Weak Australian Capital Spending Drags Indexes

Marcus Jacob
30 May, 2013
New York City

Australian indexes slipped on the global uncertainties but the dollar rebounded after private sector capital spending was lower than expected in March quarter. Online spending increased to 6% of total retail sales according to a private survey.

[R]5:00 PM Sydney – Australian indexes slipped on the global uncertainties but the dollar rebounded after private sector capital spending was lower than expected in March quarter. Online spending increased to 6% of total retail sales according to a private survey.[/R]

The ASX 200 index slipped 44 to 4,930.70 and the broader All Ordinaries dropped 42.10 to 4,917.10.

Australian dollar climbed to 96.81 cents against the U.S. dollar and in stock trading turnover jumped to 905 million worth $6.3 billion.

The Australian Bureau of Statistics said private capital expenditure dropped 4.7% in the March quarter and building approvals jumped 9.1% in April after increasing 5.5% in March.

Housing affordability increased in the first quarter to March, before the Reserve Bank lowered the rate. The index tracked by the Housing Industry Association and Commonwealth Bank of Australia and the index improved 1.2 percentage point in the quarter to 12.8%.

Australian continued to shift spending to online businesses, according to the index released by the National Australian Bank.

The online sales in April totaled $13.5 billion, 6% of total retail sales and an increase of 23% from a year ago.

Stocks in Review

Rio Tinto dropped 74 to $53.96 and BHP slipped 41 cents to $34.46.

Woodside Petroleum Limited fell 20 cents to $36.30.

David Jones Limited slid 1 cent to $2.55 and Breville Group jumped 17 cents to $7.56. Woolworths added 5 cents to $33.18.

Mirvac Group lowered 4 cents to $1.62. Lend Lease slumped 24 cents to $9.93.

Westpac gained 14 cents to $28.86, Commonwealth up 1.1% to $67.61 and National Australia Bank fell 1% to $29.32 and ANZ slid 0.3% to $27.53.

AGL Energy Limited slipped 1.7% to $14.13 after the energy provider paid $52.9 million in stamp duty to the government for acquisition of the Loy Yang power station, $30 million less than previously expected.

Atlas Iron Limited declined 5 cents or 6.1% to 77 cents after the explorer plans to decide on building a new mine by the end of next month and keep the shipping at 10 million tons a year during the September quarter.