Australian GDP Growth Accelerates, Stocks Close Lower

Marcus Jacob
04 Jun, 2014
New York City

Australian investors focused on the stimulus announcement from the European Central Bank tomorrow. Australian GDP rose at the fastest pace in two years but economists warned the recent decline in iron ore price will impact the economic data in the next quarters.

[R]5:00 PM Sydney – Australian investors focused on the stimulus announcement from the European Central Bank tomorrow. Australian GDP rose at the fastest pace in two years but economists warned the recent decline in iron ore price will impact the economic data in the next quarters.[/R]

Australian stocks closed lower despite the sharp in GDP of more than 3% in March quarter from a year ago, the first increase by that amount in two years.

The Australian Bureau of Statistics said a seasonally adjusted gross domestic product in the first-quarter expanded at 1.1% following 0.8% increase in the fourth-quarter of 2013.

On a yearly basis, gross domestic product climbed 3.5% in the March quarter compared to 2.8% rise in the December quarter.

Australian dollar edged up to 92.66 U.S. cents and stock market trading turnover dropped to 679 million shares worth $3.99 billion.

ASX 200 index slipped 34.90 or 0.6% to 5,444.80 and the broader All Ordinaries fell 33.70 to 5,426.80.

Stocks in Review

Australand Property Group climbed 5.6% to $4.55 after the industrial property developer received a takeover offer from Singapore-based Frasers Centrepoint for $2.6 billion.

Iluka Resources Limited slipped 1% to $8.48 after the zircon producer signed intellectual property agreement for titanium development with Brazil-based Vale SA located at Tapira in Minas Gerais State, of Brazil.

Noni B Limited surged 44.9% to 56.5 cents after the women’s apparel and accessory retailer said that the retailer has received several expressions of interest for a takeover.

The company said Wilson Asset Management Group has a 5.19% of total voting power in the company.

UGL Limited fell 1.8% to $7 after the diversified services provider secured a four-year contract from Stanwell Corporation controlled by Queensland for $280 million.