Australia August Trade Surplus

123jump.com Staff
02 Oct, 2008
New York City

Australia reported its August trade surplus of A$1.3 billion from a revised deficit of A$697 million as exports rose 6% from a year ago and imports declined 2%. In trading, stocks edged lower as credit market remained tight and futures in metals market were on the decline.

[R]3:00AM New York, 7:00PM Sydney- Australia''s trade balance soars in August.[/R]

Stocks in Australia dropped marginally despite government data that showed the country''s trade balance turned from a deficit to a surplus in August.

Investors are worried over the health of the global economy even after the U.S. Senate overwhelmingly passed the $700 billion rescue plan.

Market Sentiment

In Sydney trading ASX 200 slid 0.7% or 33.5 to 4,761.10.

Of the 200 ASX 200 stocks 50 rose, 138 declined, and 12 were unchanged. GPT Group led advancers in the index shares with a rise of 7.74%.

Australia Trade Balance Rises

The Bureau of Statistics in Australia reported on its Web site today that the country''s trade balance turned from a revised deficit of A$697 million in July to a surplus of A$1.3 billion in seasonally adjusted terms in August.

There was a strong rise in non-rural and other good credits that underpinned the rise.

Exports surged 6% to A$24.6 billion as non-rural goods sales advanced 11% to A$1.5 billion and rural goods increased by 4% to A$79 million. However, exports of other goods dived by A$147 million.

Notably, the rise in non-rural goods was spurred by shipments of coal, coke and briquettes, which spiked by 26% to A$943 million, including metal and mineral ores that gained 5% to A$215 million.

Imports declined 2% to A$23.3 billion as intermediate and other merchandise goods slid 7% to A$623 million and consumption goods plummeted 1% to A$52 million.

The fall of intermediate goods was the result of the 25% drop in fuels and lubricants by 25% to A$887 million.

Above Average Metal Prices Forecasted

Rio Tinto chief executive Tom Albanese said in a speech at the Melbourne Mining Club that the $101 billion takeover bid by the BHP that was approved by Australia''s competition regulator significantly undervalues the company.

Albanese added that the company has a """"clear strategy, well balanced portfolio of high quality assets and exceptional growth opportunities"""".

The mining giant forecasts that prices will be higher-than-average next year due to strong demand from China and constrained supply conditions.

However China''s GDP is projected to ease from 12% in 2007 to 10% this year.

U.S. Senate Approves Bailout Bill

The U.S. Senate yesterday approved the proposed bank bailout plan with an overwhelming majority.

For the bill, 40 Democrats, 33 Republicans and 1 independent Senator voted in favor of the bill. Presidential candidates Barack Obama and John McCain also supported the bill.

The amended 400-page proposal expands the U.S. Treasury authority to buy $700 billion in installments of mortgage securities and limits executive compensation of companies that participates in the program.

The amended bill will be put to a vote in the U.S. House of Representatives on Friday.

Gainers & Losers

GPT Group led advancers in the ASX 200 index shares with a rise of 7.74% followed by increases in Amcor Ltd. of 6.32%, in Sino Gold Mining of 6.05%, in Mirvac Group of 5.43%, and Suncorp-Metway Ltd of 4.37%.

FKP Property led decliners in the ASX 200 index shares with a fall of 19.72% followed by losses in Minara Resources of 15.79%, in Gloucester Coal of 15.78%, in Babcock & Brown of 11.50%, Tishman Speyer of 10.62%.

Other commodity stocks also fell as well. Panoramic Resources slid 10.04%, Murchison Metals declined 9.52%, and Fortescue Metals dropped 8.66%.