Australian Indexes Erase 3-Weeks of Gains

Marcus Jacob
09 May, 2012
New York City

Australian indexes erased three weeks of gains in the last four sessions as Greece and the euro zone regained investors focus. David Jones announced a restructuring charge and Billabong appointed new chief executive. BlueScope completed the repurchase of $300 million private placement notes.

[R]8:00 PM Sydney – Australian indexes erased three weeks of gains in the last four sessions as Greece and the euro zone regained investors focus. David Jones announced a restructuring charge and Billabong appointed new chief executive. BlueScope completed the repurchase of $300 million private placement notes.[/R]

Australian stocks extended losses on the growing perception that the current Greek chaos may throw the euro zone in turmoil and drag world economies lower. Market indexes erased last three weeks of gains in the last four trading sessions.

The ASX 200 index decreased 39.20 to 4,275.10 and All Ordinaries index slumped 43.64 to 4,332.24. The yield of 10-year Australian bonds rose to a new high of 3.36%.

The Australian dollar drifted to US$1.005 and managed to close at US$1.008 on the rising worries that the euro zone may plunge into chaos as Greek leaders talk of rejecting the bailout.

Stock Movers

David Jones Limited decreased 7 cents to $2.31 and the company reshuffled its executive ranks and announced a one-time restructuring charge, Harvey Norman Holdings closed unchanged at $2 and Woolworths edged down 1 cent to $26.49.

Myer slipped 9 cents to $2.25 and Kathmandu fell 3 cents to $1.29. Billabong International Limited dropped 11 cents to $2.29 after the company appointed Launa Inman as its chief executive, former head of department store Target.

Mining and resources linked companies traded sharply lower after material prices fell on the worries of a global slowdown and the renewed fears of economic and political turmoil in the euro zone.

BHP Billiton declined 35 cents to $34.33 and Rio Tinto tumbled $1.03 or 1.06% to $61.23.

Lynas Corporation Limited inched down 5.5 cents to 97.5 cents and Iluka Resources plunged $1.16 or 8.3% to $12.85 after the company lowered its annual zinc production estimate to 430,000 from 500,000.

Newcrest Mining dropped $1.32 or 5.2% to $23.80 and Kingsgate slumped 39 cents to $5.53 after gold price for the immediate month delivery declined 4.6% to a four-month low.

Oil Search Limited decreased 18 cents to $6.96 and Santos Limited slides 14 cents to $12.93.

Westpac Banking Corporation closed up 1 cent at $22.84 and Commonwealth Bank of Australia declined 42 cents to $51.66. Bank of Queensland down 2 cents to $6.85. ANZ added 1 cent to $23.12. National Australia Bank fell 2 cents at $24.61.

Stockland unchanged to $3.23 and Leighton advanced 16 cents to $19.18 and Downer EDI increased 5 cents to $3.47 after the company said its troubled Warath Train project is on track to meet cost and schedule deadline.

Qantas decreased 3 cents to $1.50, Virgin Australia inched down 5 cents to 40.5 cents and Flight Centre dropped 34 cents to $19.70.

QR National slumped 13 cents to $3.43.