Australian Confidence Falls, Billabong Plunges

123jump.com Staff
20 May, 2009
New York City

The Australian consumer index declined in May, as it has every month for the last one year. The Australian wages increased at a slower pace in the first quarter. The dollar declined. Billabong International plunges 20% after it completes institutional offering.

[R]8:00 PM Sydney, Australia – The Australian consumer index declined in May, as it has every month for the last one year. The Australian wages increased at a slower pace in the first quarter. The dollar declined.[/R]

Australian consumer index in May declined to 88.8% in May, a decline of 4.4 percentage point from April. The rising government debt, lack of visibility for the employment and worries related to home values contributed to the weakness.

Australian government has embarked on deficit spending to take up the slack from the private sector. In the current fiscal year ending in June, Australia is expected to register a deficit of A$32.1 billion and in the next fiscal year the deficit is expected to balloon A57.6 billion.

Australian Bureau of Statistics reported that wage price index increased at annual rate of 4.2% in the first quarter after rising at 4.3% in the fourth quarter. Though the index declined from the previous quarter rate, it is still higher than most employers will like.

Wages increased more than 4% in mining, construction, utilities operators and education segments of the economy.

The ASX 200 index in Australia increased 7.30 or 0.2% closed to 3,824.60. The Australian dollar declined to 77 U.S. cents after the weak consumer confidence report.

Gainers & Losers

ABB Grains Ltd closed up 1.7% to A$8.75 after it agreed to a merger with Canada based Viterra Inc. The company received higher offer after it terminated its merger discussion with AWB Ltd.

AWB Ltd. dropped 11.3% to 94.5 cents after it reported first half profit decline of 62%, in line with its previous guidance.

Billabong International Ltd. declined 21% to A$8.45 after it raised A$230 million in an offering that was priced at A$7.50 a share. Goldman Sachs led the offering.

BHP Billiton Limited increased 1% to A$34.20 and Rio Tinto Limited added 1.6% to A$64.79.

Santos Limited increased 0.3% to A$14.80 and Westfield Group added 2.6% to A$10.22.

ASX 200 Index Movers

Billabong International Limited led the decliners in the ASX 200 index of 20.4% followed by losses in Elders Limited of 16.6%, in AWB Ltd of 11.2%, in Paperlinx Limited of 8.8% and in IOOF Holdings Ltd of 7.6%.

Goodman Group led gainers in the ASX 200 index with a rise of 14.8% followed by gains in Murchison Metals Limited of 10.7%, in Mirvac Group of 10.1% and Western Areas NL of 8.8%.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 54.35 or 0.6% to 9,344.64, Hang Seng index in Hong Kong decreased 68.19 or 0.39% closed to 17,475.84, CSI 300 index in China lower 27.22 or 1% closed to 2,812.86. ASX 200 index in Australia increased 7.30 or 0.2% closed to 3,824.60. The KL Composite index in Malaysia higher 19.14 or 1.9% closed to 1,042.63.

The Kospi Index in South Korea increased 7.49 or 0.5% to close at 1,435.70. SET index in Thailand closed higher 4.94 or 0.9% to 561.41 and JSE Index in Indonesia decreased 0.29 or 0.02% closed to 1,885.72. The Sensex index in India decreased 241.37 or 1.7% closed to 14,060.66.