Rio Tinto Offers Positive Production Outlook, Australian Stocks Advance

Marcus Jacob
15 Apr, 2014
New York City

Australian market indexes advanced after Rio Tinto offered positive production outlook and latest minutes of RBA meeting offered no urgency to increase rates from the record low of 2.5%.

[R]5:00 PM Sydney – Australian market indexes advanced after Rio Tinto offered positive production outlook and latest minutes of RBA meeting offered no urgency to increase rates from the record low of 2.5%.[/R]

Australian indexes eased from the high of the day but still closed in the positive territory after the latest minutes of meeting from the Reserve Bank of Australia showed a neutral bias.

Policy makers appeared to be in no hurry to revise the record low rate of 2.5% and Aussie dollar came off from the 94 U.S. cents mark.

Commodities and resource stocks led the market advance after Rio Tinto released an upbeat quarterly production outlook.

Australian dollar closed at 93.91 U.S. cents and stock market trading turnover rose to 648 million shares worth $3.67 billion.

The ASX 200 index gained 29.30 or 0.5% to 5,388.20 and the broader All Ordinaries increased 26.70 to 5,380.30.

Stocks in Review

Rio Tinto added 9 cents to $63.35 and the iron ore producer affirmed its annual output guidance. Iron ore output in the quarter declined 6% to 66.4 million metric tons but climbed 8% from a quarter a year ago.

The company reported shipments in the first quarter dropped 8% compared to previous quarter mainly due to weather related interruptions at domestic Pilbara mines and in Canada.

Rio Tinto estimated iron ore production from the Pilbara mines to reach 290 million tons by the year end in June. Copper output in the quarter slumped 6% to 156,000 tons due to lower ore grades.

BHP rose 42 cent to $37.78. Woodside Petroleum Limited gained 0.2% to $39.15.

Westpac Banking Corp increased 22 cents to $34.37.

Insurance Australia Group Limited rose 0.5% to $5.49 after the insurer forecasted its premium growth in the year between 3% and 5%.

Nufarm Ltd jumped 2% to $4.07 after the crop protection company said it will close its manufacturing plant in New Zealand to save of $3 million per year.

OZ Minerals Limited climbed 2.4% to $3.84 after the Australia-based copper, gold and silver producer posted strong first-quarter copper production of 18,000 tons and said gold production increased.