Australian Indexes in Correction with 10% Loss from May Peak

Marcus Jacob
07 Jun, 2013
New York City

Australian construction industry contracted in the third year and market indexes extended losses in the week. For the week, the ASX 200 index dropped 3.8% after losing 9% in May. The Australian dollar declined to a new one-year low against the U.S. dollar.

[R]5:00 PM Sydney – Australian construction industry contracted in the third year and market indexes extended losses in the week. For the week, the ASX 200 index dropped 3.8% after losing 9% in May. The Australian dollar declined to a new one-year low against the U.S. dollar.[/R]

Australian stocks extended losses for the fifth week in a row and closed lower on weak precious metal prices.

Market indexes in Sydney fell 0.9% today and declined 3.8% in the week after losing 9% in May.

The ASX 200 index slid 43.50 to close at 4,737.70 and the broader All Ordinaries slipped 42.50 to 4,729.30. For the week ASX 200 declined 3.8%.

Australian dollar traded at 94.92 U.S. cents and in stock trading turnover slipped to 840 million worth $4.8 billion.

Australian construction sector contracted for in April and extended the shrinkage to the third year in a row.

The Construction Index increased 0.1 to 35.3 in April, according to the data tracked by Australian Industry Group and Housing Industry Association.

Any reading below 50 indicates a contraction and in the statement AIG said recent rate cuts from the Reserve Bank of Australia has helped to steady the decline but failed to revive the industry growth.

Stocks in Review

Rio Tinto slumped 87 cents to $53.20 and BHP dropped 68 cents to $33.09.

Woodside Petroleum Limited slipped 35 cents to $34.93.

David Jones Limited fell 2 cents to $2.46 and Breville Group closed unchanged at $7.15.
Woolworths lowered 8 cents to $32.

Mirvac Group added 2 cents to $1.63. Lend Lease down 12 cents to $9.31.

Westpac slid 11 cents to $27.60, Commonwealth declined 1.7% to $65.02 and National Australia Bank decreased 1.4% to $28.35 and ANZ slid 0.6% to $26.70.

Air New Zealand strengthened its profit outlook and agreed to pay $7.5 million to settle legal dispute with the New Zealand Commerce Commission.

Lynas Corporation Limited slid 1.9% to 51.5 cents after the rare earth minerals producer said it plans to cut costs and reduce capacity at its Malaysian refinery as demand weakens.

Newcrest Mining, Ltd. plunged $1.01 or 7.6% to $12.35 after the gold producer said it plans to write-down the value of its assets by as much as $6 billion and close its Brisbane office.

The company expects to be free cash flow neutral after capital expenditure of nearly $1 billion in 2014.

Newcrest closed at a new low and has lost more than 50% of its value in the last one year as the gold price continue to drift lower.

Subzero Group Limited closed unchanged at 17 cents after the property developer secured contract from Rio Tinto Ltd for $40 million.