Australian Trade Surplus, Home Approvals Fall

Darlington Musarurwa
08 Jan, 2009
New York City

Australia trade surplus declined 51% to A$1.45 billion in November from A$2.96 billion the previous month as exports declined 4% to A$26.9 billion in the period. Seasonally adjusted total dwelling units approved in November fell 12.8% from a month ago and 34.7% from a year earlier to 9,581.

[R]3:00AM New York, 7:00PM Sydney- Australia’s trade surplus declined 51% to A$1.45 billion in November. Housing approvals drop 34.7% in November.[/R]

Australian stocks fell 2.3% after a spate of negative data that showed the country’s trade surplus halved in November and total dwelling units approvals fell sharply.

Investors also abandoned commodity stocks as oil and metal prices dropped on the continued deterioration of the global financial markets.

In Sydney trading ASX 200 index declined 2.3% or 85.4 to 3,694.30.

Of the ASX 200 index stocks, 44 rose, 148 declined, and 8 were unchanged. Abacus Property led gainers in the index shares with a rise of 14.6% followed by Goodman Corp. increasing 8.7%.

Australian Trade Surplus Drops 51%

Australian Bureau of Statistics reported today that the country’s trade surplus shrank 51% to A$1.45 billion in November from A$2.96 billion the previous month as exports declined 4% to A$26.9 billion in the period.

Exports of non-rural goods fell 4%, other rural goods 11% and rural goods declined 1%.

However service exports increased by A$13 million.

The ABS said imports advanced 2% to A$25.5 billion in November from the previous month as other goods and consumption goods imports increased 67% and 2% respectively.

Intermediate and other merchandise goods imports declined 4% led by fuels and lubricants dropping 24%, while service imports edged up 1%.

Separately, the statistics bureau reported that the seasonally adjusted estimate for total dwelling units approved fell 12.8% from a month ago and 34.7% from a year earlier to 9,581 in November.

Private sector houses approved fell 9.7% from a month ago and 27% from the same period a year ago to 6,829 and private sector other dwelling approvals dipped 21.9% from October and 50.7% from a year ago to 2,433.

Macquarie Sells Margin Lending Portfolio, Issues Profit Warning

Macquarie Group Ltd. completed the sell of the bulk of its margin lending portfolio valued at A$1.5 billion to Leveraged Equities, a wholly owned subsidiary of Bendigo and Adelaide Bank Ltd. for a premium of A$52 billion.

The premium consideration will be paid in convertible preference shares issued by Bendigo and Adelaide Bank Ltd. The sell of the margin lending portfolio is forecasted to make a profit contribution of approximately A$43 million before tax and profit share.

Macquarie is looking to reduce funded assets by A$15 billion to focus on more profitable business. Initiatives worth A$12 billion have been completed so far and an additional A$3 billion will be completed by March 31, 2009.

The company noted that it has managed to increase retail deposits by 27% to A$11.9 billion at December 31, 2008 from September 30, 2008, while term funding rose 14% to A$36.5 billion in the review period.

Macquarie will make its regular operational briefing in February.

Gainers & Losers

Abacus Property led advancers in the ASX 200 index shares with a rise of 14.6% followed by rises in Goodman Corp. of 8.7%, in Macquarie DDR Trust of 8.3%, in Macquarie Countrywide of 7.3%, and NuFarm Ltd. of 4.3%.

Equinox Mine led decliners in the ASX 200 index shares with a fall of 20.7% followed by losses in Babcock & Brown of 17.2%, in Babcock & Brown of 16.7%, in Panoramic Resources of 14.3%, and Atlas Iron Ltd. of 13.7%.

Commodity stocks fell after crude oil for February delivery plunged 12% to $42.63 a barrel. Copper prices dipped 4.5% and gold prices shed $24.30 to $841.7 per barrel to per ounce.

Minara Resources declined 10.6%, Linc Energy dropped 9.5%, Nexus Energy shed 9% and Murchison Metals fell 8.6%.

Fortescue Metals Ships 15 million Tons of Iron Ore From May

Fortescue Metals Group reported today that it has shipped 15 million tons of iron ore from its Pilbara operation since commencing exports in May last year.

Fourth quarter shipments topped 6.3 million tons, with 2.6 million tons exported in December.

Production from the miner’s Cloudbreak mine in 2008 increased to 19.5 million tons.

Fortescue executive director operations Graeme Rowley commented, “We are continuing to fine-tune our operations and will increase mine, rail and port tonnage through 2009.”