Australian Indexes Down 2.5%; Billabong Plunged 44%

Marcus Jacob
19 Dec, 2011
New York City

Australian shares plunged after investors worried that ongoing euro zone crisis will drag commodities prices. Retailers declined more than 3% after surf apparel retailer Billabong plunged 44% on earnings warnings.

[R]8:00 PM Sydney – Australian shares plunged after investors worried that ongoing euro zone crisis will drag commodities prices. Retailers declined more than 3% after surf apparel retailer Billabong plunged 44% on earnings warnings.[/R]

Stocks in Sydney traded higher after falling for three days in a row and commodities rebounded in Asia and in international markets.

The ASX 200 index closed down 98.8 or 2.4% to 4,060.4 and All Ordinaries index declined 104.9 or 2.5% to 4,113.9. Trading volume was weak as investors stayed on the sidelines.

The Australian dollar edged lower and closed at 99.95 U.S. cents.

Stock Movers

BHP Billiton Ltd fell $0.87 to $34.32 and Rio Tinto Ltd declined $1.60 to $60.20.

Fortescue Metals Group decreased 18 cents to $4.42, Lynas Corporation Limited closed down 2 cent to $1.15 and Iluka Resources fell $0.35 to $15.58.

Oil Search Limited traded down 23 cents to $6.12, Santos Limited fell 47 cents to $12.18 and Woodside Petroleum decreased $1.06 cents to $30.24 and the company said it may delay for six months its investment plan for Browse liquefied natural gas project in Western Australia.

Commonwealth Bank of Australia decreased $0.84 to $48.29 and National Australia Bank fell 28 cents to $23.15. ANZ edged down 28 cents to $20.65. Westpac inched lower 46 cents to $20.05.

David Jones Limited fell 25 cents to $2.50 and Wesfarmers Limited decreased 79 cents to $29.71 Harvey Norman Holdings closed down 17 cents to $1.96.

Woolworths Limited closed down 36 cents to $25.90 and JB Hi-Fi Limited decreased $0.91 or 7.2% to $11.80.

Billabong International Ltd plunged 44% or $1.61 to $2.03 after the retailer of surf and skate apparel lowered its earnings outlook. The retailer said same store sales for the six months to December are expected to decline 3% and pre-tax earnings would be in the range of $70 million and $75 million compared to $94.6 million in the year ago period.

Billabong also said its constant currency sales growth in the four months to October declined to 2.8% and further fell to 0.4% in the five months to November. The company blamed weather and weak sales in Europe, difficult retail climate in North America and wet weather in parts of Australia.

Qantas Airways Ltd closed down by 4 cents to $1.48, Virgin Australia closed unchanged at 35.5 cents and Flight Centre fell 74 cents to $18.91.

QBE Insurance Group Limited decreased 37 cents to $13.14.