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Market Update

Australian Housing Loans Gains 1%, Rio Swings to Annual Net Profit


Author: Marcus Jacob
ticker.com
Last Update: 11:50 AM ET February 14 2014

5:00 PM Sydney – Australian market indexes advanced 0.9% on Friday and soared nearly 3% in the week. Total housing loans increased 1% in December in Australia but fell 1.5% when adjusted for seasonal factors. Rio Tinto swung to profit on record production. Newcrest Mining net plunged on write downs and $120 million tax bill.

Stocks in Sydney closed higher and banks and financial companies increased loan commitment across all sectors.

Total value of owner occupied housing commitments increased 1% in December and declined 1.5% in the month after adjusting for seasonal factors, Australian Bureau of Statistics report released today showed.

Total finance commitments in the month increased 0.3% from the previous month and fixed lending commitments increased 0.7% and revolving credit commitments declined 0.4%.

Adjusting for season factors, the value of total personal finance commitments decreased 1.1% and revolving credit declined 4% and fixed lending increased 1%.

Investors also digested the latest stable inflation data from China. Consumer price index increased in January 2.5% from a year ago and factory gate price index or a measure of wholesale prices declined 1.6%, according to China’s statistics agency.

The inflation measure was flat from December and most of the increase in inflation was driven by 3.7% advance in food prices last month.

For the year 2013, the inflation index increased 2.6% matching the index increase in 2012 but the inflation increase was below the government target of 3.5%.

ASX 200 index increased 48 or 0.9% to 5,356 and added 190 points of nearly 3% in the week.

In trading, stock turnover increased to 726 million shares worth $4.5 billion and banks and resource companies led the gainers.

The Aussie dollar gained to close at 89.93 U.S. cents and added 1 cent in the week and the gold closed at a weekly high of US$1,306.03 and added nearly 4% in the week.

Stocks in Review

ASX Limited, the operator of Australian Securities Exchange lifted first-half net outlook by 10.8% to $190 million and CEO Elmer Funke Kupper said all revenue segments registered growth in the period for the first time since the global financial crisis in 2008.

Newcrest Mining Limited fell 1.9% to $11.05 and the precious metals miner reported fiscal first half profit plunged to $40 million from $323 million a year ago. The company blamed 13% decline in gold prices, asset write down in Africa and $120 million tax bill.

Rio Tinto Limited gained 0.1% to $67.90 after the mining company swung to annual profit of US$3.67 billion from US$3.3 billion the prior year on asset write downs linked acquisitions in Canada. The resource company also increased its full-year dividend 15%.

The underlying earnings increased to US$10.2 billion after the company achieved record production and completed five major capital projects.

Sims Metal Management Limited gained 6.8% after the metal trader said first statutory profit doubled to $9 million and also reported a decline in net outstanding debt. The company also issued cautious second half outlook.

Qantas Airways Limited added 2.5% and the company said its discount carrier Jetstar will begin code sharing with Emirates to more destinations in Australia and New Zealand.

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