Australian Unemployment Inches Up to 5.3%; IAG in Focus

Marcus Jacob
08 Dec, 2011
New York City

Australian stocks edged lower in a broad market weakness. The unemployment rate increased to 5.3% in November as employers cut more than expected full-time positions and added fewer than expected part-time jobs. IAG gains on takeover speculation.

[R]8:00 PM Sydney – Australian stocks edged lower in a broad market weakness. The unemployment rate increased to 5.3% in November as employers cut more than expected full-time positions and added fewer than expected part-time jobs. IAG gains on takeover speculation.[/R]

Australian stocks traded sideways as investors worried that the upcoming 2-day summit of European leaders may not lead to concrete steps and mire the region in slow growth for the next several years.

The ASX 200 index fell 11.8 or 0.3% to 4,280.7 and All Ordinaries index declined 0.3% or 12.4 to 4,338.90. The Australian dollar edged lower 0.3% to US$1.027.

In trading, stock turnover increased to 2.5 billion shares worth $4.2 billion.

Australia’s unemployment increased to 5.3% in November from 5.2% in October as employers cut more than expected full time positions.

Employers cut 39,900 full time jobs in the month and reversed the 26,200 jobs added in the previous month according to the data released by the Australian Bureau of Statistics.

Total employment in November fell to 11.457 million and full-time employment declined to 8.026 million and part-time jobs increased to 3.431 million.

Seasonally adjusted aggregate hours worked in the month increased 0.7% in November after rising 0.8% in October. From a year ago month, the hours worked in November rose 0.8%.

The unemployment rate in Western Australia was flat at 4.3% and in the most populous state declined to 5.2% from 5.3% after adjusting for seasonality. In Victoria the rate increased to 5.5% from 5.4%.

Stock Movers

BHP Billiton Ltd fell $0.03 to $36.99 and Rio Tinto Ltd decreased $0.16 to $66.09. Newcrest Mining rose $0.32 to $33.50.

Fortescue Metals Group decreased 4 cent to $4.84, Lynas Corporation Limited closed down 3 cents at $1.33 and Iluka Resources rose $0.89 to $16.68.

Iluka signed a deal to sell at a higher prices materials rutile (a natural form of titanium dioxide) and synthetic rutile in the first half of 2012.

Oil Search Limited traded down 2 cents to $6.48, Santos Limited fell 52 cents to $13 and Woodside Petroleum decreased $0.76 cents to $32.90.

Commonwealth Bank of Australia fell $0.49 to $49.68 and National Australia Bank increased 21 cents to $24.61. ANZ edged down 11 cents to $21.13. Westpac fell 8 cents to $21.53.

David Jones Limited fell 10 cents to $2.74 and Wesfarmers Limited fell 9 cents to $31.91 Harvey Norman Holdings fell to $2.11.

IAG increased 5 cents to $3.18 and extended gains for the seventh day in a row on a speculation that the insurer may be a target of takeover by Wesfarmers. IAG rebuffed informal offer of $4.20 a share from QBE nearly three years ago.

Woolworths Limited closed down 1 cent to $25.68 and James Hardie Industries SE increased 1 cent to $7.01.

Telstra added 3.5 cents to $3.29 as defensive stocks with dividend were favored in trading.

Qantas Airways Ltd closed unchanged at $1.62, Virgin Australia closed unchanged at 35.5 cents and Flight Centre rose 22 cents to $18.91.

QBE Insurance Group Limited decreased 10 cents to $14.05.