5:00 PM Sydney – Reserve Bank of Australia unexpectedly lowered its official interest rate by 25 basis points to 2.75%. Four largest banks said they will pass the full rate cut to investors. Market indexes rebounded from the low of the day but still closed down for the day.
Reserve Bank of Australia lowered its official interest rates to their lowest in more than fifty years.
The RBA cut the reference rate 25 basis points to 2.75% and four largest banks confirmed that they plan to pass on full rate cut to customers.
The ASX 200 index slid 12.50 to 5,143.70 and the broader All Ordinaries fell 11.10 to 5,122.70.
Australian dollar closed down to $1.019 against the U.S. dollar and in stock trading turnover increased to 828 million worth $4.7 billion.
The Australian Bureau of Statistics reported trade balance turned around after the 14th consecutive months of deficits in March and swung to $307 million surplus.
Australian construction sector shrank for the 35th consecutive month in April said by Australian Industry Group and Housing Industry Association.
Stocks in Review
Rio Tinto gained $1.19 to $57.39 and BHP jumped 80 cents to $33.67.
Woodside Petroleum Limited slid 10 cents to $37.08.
Whitehaven Coal Limited said coal railings in April were record 0.95 metric ton beating its previous record of 0.85 metric ton in January.
David Jones Limited fell 3 cents to $2.85 and Breville Group up 2 cents to $6.89.
Woolworths dropped 74 cents to $34.78.
Billabong International Limited was halted ahead of merger discussion update with a group of leverage buyout firms.
Mirvac Group slipped 5 cents to $1.68. Lend Lease increased 13 cents to $10.65.
Slater & Gordon Limited said it signed agreements to buy three UK based personal injury law firms and the company plans to raise $64 million to fund the expansion.
ANZ passed on in full latest 25 basis points rate cut to variable mortgage rate holders.
Westpac declined 59 cents to $32.58, Commonwealth slumped 1.9% to $70.30 and National Australia Bank fell 1.6% to $32.95 and ANZ slipped 1% to $31.19.
Telstra Corporation Limited won licenses in the spectrum auction for $1.3 billion and the payment is due in the third quarter of 2014.