New Zealand Rate at 2.5%; Woodside Strike

Darlington Musarurwa
28 Jan, 2010
New York City

Stocks in Australia edged higher. Australia median house prices rise 12.1% in December. New Zealand holds its benchmark rate at 2.5%. Woodside Petroleum Ltd said that only half of striking workers have returned to Pluto project work defying a court order.

[R]3:00 AM New York, 7:00 PM Sydney – Stocks in Australia edged higher. Australia median house prices rise 12.1% in December. New Zealand holds its benchmark rate at 2.5%. Woodside Petroleum Ltd said that only half of striking workers have returned to Pluto project work defying a court order.[/R]

Market indexes in Australia and Asia closed higher after the U.S. President Obama speech bolstered enthusiasm for global markets recovery. U.S. small businesses are struggling to get new loans and unemployment is near 10%. Obama also noted that the worst of the financial crisis is “behind” but now we have to deal with “devastation.”

In addition, new home sales in Australia rose in December and in 2009 at a rapid pace since 2003.

In Sydney trading ASX 200 Index edged up 0.6% or 28.7 to 4,673.30.

Of the ASX 200 index stocks, 116 gained, 67 fell, and 17 were unchanged. Charter Hall Group led gainers in the index shares with a rise of 7.4% followed by Goodman Group climbing 7%.

The Australian dollar increased 0.5% to 89.96 U.S. cents.

Median House Prices Rise 12.1% in Dec

Australian Property Monitors reported today that the country’s median house prices rose 4.8% in December and advanced 12.1% in 2009, rising the most since 2003.

All housing markets, except in Perth rose to the highest, with median prices jumping 18.5% in Melbourne.

Prices in Sydney gained 12.1%, Brisbane 7.7%, Perth 8.7% and Canberra 10%.

APM economist Matthew Bell said activity at the top end of the market drove “the extraordinary result.”

The report notes that activity at the top end is mainly spurred by a resilient job market and a rising stock market.

“Rising interest rates and the full expiry of the First Home Owner Boost at the end of December are likely to continue to slow activity for first home buyers, while the recovery of top end prices to pre-GFC levels means that median price growth is likely to moderate across all sectors of the market in the first half of 2010,” said Bell.

New Zealand Holds Rates at 2.5%

Reserve Bank of New Zealand left its official cash rate unchanged at 2.5%.

According to the central bank, though there are indications of recovery by New Zealand trading partners, sustained growth still remains uncertain on impaired financial sectors and overall capacity.

Reserve Bank Governor Alan Bollard said, “If the economy continues to recover in line with our December projections, we would expect to begin removing policy stimulus around the middle of 2010.”

ASX Movers

Billabong International Limited led the decliners in the S&P ASX 200 index with a loss of 3.4% followed by losses in Dominion Mining Limited of 3.4%, in Avoca Resources Limited of 2.8%, in Boart Longyear Limited 2.8% and in Medusa Mining Limited 2.7%.

Charter Hall Group led gainers in the S&P ASX 200 index with a rise of 7.3% followed by gains in Goodman Group 7.0%, in Hastie Group Limited of 5.5% and in Bendigo and Adelaide Bank Limited of 5.2%.

Other Movers

Arrow Energy Limited climbed 1.9% to A$4.18 after the company announced a 50.3% increase in proven and probable reserves to 6,150 petajoules.

ASX Limited increased 2.9% to A$34.77 after the owner of the Australian Stock Exchange was upgraded to “buy-short term buy” from “neutral” by UBS AG.

BHP Billiton plc rose 0.9% to A$40.70 after the mining company was seeking a quarterly contract on coal in talks with Japanese steelmakers.

CSL Limited the biopharmaceutical company fell 1.5% to A$30.85.

Oil Search Limited the oil and gas producer fell 1.1% to A$5.36 and Metgasco Limited the explorer searching for gas surged 21.1% to A$0.74.

Patrys Limited surged 53.8% to A$0.20 after the developer of cancer treatments announced that it has entered into an agreement with CSL Limited that is focused on several Patrys antibody therapeutic candidates.

ResMed Inc fell 0.3% to A$5.85 after the maker of masks and ventilators for breathing-related sleep disorders was upgraded to “overweight” from “equalweight” at Morgan Stanley.

Westfield Group the owner of shopping malls added 4.1% to A$12.71 and Woolworths Limited the retailer decreased 2.2% to A$26.19.

Woodside Petroleum Ltd said that only half the 3,200 workers working on Pluto project have returned to work defying a court order that may cost workers as much as A$22,000 and imprisonment.

Workers are protesting the practice of “modelling” that requires them to change to a new housing every month. Pluto project is one of the twelve mega projects that will build facilities to process and collect natural gas.

Woodside closed up 1.5% to A$43.69.