Australia Records Second Monthly Trade Deficit, Dollar Falls

Marcus Jacob
04 Apr, 2012
New York City

Australian exports declined 2% in February to $24.4 billion and imports fell 4% to $24.9 billion as consumers and businesses held back purchases. The dollar declined to a two-month low on the prospect of a rate cut next month.

[R]8:00 PM Sydney – Australian exports declined 2% in February to $24.4 billion and imports fell 4% to $24.9 billion as consumers and businesses held back purchases. The dollar declined to a two-month low on the prospect of a rate cut next month.[/R]

Australian stocks struggled after the release of second monthly trade deficit in a row and the dollar eased to a 11-week low.

The ASX 200 index edged down 3.10 to 4,333.90 and All Ordinaries index decreased 5.46 to 4,418.95.

In trading, 2.1 billion shares changed hands worth $4.5 billion and 427 stocks closed higher, 592 declined and 394 were unchanged.

The Australian dollar eased for the third day this week to $1.03 after the release of weaker than expected trade data in February. The Australian dollar dipped to an 11-week low as investors factored a rate cut next month on the surprise trade deficit.

The dollar traded at 85 yen, 78 euro cents and 64.75 pence.

Australia reported second monthly trade deficit in a row as coal and minerals exports struggled to recover. The first consecutive monthly deficit in two years dragged the dollar lower as imports outpaced exports by $480 million following a revised $971 million deficit in January.

Exports declined 2% to $24.4 billion after coal shipments declined 16% and minerals exports fell 10% and imports fell 4% to $24.9 billion on 12% decrease in consumption goods.

Stock Movers

Miners advanced in the session bucking the trend in the general market and BHP Billiton dropped 44 cents to $34.74 and Rio Tinto decreased 40 cents to $66.39.

Aquila Resources increased 5 cents to $5.06 after it said it plans to sell 50% stake sale in Isaac Plains coal mine to a subsidiary of Sumitomo Corp for $430 million.

Lynas Corporation Limited closed up 1 cent to $1.07 and Iluka Resources decreased 14 cents to $18.01.

Newcrest Mining declined 69 cents to $28.50 and Kingsgate slumped 25 cents to $6.05.

Oil Search Limited decreased 14 cents to $6.92. Woodside Petroleum dropped 28 cents to $35.00 and Santos Limited fell 9 cents to $14.33. Oil Search slumped 14 cents to $6.92.

Transfield Services fell 29 cents to $2.20 on the first day after the company was halted ahead of its revised earnings outlook that was lowered by 20%.

David Jones Limited decreased 15 cents to $2.27, Harvey Norman Holdings closed down 2 cent to $1.95 and Woolworths gained 9 cent to $25.79. Myer fell 1 cent to $2.22 and Kathmandu closed up 1 cent at $1.31.

Billabong International Limited increased 6 cents to $2.86.

Westpac Banking Corporation soared 30 cent to $22.12 and Commonwealth Bank of Australia decreased 14 cents to close at $49.90. Bank of Queensland dropped 12 cents to $6.93.

Macquarie Group declined 12 cents to $29.03 and QBE Insurance Group gained 3% after it issued an optimistic outlook for the year.

Real estate developers closed mixed Westfield Group closed up 6 cents to $8.84 and Stockland gained 5 cents to $3.00.

Qantas closed unchanged to $1.73, Virgin Australia hold to 42.5 cents and Flight Centre declined 35 cents to $21.60. QR National slumped 8 cents to $3.65.