Australian Indexes Dive 2% on Global Worries

Marcus Jacob
07 May, 2012
New York City

Australian indexes declined more than 2% on the global slowdown worries after the election results in Europe. Australian retail sales were ahead of expectations in March but new jobs ads declined in April according to a private survey.

[R]8:00 PM Sydney – Australian indexes declined more than 2% on the global slowdown worries after the election results in Europe. Australian retail sales were ahead of expectations in March but new jobs ads declined in April according to a private survey.[/R]

Australian stocks dropped sharply after retail sales jumped the most in nearly a year and a private jobs survey indicated a fall in new jobs ads. Investors drove indexes lower after elections results in Greece and France.

Greece is heading for a coalition government and may take three more months to decide which parties will be in the government and France elected its first Socialist president in 17 years after frustrated voters selected policies that favor more government spending that tackles unemployment above 10%.

Australian retail sales in March increased 0.9% to $21.2 billion and for the quarter to the month sales rose 1.8%, ahead of expectations.

The private survey conducted by ANZ Bank showed job advertisement in April fell 3.1%, after rising for three previous months in a row.

The ASX 200 index dropped 94.70 or 2.1% to 4,301.30 and All Ordinaries index declined 97.82 or 2.2% to 4,361.57.

In stock trading, turnover decreased to 1.8 billion shares worth $4 billion and 353 shares gained, 631 decreased and 409 closed unchanged.

The Australian dollar drifted to US$1.013 and traded near a four-month low.

Stock Movers

David Jones Limited decreased 10 cents to $2.40, Harvey Norman Holdings closed down 5 cents at $1.96 and Woolworths slumped 31 cents to $26.59.

Myer edged down 9 cents to $2.33 and Kathmandu edged down 3 cents to $1.31. Billabong International Limited decreased 12 cents to $2.39.

Mining and resources linked companies traded sharply lower after material prices fell on the worries of a global slowdown.

BHP Billiton tumbled $1.46 or 4% to $34.57 and Rio Tinto plunged $2.91 or 4.5% cents to $62.

Lynas Corporation Limited fell 5 cents to $1.02 and Iluka Resources declined 75 cents to $15.95. Newcrest Mining slumped 30 cents to $25.35 and Kingsgate decreased 11 cents to $5.99.

Oil Search Limited slipped 19 cents to $7.12 and Santos Limited dropped 60 cents to $13.09.

Orica declined 14 cents to $26.40 after the explosives maker said a chemical leak was responsible for a 4% decline in its first half net income.

Westpac Banking Corporation closed down 19 cents at $22.72 and Commonwealth Bank of Australia declined 56 cents to $52.06. Bank of Queensland decreased 10 cents to $6.84. ANZ declined 34 cents to $23.10. National Australia Bank plunged 43 cents at $24.71.

Stockland fell 2 cents to $3.20 and Leighton declined 17 cents to $19.25 after the construction firm said the completion date for the toll road linking Brisbane Airport may be delayed by two more days.

Qantas decreased 8 cents to $1.53, Virgin Australia inched down 1 cent to 40 cents and Flight Centre tumbled 67 cents to $19.88.

QR National slumped 11 cents to $3.51.