Australia | Jun 28 2013
By Stephen Hogan, Senior Private Client Adviser, Equities/Derivatives
Australian Market
The Australian market (XJO) closed down -8.7 points or 0.18% to 4802.6 today. It was a rollercoaster day on the market today with the XJO spending time in both positive and negative territory. The Dow Jones rose 114.35 points or 0.77% to 15,024.50 and we opened strong for 15 minutes then sold off to hit a low of 4795.6 at 11:30am and then moved to a high of 4832.1 just after 3pm. The market closed the financial year matching down over 8 points. Market sectors finished mixed today, the best performer was the ASX A-REIT sector gaining 0.99% and the worst was Information Technology, falling -1.55%.
WesTrac, a division of Seven Group Holdings Limited ((SVW)) reports that they are cutting 350 jobs in NSW and ACT as part of a restructure. WesTrac is chaired by Kerry Stokes and is a heavy machinery dealer, supplying Caterpiller machinery such as bulldozers and trucks to miners and builders. WesTrac Australia employs more than 3500 employees across 30 branches in Western Australia, NSW and the ACT. WesTrac said it had already introduced a series of efficiency and productivity initiatives over the past eight months in an effort to streamline its costs. ''But these measures alone have not been sufficient in view of continuing challenging market conditions.''
CSL Limited's ((CSL)) CEO Brian McNamee is finishing up at the company today, after 23 years at the health care products supplier. McNamee is set to earn $.9 million in one off payments in October when all ties with CSL are severed. The ex CEO could also be entitled to shares worth over $18 million over the next few years under long term incentive plans. While McNamee has been at the helm, CSL has grown from a small government enterprise to being a publicly listed company worth over $30 billion.
Kingsgate Consolidated Limited ((KCN)) will take a $300 million write-off against its Challenger gold mine in South Australia as it slashes output at the mine to cope with the slumping gold price. KCN bought Challenger for $376 million, with operations at the mine hit by a series of operating issues subsequently, which has restricted output and earnings from the mine. As a result of the Gold price moving lower, KCN said it will cut output at the mine to 70,000-80,000 ounces of gold annually, down from output which had been targeted at around 100,000 ounces annually.
The price of Gold has now moved lower than U.S. $1200, its lowest in nearly three years. Gold has slid nearly U.S. $200 an ounce in 10 days. It is down more than 28% for the year and is headed for a 25% loss for the second quarter, its biggest quarterly decline since at least 1968.
AUD is currently trading at $0.9275, up $0.0005 against the USD.
Top Performers
Discovery Metals Limited ((DML)) up $0.015 or 12.50% to $0.135
Emeco Holdings Limited ((EHL)) up $0.02 or 7.69% to $0.28
Paladin Energy Limited ((PDN)) up $0.055 or 6.71% to $0.875
Drillsearch Energy Limited ((DLS)) up $0.065 or 6.53% to $1.05
Mount Gibson Iron Limited ((MGX)) up $0.025 or 5.68% to $0.465
Bottom Performers
Caltex Australia Limited ((CTX)) down -$2.34 or -11.43% to $18.13
Cudeco Limited ((CDU)) down -$0.25 or -11.06% to $2.01
Billabong International Limited ((BBG)) down -$0.015 or -9.09% to $0.15
Kingsgate Consolidated Limited ((KCN)) down -$0.105 or -7.72% to $1.255
Panaust Limited ((PNA)) down -$0.115 or -5.93% to $1.825
Our Comments
With a lot of tax loss selling today hard to get any sort of grasp on what today's price action means for the market. It will be interesting to see how U.S. exchanges trade tonight and how the futures are looking for Monday morning.
Not surprised to see the banks were the out performers today, and no real selling to speak off.
(For a more comprehensive summary of last night’s market action see FNArena’s Overnight Report.)
Re-published with permission. Views expressed are not by association FNArena's (see our disclaimer).
Stephen Hogan is an Authorised Representative of Novus Capital. Authorised Representative No.345411 – http://www.stephenhogan.com.au
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