Australian Stocks Up; Fonterra in Saudi Deal

Mayank Mehta
15 Dec, 2009
New York City

Stocks in Australia are expected to edge higher. The Australian dollar edged up against the euro but hovers near its recent high against the dollar. The index of leading economic indicators suggests a steady recovery. Fonterra agreed to acquire 51% stake from its partner in a Saudi Arabian venture.

[R]7:00 AM Sydney, Australia – Stocks in Australia are expected to edge higher in the morning. The Australian dollar edged up against the euro but hovers near its recent high against the dollar. The index of leading economic indicators suggests a steady recovery in the economy. Fonterra Cooperative agreed to acquire 51% stake from its partner in Saudi Arabian venture.[/R]

The index of leading economic indicators increased 0.4 percentage point in October to 256.4 from September. The seasonally adjusted index gained at 6.7%. The data was released by Westepac Banking Corp and the Melbourne Institute.

ASX 200 index in Australia increased 19.50 or 0.42% to 4,673.50 and of the stocks in S&P ASX 200 index, 100 increased, 86 declined and 14 were unchanged.

Fonterra Cooperative Group Ltd agreed to acquire 51% stake from its joint venture partner Saudi Dairy & Foodstuff Co. for NZ$45 million or $33 million. The deal requires Saudi government according to a statement from the Auckland based largest dairy company in the world.

The Arab Free Trade Agreement will provide the dairy an access to wider region of the six Gulf Cooperation Council states and serve as a base for the Eastern Europe and northern African markets.

ASX Movers

Boart Longyear Limited led the decliners in the S&P ASX 200 index with a loss of 5.5% followed by losses in Murchison Metals Limited of 3.7%, in Medusa Mining Limited of 3.7%, in Abacus Property Group 3.6% and in Astro Japan Property Trust 3.5%.

Platinum Australia Limited led gainers in the S&P ASX 200 index with a rise of 7.9% followed by gains in Paladin Energy Ltd 5.7%, in PaperlinX Limited of 5.4% and in Alumina Limited of 5.1%.

Other Movers

Aquarius Platinum Limited advanced 4.7% to A$6.65 after the producer of the metal said that BlackRock Investment Management (Australia) Limited has a holding interest of 41.87 million ordinary shares representing 9.06% of issued share capital of the company.

Boart Longyear Limited an integrated provider of drilling services declined 5.5% to A$0.34.

GPT Group gained 1.7% to A$0.57 after the property trust was upgraded to “hold” from “sell” at Paterson Securities.

Kingsgate Consolidated Limited decreased 2.0% to A$8.90 after the company was downgraded to “neutral” from “outperform” at Macquarie Research.

Murchison Metals Limited the project development and iron ore mining operations dropped 3.7% to A$2.03.

Newcrest Mining Limited added 2.0% to A$35.89 after the gold producer said that BlackRock Investment Management (Australia) Limited has a holding interest of 71 million shares representing14.7% of the company.

Platinum Australia Limited which owns mines in South Africa and Australia climbed 7.9% to A$0.95.

PaperlinX Limited increased 5.4% to A$0.58 after the distribution and sale of printing and publishing papers is targeting UK packaging sector growth by opening a new business outfit that will cover deliveries across the UK.

Qantas Airways Limited rose 0.7% to A$2.69 after the airline was upgraded to “buy” from “neutral” by analysts at Bank of America Merrill Lynch and the government is likely to relax foreign investments rules in the airline.