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Market Update

Australian Indexes Advance Overlooks 4% Drop in Iron Ore Price

Author: Marcus Jacob
Last Update: 9:26 AM ET June 02 2014

5:00 PM Sydney – Australian stocks rebounded and overlooked 4% decline in spot iron ore price. Home prices in capital cities declined 2% in May, the first monthly decline in a year. Ausdrill plunged 11% after the energy industry services provider lowered its annual outlook.

Australian stocks rebounded despite the fall in iron ore prices by additional 4% in international markets on Friday.

Australian dollar eased to 92.59 U.S. cents and stock market trading turnover declined to 658 million shares worth $4.05 billion.

ASX 200 index gained 26 or 0.5% to 5,518.50 and the broader All Ordinaries rose 25.40 to 5,499.20.

Home prices declined 2% in May, according to a private survey conducted by RP Data-Rismark. The price decline was the first in a year.

Home prices fell 3.6% in Melbourne and in Brisbane eased 1.7%. Prices in Sydney declined 1.1% and record 3,411 homes were auctioned off in the financial hub.

Stocks in Review

Ausdrill Limited plunged 11.3% to 86.5 cents after the mining and energy service provider revised its operating performance for the financial year ending in June and expects to report a net profit after-tax in the range of $25 million to $30 million down from earlier forecasts of about $35 million.

GPS Alliance Holdings Ltd closed unchanged at 16 cents after the Singapore-based building materials and equipment supplier signed a sale and purchase agreement with the sole shareholder of Forte Development Pte Ltd from Lee Boon Leng for the acquisition for S$55 million.

Karoon Gas Australia Limited surged 42.7% to $3.51 after the exploration company said it will sell its 40% interest in two offshore energy permits for the Browse Basin, off Australia’s west coast, to Origin Energy Ltd.

Under the terms, Origin will pay US$600 million in cash with additional payments of US$75 million on final investment decision and US$75 million on first production.

Shares of the Origin Energy Limited declined 3.6% to $14.55.

McAleese Ltd slipped 2% to 49 cents after the transport and logistic company lowered its earnings outlook for the second time and forecasted between $82 million and $85 million from $97 million earlier in the year.

RCG Corporation Limited plummeted 12.2% to 61 cents after the athletic footwear retailer lowered annual operating earnings margin in the range of 10% to 12% from the earlier projection of 15%.

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