Australian Dollar, Stocks Gain on Commodities

123jump.com Staff
14 Oct, 2009
New York City

Rally in Australian and Asian markets spread to Europe and Americas as commodities prices advance and investor sentiment improve. Better than expected economic data in the U.S., China and UK lifted worldwide sentiment.

[R]7:00 AM Sydney, Australia – Rally in Australian and Asian markets spread to Europe and Americas as commodities prices advance and investor sentiment improve. Better than expected economic data in the U.S., China and UK lifted worldwide sentiment.[/R]

World markets rallied on the back of improved sentiment and better than expected economic data.

China reported smallest decline in exports in September that sparked a rally in commodities. UK reported record unemployment rate of 7.9% but the quarterly increase in jobless people was the smallest in a year. U.S. reported smaller than expected decline in retail sales and strong earnings from Intel, JP Morgan Chase and CSX.

In New York trading, the Dow increased above 10,000 for the first time since October 3 close in 2008. The gain of 1.5% today lifted the index to 10,015.86 and it has rebounded 53% from its low on March 9. The index is still 29% below its high of 14,164.53.

ASX 200 index in Australia increased 45.40 or 0.95% to 4,831.10 and of the stocks in S&P ASX 200 index, 111 increased, 69 declined and 20 were unchanged.

In Australia, Rio Tinto reported an increase of production in the quarter ending in September and revised production target for iron ore for the year.

Copper prices increased after China increased its copper imports 23% to 399,052 tons in August.

The Australian dollar gained 0.7% to close at 91.47 U.S. cents. The Australian dollar increased to a 14-month high on the better than expected economic outlook from China and U.S.

ASX Movers

Energy World Corporation Limited led the decliners in the S&P ASX 200 index with a loss of 5.1% followed by losses in Elders Limited of 4.1%, in iSOFT Group Limited of 3.4%, in Goodman Fielder Limited 2.9% and in Minara Resources Limited 2.9%.

Karoon Gas Australia Ltd led gainers in the S&P ASX 200 index with a rise of 10.4% followed by gains in Sundance Resources Limited 10.0%, in Lynas Corporation Limited of 6.3% and in St Barbara Limited of 6.1%.

Other Movers

Banks closed higher on a rally in financials and resource stocks. Commonwealth Bank of Australia increased 2.5% to A$54.97, ANZ Bank increased 0.7% to A$24.80 and National Australian Bank added 1.4% to A$31.92.

Energy World Corporation Limited fell 5.1% to A$0.55.

Elders Limited dropped 4.1% to A$0.23.

Harvey Norman Holdings Limited the furniture and electrical retailer advanced 2.2% to A$4.64.

iSOFT Group Limited fell 3.4% to A$0.83 after the health information technology company said it raised A$12.9 million under the share purchase plan which closed on October 6.

JB Hi-Fi Limited rose 4.9% to A$19.42 and the retailer of home consumer products cited recent government stimulus program and low product prices driving sales at the company. The company expects to deliver 20% increase in sales in 2009.

Karoon Gas Australia Ltd surged 10.4% to A$8.37.

Lihir Gold gained 4.1% to A$3.33 and Newcrest Mining increased 2.3% to A$37.10 after gold flirted with new highs in Australia and London. Lihir is also expected to pay dividend as gold prices surge ahead in recent months.

Lynas Corporation Limited increased 6.3% to A$0.59.

Rio Tinto Limited the mining company rose 1.7% to A$63.25. The mining company said global iron ore production was up 12%, Pilbara iron ore production of 57 million tons up 18% on the third quarter of 2008.

Rio in its quarterly production review lifted its iron ore production target between 210 million tons and 215 million tons from the previous estimate of 200 million tons.

Bauxite production was down 16% and aluminum down 4% compared with the third quarter of 2008. Mined copper production increased 24% and refined copper production surged 46% compared to the third quarter of 2008. Australian hard coking coal was down 5% compared to the third quarter a year ago.

Sundance Resources Limited increased 10.0% to A$0.16 after the exploration of iron ore said the global economic slowdown has forced it to delay its target for initial production at its Mbalam iron ore project in Cameroon by two years to 2013.

Woolworths Limited the retailer added 1.3% to A$29.23.