Australian Unemployment Held at 5.7%, Construction Activities Expand

Marcus Jacob
07 Nov, 2013
New York City

Australian indexes closed lower in heavy trading and the dollar declined as banks closed higher. Unemployment rate in October held at 5.7% as mining and resource sector avoid adding more staff. Grain Corp Limited defended the latest takeover from the U.S. based Archer Daniels Midland.

[R]4:30 PM Sydney – Australian indexes closed lower in heavy trading and the dollar declined as banks closed higher. Unemployment rate in October held at 5.7% as mining and resource sector avoid adding more staff. Grain Corp Limited defended the latest takeover from the U.S. based Archer Daniels Midland.[/R]

Australian market indexes closed lower despite another record close in banks and financial services sector stocks. Weaker than expected read on the jobs front dampened enthusiasm in the market.

The dollar weakened and investors awaited rate decision later in the day from the European Central Bank.

The Australian Bureau of Statistics reported today unemployment rate held at 5.7% in October from revised 5.7% rate in September.

The Australian Industry Group and the Housing Industry Association said construction activity index jumped 6.8 points to 54.4 in October. Any reading above 50 shows expansion and below that mark represents contraction.

The sector has expanded for the first time since 2010.

Australian dollar dropped to 94.80 U.S. cents. In stock trading, turnover climbed to 802 million shares worth $5.8 billion.

The ASX 200 index slid 11.80 or 0.2% to close at 5,422 and the broader All Ordinaries fell 10.60 to 5,415.40.

Stocks in Review

Rio Tinto climbed 90 cents to $65.60 and BHP jumped 24 cents to $38.09. Woodside Petroleum Limited closed unchanged at $39.35.

Westpac declined 16 cents to $34.23.

Australian Agricultural Company Ltd closed unchanged at $1.12 after the farming company said net sales in the first-half ending in September dropped to $78.5 million from $98.9 million a year ago. Net loss for the period widened to $31.6 million compared to $18.6 million in the prior-year period.

Ausdrill Limited tumbled 28.7% to 98 cents to after the mining and energy service provider lowered its earnings outlook for fiscal year 2014 ending in June. The company estimated net profit-after-tax between $35 million and $45 million.

Bega Cheese Limited rose 0.6% to $4.84 after the dairy products maker sold its 6% stake to Fonterra Co-operative Group Limited, for 9.3 million shares at $4.95 per share for total of $46 million.

Graincorp Limited fell 0.4% to $12.15 after the chief executive officer Alison Watkins of grain supply chain said it is “pure fantasy” to think Australia can insulate itself from foreign investment in the agriculture sector, and refused to accept the proposed $3.4 billion takeover from U.S.-based Archer Daniels Midland.

Mirvac Group closed unchanged at $1.76 after the Australia-based property developer agreed to acquire $552 million of assets in the Harbourside shopping centre in Sydney and two office buildings in Melbourne.