Australian Stocks Look Up; Myer IPO

123jump.com Staff
28 Sep, 2009
New York City

Australian stocks declined after the G-20 meeting failed to declare any new measures to sustain the global economic recovery. Nufarm Limited led gainers after it entered in talks with China based Sinochem that may lead to a takeover. Retailers closed mixed and banks edged lower.

[R]8:00 AM Sydney, Australia – Australian stocks declined after the G-20 meeting failed to declare any new measures to sustain the global economic recovery. Nufarm Limited led gainers after it entered in talks with China based Sinochem that may lead to a takeover. Retailers closed mixed and banks edged lower.[/R]

Australian stocks are expected to open higher after a rally in European and New York markets. Merger deals worth $11 billion lifted mood among traders despite weak trading. European markets closed higher as Germany returned Angela Merkel led parties with highest share of votes.

Australian stocks fell in Monday’s trading as markets awaited the start of earnings season in a week and lack of positive news from the G-20 summit.

ASX 200 index in Australia decreased 35.90 or 0.76% to 4,677.40 and of the stocks in the index, 34 increased, 153 declined and 13 were unchanged.

Australian dollar declined as the yen edged higher against the euro and the dollar. The Aussie dollar slipped to 86.43 US cents.

ASX Movers

Gunns Limited led the decliners in the S&P ASX 200 index with a loss of 9.8% followed by losses in Karoon Gas Australia Ltd of 7.8%, in Aquila Resources Limited of 7.3%, in Medusa Mining Limited 6.3% and in Alesco Corporation Ltd of 6.2%.

Nufarm Limited led gainers in the S&P ASX 200 index with a rise of 7.3% followed by gains in Infigen Energy 5.3%, in Commonwealth Property Office Fund of 3.2% and in Fleetwood Corporation Limited of 3.2%.

Other Movers

The trading volume in Sydney declined to 2.47 billion shares worth A$4.27 billion as 408 stocks declined, 668 increased and 326 were unchanged.

Babcock & Brown Power surged 24.6% to A$0.08 after the electricity producer said that made substantial progress in commercial negotiations in relation to the restructuring of the debt. Separately the electricity producer said full-year revenues rose 1,526% to A$68.3 million from A$4.2 million a year ago. Net loss for the full-year was A$352.8 million compared to net loss of A$202.8 million a year ago.

David Jones Limited added 1.7% to A$5.71 as investors traded mixed. Woolworths declined 0.6% to A$28.96 and Wesfarmers dropped 2% to A$26.09.

Eden Energy Ltd jumped 45.5% to A$0.11 after the diversified energy company said that it has entered into an agreement with Origin Energy Limited to farm-in to the company''s cooper basin geothermal licence No. 185 in South Australia. Origin will pay to the company A$1 million cash and will bear the first A$500,000 of expenditure on the licence to earn a 70% interest in GEL 185.

Karoon Gas Australia Ltd declined 7.8% to A$7.30 after the engaged in investment in hydrocarbon exploration said U.S. oil major ConocoPhillips has abandoned a key exploration well off Western Australia after disappointing drilling results partner Karoon Gas Ltd said.

Myer Group filed offering prospectus to raise A$2.4 billion that seeks a share price between A$3.40 and A$4.90. The largest public offering in two years is priced at between 14.3 and 17.3 times earnings that match other department store valuation. Goldman Sachs, Credit Suisse and Macquarie Group are managing the offering.

Nufarm Limited advanced 7.3% to A$11.96 after the agricultural chemicals supplier and China based chemicals trader Sinochem Corp enter into an agreement to explore a merger. The companies are expected to complete their negotiations by December 3 that may lead to an offer at A$13 a share. The shares gained despite the company reported 42% decline in annual profit.

Nufarm Limited, the agricultural chemical company said full-year revenues rose 7.6% to A$2.68 billion from A$2.49 billion a year ago. Net profit for the full-year fell 41.7% to A$79.9 million or 33.5 cents per diluted share compared to net profit of A$137.9 million or 69.7 cents per share a year ago.

Woodside Petroleum Ltd decreased 1.1% to A$51.80.