Energy stocks were among the leading decliners after crude oil price declined.

Woodside Petroleum declined 91 cents to $34.53, Santos Ltd increased 17 cents to $11.24 and Oil Search closed unchanged at $6.00.

Rio Tinto decreased $0.84 to close at $68.58 and BHP Billiton added 3 cents to $37.53. Fortescue Metals closed down 15 cents $5.60.

Newcrest Mining declined 43 cents or 1.1% to $38.66 after gold price increased $7.55 to US$1,794.70.

Commonwealth Bank decreased 6 cents to close $45.90 and National Australia Bank fell 19 cents to $22.21. Westpac decreased 29 cents to $19.26 and ANZ decreased 20 cents to close at $19.30.

Amcor gained 17 cents to $6.70 after the industrial packaging maker reported net profit doubled to $356.7 million. The company also announced 19% increase in annual dividend to 35 cents and a $150 million share buyback plan. Sales increased 26% to $12.4 billion.

OneSteel decreased 1 cent to $1.33 after the steelmaker said it will invest $346 million in iron ore mines.

BlueScope Steel declined 4.5 cents to 74.50 cents after the steelmaker reported a loss of $1.054 billion and announced a closure of two steel plants that will eliminate 1,000 jobs.

The stock earlier declined as much as 11% after it reported annual revenues increased to $9.11 billion from $8.6 billion and reported underlying loss of $118 million. The company also took one-time charge of $900 million for the business restructuring announced earlier this month.

Treasury Wine Estates closed unchanged at $3.17.