Shares swing to a loss as slump continues
The Australian sharemarket retreated Monday afternoon as weaker than expected jobs data rattled investor confidence in the sustainability of economic growth. Energy stocks slumped, while resources were also heavily sold.
In a range of economic data out this morning, the chances of a rate rise when the RBA meets this month have shortened after the TD Securities inflation gauge rose 0.8% in January, its third consecutive monthly increase.
In employment news, the ANZ Bank monthly job advertisement survey revealed an 8.1% drop in the total number of jobs advertised in major metropolitan newspapers and on the internet in January. Job advertisments rose a revised 4.6% the previous month.
Meanwhile the PMI, a measure of manufacturing, rose 2.5 points to 51 in January. The 50 point mark is the barrier between expansion and contraction. The growth was driven by a rise among construction materials and coal mining stocks the report concluded, while export levels also rose.
At the end of the day, the All Ords was down 52.1 to 4,544.8, while the ASX/200 shed 45.5 to 4,524.1. About 2.7 billion shares worth around $5.3 billion had changed hands.
The Materials and Resources sector lost 1.3% as most stocks reversed early gains.
Heavyweight miner BHP Billiton slid 20c, or 0.5% to $39.20, while Rio Tinto shrugged off a strong start to the session to finish 59c lower at $67.41.
Newcrest weakened 58c, or 1.8% to $30.95, while Lihir Gold fell 6c, or 2.2% to $2.71.
Several mid-capped stocks, including Onesteel, Bluescope and Incitec Pivot were between 3.9% and 5.9% in the red.
Alumina bounced back from losses on Friday with a 2.5c, or 1.6% gain to $1.565.
Aspiring Greenland minerals miner Greenland Minerals and Energy forecast solid cash flow following a feasibility study of its Kvanefjeld Project, which the company said could become the world’s largest rare earth mine. Investors were clearly unimpressed with the news - its shares slumped 16.7%.
Energy stocks showed weakness with the sector trading 2.5% lower. Woodside shed 74c, or 1.7% to $41.59.
Santos dropped 39c, or 3% to $12.79.
Uranium miner Extract Resources slumped 86c, or 10.9% to $7.04, while Arrow Energy fell 38c, or 9.7% to $3.55 after confirming it required additional funding due to taking on a greater role in the development of the Fisherman's Landing LNG project.
Smaller capped oil explorers were heavily sold with a number well over 5% below the gain line.
The big four banks finished mainly lower. ANZ advanced 7c, or 0.3% to $21.80 and CBA slid 25c, or 0.5% to $52.98.
Westpac and NAB lost 33c, or 1.4% to $23.53 and 27c, or 1% to $26.10 respectively.
The broader Banks and Financials slid 0.9%.
The insurers were mostly lower, with QBE down 32c, or 1.4% to $22.60.
The Property Trusts sector dipped 1.7% on the back of a 2.4% fall in the price of Westfield shares to $12.34.
Mirvac lost 4c to $1.415.
The Industrials sector slipped 1%.
Brambles shed 17c, or 2.6% to $6.38 and Leighton was down just 20c, or 0.5% to $38.00.
Meanwhile, mining engineering firm AJ Lucas shares tumbled more than 2.5% to $3.16 after reporting ‘disappointing’ results over the last six months.
Macquarie Airports bucked the trend, rallying 2.2% to $2.84.
Retailers Harvey Norman and David Jones rose 0.8% and 0.6% to $3.71 and $4.79. The broader Consumer Discretionary sector rose 0.5%.
Among the gamers Aristocrat surged over 11% to $4.41 after the gaming machine maker upgraded its forecast profit.
Navitas shares hit all-time highs this morning before eventually close at $4.61 after the global education provider posted its fifth consecutive quarter of increasing revenue.
The media sector was mixed, though Newscorp put on 21c, or 1.3% to $16.72.
The Consumer Staples sector was down 0.8%, with all the majors trading below the gain line.
Woolworths lost 35c, or 1.4% to $25.51.
Telstra shed 2c, or 0.6% to $3.32. The Telecommunications sector weakened 0.4%.
Ramsay Health Care climbed 43c, or 3.7% to $11.90 after the company said its first half core NPAT result for to 31 December last year was expected to be around 32% to 34% higher than the previous corresponding period.
The Healthcare sector slid 0.2% due largely to heavyweight CSL closing 28c lower at $30.90.
Around the region, the Nikkei 225 dipped 8.5 to 10,189.6, while the Straits Times Index shed 8.4 to 2,737.0. Meanwhile, the NZSE50 fell 13.7 to 3,151.0. The Hang Seng lost 109.9 to 20,012.1.
Spot gold was trading at US$1,079.00 per ounce, and the Aussie was buying US$0.8818.
Ramsay expects profit up by a third
Ramsay Health Care said its first half core NPAT result for the six months to 31 December last year was expected to be around 32% to 34% higher than the previous corresponding period. The result, the company said, was driven by a better than expected result from businesses in the UK and Australia.
At the close, shares in Ramsay Healthcare were up 43c to $11.90.
Gindalbie, Sinosteel sign agreement
Gindalbie Metals and Sinosteel Midwest Corporation announced the signing of an agreement, which would provide a framework for sharing access to infrastructure and mine services for their neighbouring projects in Western Australia’s iron ore region. In a statement released by Gindalbie today it said the agreement, between Sinosteel Midwest and Gindalbie’s joint venture company Karara Mining Limited, is designed to enhance project economics and unlock synergies between the Karara Iron Ore Project and Sinosteel Midwest’s nearby Koolanooka/Blue Hills Project.
At the end of the day, Gindalbie shares were down 3.5c to 91.5c.
Aristocrat expecting $116m profit
Aristocrat Leisure shares surged over 10% at the open after saying it was expecting to record a post-tax profit of around $116m for the year to 31 December, ahead of analysts’ expectations. Despite this the company said it would report a loss, after abnormal items, after tax and minority interest for the year.
By the finish, Aristocrat shares were up 44c to $4.41.
Navitas profit continues to climb
Navitas, a global education provider, reported its fifth consecutive quarter of revenue growth to post a net profit of $27.5m, up 45% on the previous corresponding period. The company said it was now expecting full year EBITDA of between $94 million and $97 million, against last year’s $77.1 million.
By the close, Navitas shares were up 13c to $4.61.
AJ Lucas paints poor outlook
AJ Lucas Group said it was on track to report a ‘disappointing’ first half result when it reports to the market at the end of this month. The engineering firm said normalised EBITDA was set to be negative $18 million, though expected to swing to a $30 million EBITDA gain in the second half.
At the final whistle, AJ Lucas shares were down 8c to $3.16.
ESG beats 2009 reserves target
Eastern Star Gas upgraded its Proven and Probable gas reserves of the Narrabri Coal Seam Gas Project in New South Wales as at 31 December 2009 by 152 % to 1,520 PJ, of which ESG’s net interest is 988 PJ. The company also increased its 3P reserves by 43% to 2,797 PJ, of which ESG’s net interest is 1,818 PJ.
At the finish, ESG shares were down 2.5c to 75c.
GGG boasts worlds largest rare earths mine
Greenland Minerals and Energy completed its pre-feasibility study, confirming the Kvanefjeld Project has the potential to become one of the world’s largest rare earth mines. The study forecast a Net Present Value of US$2.18 billion and free cash flow of US$8.9 billion over the life of the project.
By the close Monday, Greenland Minerals and Energy shares were down 11c to 55c.
Argo sees improving conditions
Argo Investments reported a 14.7% decline in profit for the six months to 31 December 2009 to $82.7m. The investment company said the result was despite the value of stock rising from $2.9 billion to $3.9 billion by year end, though the company had previously flagged a fall of between 25% and 28%.
At the finish, Argo shares were down 7c to $6.65.
IMF full-year result remains in question
IMF (Australia) expects to announce a first half gross profit of about $11m with an after tax profit of about $8m. As announced in August, the company said its full year forecast was based upon four cases coming to a successful conclusion during the 2010 financial year and if this is the case expects to achieve the forecast $20 million - $24 million in after tax profits for FY10.
By the close, IMF shares were up 5.5c to $1.585.
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