Australian Stocks Ease; Commonwealth Bank Cautious Oulook

Marcus Jacob
15 Nov, 2011
New York City

Australian stocks eased on the worries that the euro zone volatility will persist for several years as Greece and Italy struggle to control spending and lower borrowing. Commonwealth Bank issued gloomy outlook. Uranium miners surged after Australia lifted exports bans to India.

[R]6:00 PM Sydney – Australian stocks eased on the worries that the euro zone volatility will persist for several years as Greece and Italy struggle to control spending and lower borrowing. Commonwealth Bank issued gloomy outlook. Uranium miners surged after Australia lifted exports bans to India.[/R]

The ASX 200 index fell 19.00 or 0.4% to 4,285.60 and All Ordinaries index decreased 0.4% or 17.6 to 4,351.50.

The Australian dollar eased to US$1.017.

In trading, stock turnover was 1.66 billion shares worth $4 billion and 414 stocks increased, 550 decreased and 383 were unchanged.

Markets in Shanghai were nearly flat, in Tokyo fell 0.7%, in Hong Kong declined 0.8% and in Mumbai lost 1.4%.

Stock Movers

BHP Billiton Ltd closed down $0.62 to $36.88 and Rio Tinto Ltd decreased $0.79 to $67.83. Newcrest Mining decreased 16 cents to $37.05.

Yesterday, BHP’s petroleum division chief executive J Michael Yeager said the company plans to spend about US$4.5 billion in the current financial year after spending US$20 billion to expand into onshore shale gas extraction.

Fortescue Metals Group increased 2 cents to $4.89, Lynas Corporation Limited was unchanged at $1.22 and Iluka Resources rose 19 cents to $17.69. Kingsgate Consolidated decreased 3 cents to $6.86.

Uranium miner Paladin Energy increased 5 cents to $1.66 and Toro Energy gained 0.8 of a cent to 8.5 cents. Peninsula Energy surged 15% and Uranium SA added 7%. Extract Resources increased 17 cents to $7.87.

Uranium mining companies gained after Prime Minister Julia Gillard scrapped a decade old exports ban of uranium to India. Australia had used the uranium fuel materials as a strategic lever over India for a decade and was forced to lift the ban after Japan suffered a triple disaster at its nuclear facility earlier in the year.

Australia sells the nuclear fuel to many other countries including communist China that has a large nuclear weapons program. India plans to increase its reliance on nuclear electric power plants in the next ten years as France, U.S. and Russia help build at least 16 plants.

Oil Search Limited decreased 7 cents to $6.31, Santos Limited fell 3 cents to $13.41 and Woodside Petroleum closed unchanged at $36.60.

Brambles added 6 cents to $6.96 and Cochlear Limited increased $0.67 to $55.37.

County Coal soared as much as 32 cents to 72 cents on the first day of trading. The U.S. based coal miner based in Wyoming plans to export coal to Asia.

Lend Lease declined 2 cents to $7.36 and the company was chosen to redevelop a mixed-use property project in Perth.

Commonwealth Bank of Australia closed down $0.71 to $49.15 and National Australia Bank decreased 4 cents to $24.52. ANZ edged up 4 cents to $20.70. Westpac added 4 cents to $21.09.

Commonwealth Bank issued a gloomy outlook and highlighted the rising headwinds for the rest of the year.

David Jones Limited closed down 3 cents to $3.26 and Wesfarmers Limited closed down 17 cent to $32.82. Harvey Norman decreased 1 cent to $2.16.

Woolworths Limited closed unchanged at $24.76 and James Hardie Industries SE increased 8 cents to $6.20.

Ramsay Health Care Limited decreased 37 cents to $19.42 and Managing Director Christopher Rex reiterated at the annual general meeting that the company is set to increase its core earnings and earnings per share between 10% and 12%.

Qantas Airways Ltd closed unchanged at $1.65, Virgin Blue closed down 0.5 cent 39 cents but Flight Centre declined 19 cents to $20.07.