Australian Retail Sales Rise, Building Approvals Ease

Marcus Jacob
09 Jan, 2014
New York City

Australian retail sales in November increased 0.7% following a 0.5% rise in October. Building approvals declined 1.5% in the month but surged 22% from a year ago. Port Hedland Port Authority said iron ore shipment to China jumped 8% in December.

[R]4:30 PM Sydney – Australian retail sales in November increased 0.7% following a 0.5% rise in October. Building approvals declined 1.5% in the month but surged 22% from a year ago. Port Hedland Port Authority said iron ore shipment to China jumped 8% in December.[/R]

Investors in Australia reacted to international news and overlooked domestic economic data.

U.S. Federal Reserve’s latest minutes of meeting showed that the central bank considered quickening the tapering program. Also, policy makers concluded benefits of stimulus outweighed the negatives but questioned the need to continue program beyond the current year.

Investors also looked ahead to inflation data from China.

The Australian Bureau of Statistics reported retail sales in November increased 0.7% after rising 0.5% in October.

In a separate report form the agency showed building approvals slipped 1.5% to 16,396 in November but increased 22.2% from a year ago month.

The Port Hedland Port Authority reported iron exports to China jumped 8% to 24.2 million tons and total iron ore shipments reached 29.5 million tons in December. The shipment increased despite a 2-day port closure due to Cyclone Christine.

Australian dollar fell to 89.13 U.S. cents.

The ASX 200 index rose 8.40 to close at 5,324.40 and the broader All Ordinaries gained 8.80 to 5,327.50.

Stocks in Review

Rio Tinto slid 5 cents to $65.30. BHP fell 7 cents to $36.97. Woodside Petroleum Limited rose 12 cents to $38.

Westpac slipped 10 cents to $31.94.

Billabong International Limited rose 0.9% to 52.5 cents after the retailer said proposal to issue $185 million of shares to two U.S.-based private equity firms Centerbridge and Oaktree is likely to get backing from the Australian Shareholders Association.

Shareholders were set to vote on a proposal to issue 329 million shares at 41 cents per share to Centerbridge and Oaktree.

Newsat Limited closed unchanged at 43.5 cents after the Australia-based satellite communication provider secured extra $26 million of revenue on its Jabiru-1 satellite that prepares to launch in 2015.

Qantas Airways Limited gained 1.1% to $1.12 after Moody''s downgraded the airline’s debt rating to below investment grade or junk level.

Qantas responded to Moody''s comments and said the airline has strong liquidity, substantial cash reserves and undrawn committed bank facilities totaling $3 billion.

The airline also highlighted that it has lowered its gross debt by $1 billion.

TZ Limited surged 14.8% to 15.5 cents after the technology company said its U.S. subsidiary received an order for infrastructure protection worth around $0.8 million.