Sydney, Dec 5, 2008 AEST (ABN Newswire) - US stocks fell for the first time in three days, on concern of General Motors' possibility of bankruptcy and Merrill Lynch's prediction that oil will hit $US25 a barrel hit the energy shares.
Australian stocks ended flat for a second day after an early rally sparked by Babcock & Brown's winning of a reprieve from bankers loses steam. Yesterday, the benchmark S&P/ASX200 share index ended little changed for a second day running, giving up just 1.4 points to 3542.4, while the All Ordinaries index ended down 0.2%, or 8.4 points, at 3468.1. Earlier, the indexes climbed about 2%. It is anticipated that the energy and mining sectors will plunge after the commodities price lowered with poor outlook and concerns over companies' ability of debt refinancing in a short term may weigh on the stocks.
In recent trading, the Share Price Index futures were down 41 points to 3,500 on the Sydney Futures exchange.
The Australian dollar opened marginally firmer after US Federal Reserve chairman Ben Bernanke said more government funding was needed to prevent home foreclosures. At 0700 AEDT, the Australian dollar was trading at $US0.6455/59, up from Thursday's close of $US0.6449/52.
Oil prices tumbled to their weakest levels in nearly four years overnight as investors fixated on mounting signs of recession in the global economy. On the New York Mercantile Exchange, light, sweet crude for January delivery settled at $US43.67 a barrel, down $US3.12 from yesterday's close.
Key Economic Facts and Figures
Car sales fell by more than 22 percent in November compared to a year earlier, as the global financial crisis put the brakes on Australia's economy, the Federal Chamber of Automotive Industries said. Last month 71,647 new cars and trucks were sold by retailers, down 20,434 -- or 22.2 per cent -- on the 92,081 units sold in November 2007.
National building approvals fell 5.4 per cent to 10,730 units in October, seasonally adjusted, the Australian Bureau of Statistics said. It slumped to a seven and a half year low in October as fears about the global economy stopped borrowers from taking advantage of a massive interest rate cut. But economists say building activity will recover in November and December as consumers belatedly respond to a series of big rate cuts.
The seasonally-adjusted A$2.95 billion surplus for October was largely the result of a 20 per cent surge in coal exports, Australian Bureau of Statistics (ABS) data released on Thursday shows. Economists had expected a surplus of A$1.6 billion,
Today the Australian Industry Group/Housing Industry Association will release Australian Performance of Construction Index for November.
M&A News
Straits Resources(ASX:SRL), an Australian copper, gold and coal mining company, is in talks to sell a US$264 million controlling stake in its Singapore-listed Straits Asia Resources(SIN:AJ1). It has received offers from financial companies, traders, power producers and mining companies for its 47.1-per-cent stake in Straits Asia Resources.
Australian iron ore exploration company Apollo Minerals Ltd(ASX:AON) said it is looking to acquire other projects to take advantage of current low valuations. Apollo said its A$4.7 million cash pile is sufficient to cover the initial exploration phase of the company's main project -- Mt Oscar.
Felix Resources Ltd(ASX:FLX) has confirmed there is takeover interest in the coal miner. Shares in Australian coal miner Felix Resources Ltd surged 83.8 percent after a media report said China's Yanzhou Coal Mining Co Ltd(SHA:600188) was is in talks to buy Felix for more than A$3 billion.
Important Corporate News
Oz Minerals's(ASX:OZL) problems could extend beyond the refinancing of A$1 billion of debt. The company revealed yesterday that its cash balance has deteriorated so rapidly in five months that analysts are concerned its working capital position will be "tight" even if it manages to refinance its debt.
Macquarie Group(ASX:MQG) is said to cut more than 100 staff across its Australian investment banking arm shown the door yesterday. A Macquarie spokeswoman refused to confirm the numbers involved yesterday or even to say that the job losses had taken place.
Crown(ASX:CWN) has attempted to allay fears about its hefty debt load by refinancing A$1.6 billion of debt before it is due, a move which also leaves it with a $US900 million war chest that could be used to pick up further casino assets on the cheap.
Agricultural chemicals group Nufarm(ASX:NUF) has reaffirmed its guidance for fiscal 2009 despite lower-than-forecast sales in Brazil, and says it is on a sound financial footing. The company said, in the first quarter of 2009, Nufarm's businesses in Europe and North America were tracking ahead of forecasts, Australian sales were relatively subdued, and the market in Brazil was weaker.
1. Related Stocks - Mid Market (AEST 1230)
-------------------------------------------------Code % Change Volume Turnover Low High-------------------------------------------------ASX:MQG +1.34 484,215 $15,679,100 2769 2868ASX:FLX +41.36 1,397,759 $11,444,207 750 1048ASX:NUF +3.64 454,464 $3,998,119 857 895ASX:QGC -.17 1,876,861 $10,792,018 575 576ASX:CWN -2.2 472,915 $2,293,852 479 491ASX:SRL -2.22 1,822,199 $1,553,961 80 94.5ASX:AAR +58.33 7,143,691 $132,501 1.7 2ASX:MTU -7.01 33,256 $17,826 53 57
2. Top 10 ASX on Turnover - Mid Market (AEST 1230)
-------------------------------------------------Code % Change Volume Turnover Low High-------------------------------------------------ASX:BHP -4.87 10,644,675 $281,529,877 2605 2670ASX:RIO -5.38 5,548,943 $197,346,961 2991 3080ASX:NAB +1.95 3,323,175 $69,753,802 1920 1994ASX:ANZ +.41 4,777,995 $68,274,681 1391 1448ASX:WBC +.35 3,074,673 $54,119,637 1670 1723ASX:CBA -.5 1,633,080 $53,465,370 3105 3200ASX:QBE +.16 1,750,547 $43,774,228 2450 2545ASX:WPL -1.89 906,262 $27,828,324 3000 3111ASX:CSL -.4 840,531 $26,700,139 3131 3247
Contact
Michelle Liang
Asia Business News Asia Bureau
Tel: +61-2-9247-4344
Email: michelle.Liang@abnnewswire.net
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