Australian Stocks Flat; Lynas Raises $225 Million

Marcus Jacob
24 Jan, 2012
New York City

Australian market indexes closed flat and resources stocks led the losers. Rare earth miner and processor arranged $225 million in financing for its Malaysia based refinery. The IMF urged Australian banks to increase capital reserves.

[R]8:00 PM Sydney – Australian market indexes closed flat and resources stocks led the losers. Rare earth miner and processor arranged $225 million in financing for its Malaysia based refinery. The IMF urged Australian banks to increase capital reserves.[/R]

Australian stocks closed flat and resource stocks lost most of the early gains in trading as the euro zone finance ministers rejected the banks proposal for 4% or higher interest rate on restructured Greek bonds.

The ASX 200 index fell 0.9 to 4,224.2 and All Ordinaries index declined 1.2 to 4,286.40.

Billabong dropped 6% on the worries that the recent plunge in the stock price may invite unnecessary bid from leveraged buyout firms and Newcrest Mining increased after its production results were in line of market expectations.

IMF also urged Australian banks to increase their capital to withstand losses in the event from the fallout of the housing market and corporate lending. Banks rejected the calls for higher capital set aside for shock in the housing market and said more reserves will make less cash available for home loans.

Stock Movers

BHP Billiton Ltd fell 16 cents to $37.08 and Rio Tinto Ltd increased $0.46 to $68.35.

Fortescue Metals Group decreased 8 cents to $4.92, Lynas Corporation Limited was unchanged at $1.28 and Iluka Resources decreased $0.32 to $18.30. Newcrest Mining rose 64 cents to $32.84.

Lynas Corp said it has arranged $225 million in convertible bond financing to fund its rare earth processing refinery in Malaysia. The company also delayed its refinery start date to the second quarter from the first on monsoon rains and more engineering work at the site.

Oil Search Limited traded up 18 cents to $6.84, Santos Limited closed up 1 cent at $13.58 and Woodside Petroleum increased 25 cents to $33.95.

Oil Search said its operating revenues for the year ending in December increased 26% to US$732.9 million production increased to 6.69 million barrels of oil equivalent. Managing director Peter Botten said 2012 production is expected to be between 5.2 and 6.7 mmboe.

Commonwealth Bank of Australia increased 6 cents to $49.80 and ANZ increased 8 cents to $20.95 and Westpac inched lower 12 cents to $20.58. National Australia Bank closed down 13 cents to $23.72.

David Jones Limited decreased 8 cents to $2.34 and Wesfarmers Limited decreased 1 cent to $30.26. Harvey Norman Holdings closed down 1 cent $2.04.

Woolworths Limited closed down 4 cents to $24.69 and JB Hi-Fi Limited increased 2 cents to $12.02. Billabong International Ltd closed down 12 cents to $1.87 and Kathmandu decreased 1 cent to $1.23.

Qantas Airways Ltd rose 2 cents to $1.60, Virgin Australia closed unchanged at 30.5 cents and Flight Centre added 23 cents to $19.45.

QR National closed down 4 cents at $3.65.