Australian Housing Market Worries Drag Stocks

Marcus Jacob
13 Jun, 2012
New York City

Australian stocks turned negative on the global economic slowdown worries. Domestic housing market remains vulnerable and soft commodities prices also weighed on the market sentiment. Whitehaven Coal said it received an offer to go private.

[R]8:30 PM Sydney – Australian stocks turned negative on the global economic slowdown worries. Domestic housing market remains vulnerable and soft commodities prices also weighed on the market sentiment. Whitehaven Coal said it received an offer to go private.[/R]

Stocks in Sydney trading opened higher after sharp gains in overnight trading in New York. The market sentiment weakened in the early afternoon and two indexes closed lower on the rising worries of global economic slowdown and vulnerable housing market in Australia.

World Bank lowered its assessment of global growth to 3% and said the persistent worries in the euro zone may spark a worldwide economic slowdown and commodities prices are expected to remain soft.

The ASX 200 index inched down 9.10 to 4,063.80 and All Ordinaries index fell 6.76 to 4,111.52.

The Australian dollar extended gains for the third day to 99.11 U.S. cents.

In trading, turnover increased to 1.5 billion shares worth $3.5 billion and 411 shares rose, 564 fell and 356 were unchanged.

Stock Movers

Computershare gained 15 cents to $7.82 and the company reiterated its full year outlook despite challenging business conditions in Europe.

David Jones Limited rose 1 cent to $2.24, Harvey Norman Holdings closed unchanged to $1.90 and Woolworths slipped 8 cents to $26.52.

Kathmandu fell 1 cent to $1.12. Billabong International Limited edged down 1 cent to $1.89.

Whitehaven Coal gained 18 cents to $4.18 after the coal miner said billionaire Nathan Tinkler has offered the company to go private but that will put more debt on the company.

BHP Billiton Limited gained 20 cents to $31.92 and Rio Tinto Limited slides 5 cents to $54.60. Fortescue Metals Group increased 13 cents to $4.58 and the miner said it has merged some of its iron ore assets with China controlled Baosteel.

Lynas Corporation Limited fell 2.5 cents to 95 cents and Iluka Resources declined 53 cents to $11.91. Newcrest Mining down 1 cent to $24.64 and Kingsgate added 2 cents to $5.66.

Oil Search Limited increased 8 cents to $6.77 and Santos Limited decreased 9 cents to $11.73 and Orica shrank 33 cents to $24.12.

Commonwealth Bank of Australia closed down at 20 cents to $50.62 and Bank of Queensland raised 1 cent to $6.67. ANZ slides 20 cents to $21.57. National Australia Bank decreased 7 cents to $22.15 and Westpac Banking Corporation closed down at 8 cents to $20.49.

Macquarie Group decreased $25.80 and the investment broker said it has acquired 5% stake in casino operator Echo Entertainment.

Stockland added 1 cent to $3.21, Leighton fell 4 cents to $16.88 and Toll Holdings closed down at 12 cents to $4.32.

Qantas added 2 cents to $1.10 after the company took steps to defend from a possible hostile takeover from private equity groups after the stock fell by one third in the last three weeks.

Virgin Australia unchanged to 38.5 cents and Flight Centre slumped 20 cents to $18.72.

QR National fell 1 cent to $3.36.