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Market Update

Australian Index Drops 1% on Weak China Industrial Production Data

Author: Marcus Jacob
Last Update: 11:00 AM ET September 15 2014

5:00 PM Sydney, Australia Australian market indexes traded lower after iron price remained weak and the China fuelled resource boom continued to weaken. Industrial production growth in Chia in August slowed. Australian dollar closed below 90 U.S. cents for the first time in six months.

Stocks in Australian opened lower and traded down after China reported a decline in industrial production over the weekend.

The seasonally adjusted industrial production in August increased 6.9% from a year ago, down from 9% in July and the weakest growth since December 2008. The data were released by the National Bureau of Statistics.

The latest weakness in the Chinese data added to the weakening economic back drop with the declining real estate investment and falling retail sales. China is likely to miss its annual economic growth target of 7.5%.

Separately, domestic new vehicle sales in August declined 1.8% 3.5% from a year ago, Australian Bureau of Statistics reported today.

Australian dollar traded at 89.97 U.S. cents and in stock trading turnover jumped to 742 million shares worth $4.64 billion.

ASX 200 index slipped 57.60 or 1% to 5,473.50 and the broader All Ordinaries index dropped 56.90 to 5,475.40.

Stocks in Review

Arrium Limited closed unchanged at 65 cents after the mining company launched one-for-one re-nounceable entitlement offer to raise about $754 million to repay debt and strengthen its balance sheet.

Arrium is expected to raise additional $98 million with an institutional placement.

Fortescue Metals Group Limited rose 0.5% to $3.96 after the iron ore producer secured pipeline construction project for its North Star Magnetite worth a $10 million in a partnership with Viento Group Limited and Kimberley Pipelines.

Elders Limited surged 23.8% to 26 cents after the financial and real estate service provider lowered its EBIT forecast for the year to between $23 million and $28 million from $77 million a year ago period.

After trading halt. the company also plans to raise about $57 million.

Origin Energy Ltd slipped 1.1% to $15.11 after the electricity producer reported group revenue in the year ending in June dropped 3.1% to $2.45 billion from $2.53 billion a year ago period.

profit in the year surged 17.6% to $234 million compared to $199 million and diluted earnings per share jumped to 32 cents from 27.2 cents a year earlier.

Tabcorp Holdings Limited fell 0.5% to $3.61 after the diversified entertainment company reported revenue in the year ending in June jumped 2% to $2.04 billion from a year ago period.

Profit in the year climbed 2.6% to $129.9 million compared to $126.6 million and diluted earnings per share were flat at 17.1 cents from a year earlier.

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