Australian Retail and Home Sales Decline

123jump.com Staff
07 Jan, 2009
New York City

In weak trading in Sydney, stocks closed higher ahead of earnings release. November retail sales rose 0.1% and new home sales declined 1.1% in the month. Oil and gas company Santos revived its A$1.8 billion plan to develop and supply natural gas from a field in Western Australia.

[R]3:00AM New York, 7:00PM Sydney - Australian retail sales in November rise 0.1%. and new home sales decline 1.1% in the month.[/R]

Australian stocks gained led by a rally in commodity stocks as metal prices rose and the Aussie increased to a two-month high.

Energy stocks however dropped as oil prices eased $0.2 to $48.6 per barrel.

In Sydney trading ASX 200 Index rose 0.1% or 37 to 3,779.70.

Of the ASX 200 index stocks, 120 increased, 69 declined, and 11 were unchanged. PanAust led advancers in the index shares with a rise of 31.4% followed by Atlas Iron rising 30.4%.

Australian Retail Sales Rise 0.1% in November

Australia''s Bureau of Statistics reported today that the trend estimate of turnover for the Australian retail sales series gained 0.1% in November after increasing 0.2% for each of the three preceding months.

Sales however increased 1.9% in November from the same period a year earlier.

Industries that contributed to the increase in the trend include food retailing rising 0.7% and other retailing gaining 0.6%, while those that weighed on the trend were department stores dropping 0.4%, clothing and retailing 0.3%, household good retailing 1% and cafes, restaurants and takeaway food services 0.3%.

The trend estimate for chains and other large retailers gained 0.3% in November 2008 from the previous month and gained 5.1% from a year ago.

The statistics bureau said all states increased, with the exception of South Wales and Western Australia falling 0.2% and 0.1% respectively.

There was weak growth in Queensland and South Australia, which both rose 0.1%, and Tasmania increasing 0.2%.

New Home Sales Fall 1.1% in November

The Housing Industry Association reported today after a survey of 100 residential builders in Australia that new home sales dropped 1.1% in November on a slowing economy and difficulties in accessing finance for new projects.

Analysts had earlier forecasted that the increased First Home Owners Grant and falling interest rates would boost activity.

Sales of new detached houses slowed 0.4% in November from 5.2% the previous month as sales dipped 10.1% in Queensland.

HIA said activity in the multi-unit sector declined 5.3% in the review period after declining 8.6% in October.

However detached new home sales increased 7.9% in Western Australia and soared in New South Wales 3.8%, South Australia 1.8% and Victoria 0.9%.

HIA chief executive Chris Lamont said, “Measures to stimulate investment in the multi-unit sector should include a doubling of the depreciation allowance and extending eligibility of the National Rental Affordability Scheme to private investors. Ensuring availability of credit for new development is also vital in the current environment.”

Australian Dollar Rises

The Australian dollar rose to 72.05 against the dollar from $71.15 yesterday.

Gainers & Losers

PanaAust led gainers in the ASX 200 index shares with a rise of 30.4% followed by increases in Atlas Iron of 30.4%, in Boart Longyear Group of 22.9%, in Kagara Ltd. of 22.2%, and Equinox Mine-CDI of 21.6%.

Atlas Iron and other commodity stocks gained after metal prices increased. Copper futures for March delivery climbed 8.5% and gold prices advanced $8.20 to $866 per ounce.

Babcock & Brown led decliners in the ASX 200 index shares with a drop of 15.6% followed by losses in Macquarie Media of 14.8%, in Macarthur Coal of 10.9%, in Riversdale Mining of 9.5%, and Linc Energy.

Santos, Apache in A$1.8 billion Deal

Santos reported today that is has revived a A$1.8 billion deal with joint venture partner Apache to supply natural gas to Hong Kong''s CITIC Pacific.

The deal will entail the development of the US$600 million-plus Reindeer gas offshore Western Australia and a pipeline and gas processing plant onshore Devil Creek.

Santos will supply the Sino Iron project with 75 petajoules of gas over seven years from the second half of 2011 from Reindeer, a project that is 45% by Santos and 55% controlled by Apache.

Development was suspended in December after CITIC suspended the previous purchase agreement on weak global financial conditions.