Australian Stocks Turn Lower; Qantas Faces More Strikes

Marcus Jacob
14 Oct, 2011
New York City

Australian indexes declined nearly 1% and caught in a trading range in the last two days after a 3-day rally. Banks were lower on the global banking system worries. Qantas faces more flight disruptions after engineers prepare to walk out tomorrow.

[R]6:00 PM Sydney – Australian indexes declined nearly 1% and caught in a trading range in the last two days after a 3-day rally. Banks were lower on the global banking system worries. Qantas faces more flight disruptions after engineers prepare to walk out tomorrow.[/R]

The Australian indexes turned lower in volatile trading after Asian markets eased.

The banks were among the leading decliners after a rating agency places ten largest global banks on a watch and cited higher capital requirements and a growing regulatory burden.

Separately, a rating agency S&P lowered credit rating of Spain by a notch and cited weakening economic conditions and stalled labor reforms. The rating action follows a downgrade a week by Fitch and two months after Moody’s placed the country’s debt on a watch list with a negative outlook.

The Australian dollar increased after the release of the data and traded at intra-day high of US$1.023.

The ASX 200 index decreased 38.9 or 0.9% to 4,205.6 and All Ordinaries index fell 37 or 0.9% to 4,269.00.

The Australian dollar rose 0.4% to US$1.02 and gold decreased US$6.15 to US$1,671.30.

Trading volume declined to 1.46 billion shares worth $3.59 billion with 413 stocks trading higher, 568 declined and 312 closed unchanged.

Stock Movers

BHP Billiton Ltd decreased $0.78 to $36.86 and Rio Tinto Ltd fell $1.04 to $68.30. Aquarius Platinum declined 18 cents $2.95. Iluka Resources fell 90 cents to $16.09.

Fortescue Metals decreased 17 cents to $4.89.

Linc Energy fell 4 cents to $2.06 and a day ago the company said it has finalized the purchase of oil field from ERG Resources for $236 million.

Leighton Holdings decreased 37 cents to $20.27 and the company won an offshore contract order worth $520 million from Iraq based South Oil Company.

Oil Search Limited decreased 1 cent to $5.97, Santos Limited fell 35 cents to $12.45 and Woodside Petroleum declined 47 cents to $35.03.

Commonwealth Bank of Australia closed up $0.08 to $47.50 and National Australia Bank decreased 6 cents to $24.28. ANZ edged down $0.11 to $20.99. Westpac decreased $0.14 to $21.61.

David Jones Limited closed down 2 cent to $2.97 and Wesfarmers decreased $0.15 to $31.64.

Woolworths Limited decreased 16 cents to $24.49 and James Hardie Industries SE declined 15 cents to $5.59. Treasury Wine Estate rose 2 cents to $3.83.

Qantas decreased 1 cent to $1.56 and airline continues to suffer from an ongoing strike from baggage handlers, engineers and mechanics. About 7,000 passengers are expected to face travel disruptions as engineers prepare to walkout tomorrow.

Yesterday, the airline was forced to ground 10 flights and cancel 100 flights today.