Australian Indexes Extend Weekly Loss to 2.7% on Weak Iron Ore Prices

Marcus Jacob
21 Nov, 2014
New York City

Australian market indexes extended weekly drop to 2.7% after the iron ore price dropped below $71 a ton. Australian dollar struggled but energy companies advanced after the crude oil futures gained more than 1%.

[R]5:30 PM Sydney – Australian market indexes extended weekly drop to 2.7% after the iron ore price dropped below $71 a ton. Australian dollar struggled but energy companies advanced after the crude oil futures gained more than 1%.[/R]

Australian market indexes struggle to advance despite the steady gains in markets in New York and in Europe.

The persistent slide in iron ore price hovered already weak market sentiment as the price of the commodity closed below US$71 a ton for bulk delivery. In addition, the futures of iron ore indicate the price may decline as low as US$67 a ton.

Australian dollar decreased to 86.45 U.S. cents and in stock-trading turnover slipped to 707 million shares worth $4.25 billion.

ASX 200 Index fell 11.90 or 0.2% to 5,304.30 and broader All Ordinaries Index slid 10.40 to 5,292.10. For the week, ASX 200 slumped 2.7%.

In commodities trading, gold closed flat at US$1,194 an ounce and light crude oil rose $1 to US$75.58 a barrel.

Australian Stock Movers

Billabong International Limited climbed 3.9% to 67 cents after the surfware retailer’s chairman Ian Pollard cautioned at the annual general meeting to shareholders to “not expect radical change in the short-term performance.”

Kathmandu Holdings Ltd slipped 1.1% to $2.65 after the travel and adventure clothing retailer said group sales in the first-half ending in September climbed 18.6% to NZ$392.9 million from a year ago period. Same store sales in the period jumped 4%.

Net profit in the period dropped 4.5% from the same period a year ago to NZ42.2 million and earnings per share decreased to 21 cents.

National Australia Bank increased 0.5% to $32.27 after the financial service provider’s U.S. subsidiary Great Western Bancorp reported net interest income in the year ending in September soared 23% to $314.1 million from $255.1 million a year ago period.

Net profit in the year climbed 9% to $104.9 million compared to $96.2 million and earnings per share jumped to $1.81 from $1.66 in the same period a year ago.

Washington H. Soul Pattinson and Co. Ltd fell 0.6% to $13.98 after the resources investment company completed the sale of two distribution centers for $153 million to Super Retail Group Limited.