Aussie Dollar Slips to Six-Year Low, Rio Says Weak Iron Ore Outlook

Marcus Jacob
16 Jul, 2015
New York City

Australian markets traded higher but the Aussie dollar dropped below 74 U.S. cents. Rio Tinto said global iron ore production in June quarter rose 9% but issued weak outlook for shipment. Woodside Petroleum second quarter revenues dropped 46%.

[R]5:30 PM Sydney – Australian markets traded higher but the Aussie dollar dropped below 74 U.S. cents. Rio Tinto said global iron ore production in June quarter rose 9% but issued weak outlook for shipment. Woodside Petroleum second quarter revenues dropped 46%.[/R]

Australian market indexes gained after Greek parliament approved the list of conditions set by international lenders and U.S. Fed Chair Janet Yellen reaffirmed central bank’s readiness to raise rates this year.

Australian dollar closed at 73.66 U.S. cents and in stock trading turnover slid to 694 million shares worth $4.8 billion.

At close, the ASX 200 Index gained 33.40 or 0.6% to 5,669.60 and the broader All Ordinaries Index increased 30.80 to 5,649.80.

In commodities trading, gold dropped US$8 to US$1,155 an ounce and Brent crude rose 26 cents to close at US$57.31 a barrel.

Australian Stock Movers

Infigen Energy Limited declined 4.9% to 29 cents after the renewable energy producer plans to sell its U.S. wind power units for $365 million to a newly formed private equity firm Primary Wind Power LLC. The transaction is expected to close in October.

The company plans to use proceeds to repay debt and reduce the losses in the U.S. wind business.

QBE Insurance Group Ltd gained 1.9% to $14.67 after the general insurance company agreed to sell its mortgage and lender service business in the North America for $90 million and book a loss of about $120 million from the transaction.

Rio Tinto Limited rose 0.4% to $53.31 after the mining company reported global iron ore production for the second-quarter to June climbed 9% to 79.7 million tons from a year ago period and shipments jumped 8% to 81.4 million tons.

The miner completed the key elements of Pilbara expansion which is expected to lift production to 360 million tons per year.

Rio Tinto said iron ore production at Pilbara increased 9% to 75.2 million tons from a year ago period but sales soared 8% to 77.2 million tons.

Total mined copper production plunged 19% to 134 million tons from a year ago period the lower production was mainly due to lower output at Kennecott Utah.

However, the company lowered its full-year iron ore shipment outlook on lower prices and bad weather at Pilbara operations.

Woodside Petroleum Limited slipped 1.1% to $34.57 after the oil and gas explorer reported revenue in the second-quarter ending in June plunged 46% to $898 million from $1.41 billion from a year ago period due to drop in LNG prices and production.

The company said production in the quarter declined 14.5% to 20.1 million barrels of oil equivalent and sales dropped 9% to 19.5 million barrels of oil equivalent from 21.5 MMboe in the same period a year ago.