Australian Stocks Close Higher, Labor Party Voted Out

Marcus Jacob
09 Sep, 2013
New York City

Australian stocks participated in a regional rally a day after the nation elected new party and a new leader to govern the nation. Australian dollar was firm and business leaders voiced optimism about the scraping of carbon tax. Total home loans issued increased 2% in July.

[R]4:45 PM Sydney, Australia – Australian stocks participated in a regional rally a day after the nation elected new party and a new leader to govern the nation. Australian dollar was firm and business leaders voiced optimism about the scraping of carbon tax. Total home loans issued increased 2% in July.[/R]

Australian stocks closed higher along with other markets in Asia on the first day of trading after Federal Elections.

The ASX 200 index closed down 37 points to 5,182. In trading, 650 million shares changed hands worth $3.6 billion.

Australian dollar closed at 91.96 cents and gold held firm near US$1,388 and light crude price for immediate month delivery increased $2.16 to US$110.53.

The number of home loans approved in July increased 2% to 52,204 from 50,983 in June, the Australian Bureau of Statistics said today.

Total home loans issued increased 1.1% to $24.18 billion in the month.

Conservatives Return to Power

Liberal/National coalition leader Tony Abbott is set to become the next Prime Minister of Australia after internal fighting in the Labor Party hurt its chances to retail power.

With more than 90% of votes counted, the coalition won 88 seats and Labor retained only 57 in a 150-seat House of Representatives, the Australian Electoral Commission said. The election results will end the first minority government in Australia since World War II.

Presume Prime Minister Tony Abbott is going to face new economic challenges as the mining and resource sector boom cools and international commodities prices weaken affecting the largest Australian exports.

Both parties proposed tougher regulations and enforcement to deter refugees from the entering the country illegally. Australia has attracted refugees from as far as Afghanistan in the recent years.

Stocks in Review

Beadell Resources Limited gained after the gold miner reported first-half net profit of $37.1 million as its mine Brazil began production in the period.

Newcrest Mining Limited decreased 3.4% to $13.24 and chief executive Greg Robinson took a $1 million pay cut to $2.7 million and no bonus after the company reported large losses in fiscal 2013.

RHG Limited, mortgage securities investor, received a new and revised offer with a higher cash component from Pepper Australia and Cadence Capital Limited.

The Trust Company Limited increased after it agreed to a higher bid from Perpetual Limited.