Australian Markets Rebound, Hastie Collapses

Marcus Jacob
28 May, 2012
New York City

Australian stocks gained on the hopes that Greece will stay in the euro zone and the currency union will avoid the latest ripple in the financial contagion. Engineering contractor Hastie Group collapsed with $500 million debt and sought bankruptcy protection.

[R]8:00 PM Sydney – Australian stocks gained on the hopes that Greece will stay in the euro zone and the currency union will avoid the latest ripple in the financial contagion. Engineering contractor Hastie Group collapsed with $500 million debt and sought bankruptcy protection.[/R]

Australian stocks closed higher and reacted to the latest opinion polls in Greece suggesting pro austerity parties are leading ahead of the national June 17 election.

Resources and banks led the most active stocks list but the fall of Hastie Group tempered market sentiment.

The ASX 200 indexes increased 38.80 to 4,068 and All Ordinaries index gained 38.98 to 4,120.16.

In trading, stock turnover was 1.3 billion shares worth $3.39 billion and 530 shares closed higher, 389 declined and 370 were unchanged.

The Australian dollar traded near the low of the year at 98.58 U.S. cents.

Stock Movers

Hastie Group was suspended from trading after the company collapsed with $500 million of debt and all of its 44 subsidiaries were placed in administration. Hastie last traded at 16 cents.

Hastie reported $20 million in losses on Friday and failed to agree on a recapitalization plan after lengthy negotiations.

David Jones Limited rose 3 cents to $2.30, Harvey Norman Holdings closed up 2 cent to $1.97 and Woolworths dropped 43 cents to $26.26.

Kathmandu fell 2 cents to $1.18. Billabong International Limited unchanged to $2.05.

BHP Billiton advanced 44 cents to $32.05 and Rio Tinto increased 97 cents to $56.90.

Lynas Corporation Limited gained 16 cents to $1.05 cents and Iluka Resources closed up 19 cents to $12.99.

Atlas Iron soared 8% after local media reports said quoting managing director that recent stock price weakness has left the company vulnerable to takeover bids.

A lift in precious metals prices helped Newcrest Mining to close up 60 cents to $25.35 and Kingsgate increased 30 cents to $5.29.

Oil Search Limited added 8 cents to $6.78 after the company said it may return capital to shareholders if its development projects failed to materialize.

Santos Limited gained 22 cents to $12.02 and Orica declined 40 cents to $24.63.

Commonwealth Bank of Australia advanced 56 cents to $49.28 and Bank of Queensland rose 5 cents to $6.30. ANZ increased 20 cents to $20.58.

National Australia Bank advanced 35 cents to $23.65 and its European operation chief resigned as the UK operation faces a restructuring and Westpac Banking Corporation closed up at 28 cents to $20.40.

Stockland closed up at 8 cents to $3.27, Leighton increased 12 cents to $17.57 and Toll Holdings gained 8 cents to $4.58.

Qantas closed up 4 cents to $1.50 and Virgin Australia edged up 5 cents to 42 cents and Flight Centre slumped 31 cents to $18.14.

QR National unchanged to $3.29.