Aussie Dollar Drops to 8-month Low on Yield Trade Unwinding

Marcus Jacob
29 Sep, 2014
New York City

Australian stocks extended five-week long losses and the Aussie dollar dropped to an eight-week low. Banks led the decliners after Reserve Bank of Australia signalled more scrutiny for home loans. Treasury Wine Estates ended talks to sell the company.

[R]5:00 PM Sydney, Australia – Australian stocks extended five-week long losses and the Aussie dollar dropped to an eight-week low. Banks led the decliners after Reserve Bank of Australia signalled more scrutiny for home loans. Treasury Wine Estates ended talks to sell the company.[/R]

Stocks in Sydney extended five-week losses and the Aussie dollar declined to an eight-month low.

Australian dollar traded at 86.4 U.S. cents and in stock trading turnover declined to 649 million shares worth $3.6 billion.

ASX 200 index slipped 49.20 or 0.9% to 5,264.20 and the broader All Ordinaries index fell 47 to 5,269.60.

Stocks in Review

Australia and New Zealand Banking Group dropped 1.5% to $30.53 after the financial services provider agreed to sell its 17.5% stake in Vietnam-based Saigon Securities Inc and did not disclose terms of the sale.

Lynas Corporation Limited tumbled 25.2% to 0.086 cents after the rare earth minerals explorer plan to raise $83 million from a 5-to-14 renounceable rights issue for existing shareholders.

The rare earths producer reported net loss in the year widened to $365.8 million from $107.4 million a year ago.

Qantas Airways Limited slipped 0.7% to $1.42 after the airline company said total number of passenger in August jumped 3% from a year ago and for the year-to-date climbed 3.2%.

Treasury Wine Estates Ltd plunged 8.5% to $4.50 after the wine maker rejected offer of $3.4 billion from the U.S.-based private equity bidders KKR and Rhone capital LLC and said the offer undervalued the company.