Australian Stocks Rebound; Leighton Reaffirms Outlook

Marcus Jacob
11 Nov, 2011
New York City

Australian stocks edged up and closed nearly unchanged after a volatile week. Leighton Holdings vowed to keep costs under control and reaffirmed its annual earnings outlook. Fairfax Media dropped after founder sold his entire stake.

[R]6:00 PM Sydney – Australian stocks edged up and closed nearly unchanged after a volatile week. Leighton Holdings vowed to keep costs under control and reaffirmed its annual earnings outlook. Fairfax Media dropped after founder sold his entire stake.[/R]

Australian stocks traded higher after international markets rebounded and Asian markets recouped some of the losses in the week.

The ASX 200 index rose 52.40 or 1.2% to 4,296.50 and All Ordinaries index decreased 1.2% or 51.3 to 4,358.60. For the week, the ASX 200 index closed up 0.36%.

The Australian dollar eased to US$1.015.

Markets in Shanghai increased a fraction, in Tokyo gained 0.16%, in Hong Kong added 0.9% and in Mumbai lost 1%.

Stock Movers

Fairfax Media Ltd edged 6.5 cents lower to 86.5 cents after the company founded John B. Fairfax completed the sale of its last remaining 9.7% stake in the company for $193 million. The sale by the family was considered by the market as the insider selling prompting worries.

BHP Billiton Ltd closed up $0.32 to $37.80 and Rio Tinto Ltd increased $0.51 to $69.33. Newcrest Mining increased 50 cents to $36.90.

Fortescue Metals Group increased 13 cents to $4.82, Lynas Corporation Limited closed up 4 cents to $1.21 and Iluka Resources added 42 cents to $17.52. Kingsgate Consolidated decreased 13 cents to $6.73.

Oil Search Limited increased 7 cents to $6.40, Santos Limited rose 38 cents to $13.56 and Woodside Petroleum gained 53 cents to $36.28.

Brambles added 24 cents to $6.89 after the pallet maker said first quarter revenues soared 32% and estimated full year profit of US$1.1 billion.

Cochlear Limited added $1.99 to $54.49.

Commonwealth Bank of Australia closed up $0.76 to $49.59 and National Australia Bank increased $0.05 to $24.58. ANZ edged up $0.18 to $20.70. Westpac added 18 cent to $21.04.

David Jones Limited closed up 3 cents to $3.28 and Wesfarmers Limited closed up 25 cents at $33. Harvey Norman increased 6 cents to $2.21.

Woolworths Limited increased 36 cent to $24.83 and James Hardie Industries SE decreased 3 cents to $6.02.

Qantas Airways Ltd closed up 3 cent at $1.62, Virgin Blue closed up 1 cent 39 cents but Flight Centre rose 22 cents to $19.72.

Leighton Holdings Limited increased 6 cents to $20.18 after the management vowed to be more cautious in taking on new projects and vigorously control costs.

Leighton said first fiscal quarter 2012 revenues increased 30% to $6.2 billion and after-tax profit surged to $137 million compared to $48 million a year ago.

The company retained its full-year outlook between $600 million and $650 million excluding one-time pre-tax profit of $225 million from the sale of its iron ore operations in Pilbara to BHP Billiton.

Management also indicated that Australia’s rapidly growing coal seam gas industry will provide “unprecedented opportunities” for Leighton.

Recently appointed chief executive Hamish Tyrwhitt said that the company has a backlog of $45 billion and will participate in the bidding of $27 billion of projects in the next 3 months, indicative of the markets “we operate are not slowing down.”