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Market Update

Australian Capex Falls 4.4%, Mirvac Asset Sale to Raise $450 M

Author: Marcus Jacob
Last Update: 10:44 AM ET May 28 2015

5:30 PM Sydney Market averages in Sydney turned lower after capital expenditure in the first-quarter declined 4.4%. Australian dollar edged lower. Mirvac Group said it plans to sell assets and raise as much as $450 million.

Market indexes in Sydney opened higher but struggled to hold gains by mid-day and averages turned lower on a weakness in resource stocks.

Seasonally adjusted private capital expenditure in first-quarter declined 4.4% to $35.90 billion compared to unchange from fourth-quarter, the Australian Bureau of Statistics said today.

For the year, private capital expenditure was plunged 5.3%.

Australian dollar closed at 76.98 U.S. cents and in stock trading turnover slipped to 682 million shares worth $4.9 billion.

At close, the ASX 200 Index fell 12.20 or 0.2% to 5,713.10 and the broader All Ordinaries Index decreased 9.60 to 5,724.20.

In commodities trading, gold slid US$1 to US$1,188 an ounce and Brent crude gained 0.70 cents to close at US$62.76 a barrel.

Australian Stock Movers

ALS Ltd plunged 6.1% to $6.04 after the laboratory testing services provider reported total revenues in the year ending in March fell 0.7% to $1.49 billion form $1.50 billion in a year ago period.

Net in the year swung to a loss of $174.5 million compared to profit of $154.4 million and diluted loss per share swung to a 43.4 cents from diluted earnings per share of 40.7 cents in the same period a year ago.

The company said statutory loss was primarily due to non-cash impairment charges of $290.6 million after-tax and in-line as guided in April.

Fortescue Metals Group Limited jumped 2.9% to $2.43 after chairman Andrew Forrest said the company is not interested in selling stake to Chinese investors after meeting several prospective buyers.

Separately, the third largest iron ore miner defended an ongoing tax investigation in Singapore and justified the use of shipping and trading company for ore transportation.

Separately Andrew said he will not sell his stake in the company despite the meetings with the Chinese investors.

Mirvac Group closed unchanged at $2.01 after the property developer plans to sell offices and retail malls in Sydney, Port Melbourne, Canberra and Bundaberg in Queensland to public and private investors and raise $405 million.

Chief executive Susan Lloyd-Hurwitz said the company plans to divest asset between $200 million to $400 million in this financial year.

MYOB Group Ltd declined 3.3% to $3.47 after the accounting software developer agreed to acquire New Zealand-based Ace Payroll Plus Ltd for about $13.2 million.

Rio Tinto Limited gained 0.5% to $57.65 after the mining company awarded five-year contract worth $20 million to Empire Limited to provide application managed services and project services.

Sources: Data collected by 123jump.com and Ticker.com from company press releases, filings and corporate websites. Market data: BATS Exchange. Inc