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Market Update

Australian Indexes Fall on Five-Year Low Iron Ore Price

Author: Marcus Jacob
Last Update: 12:04 PM ET September 24 2014

5:00 PM Sydney, Australia Australian market indexes slipped and banks and miners extended the decline as the ASX index has wiped out all the gains in the year so far. Australia lowered its estimate of iron ore price to $94 a ton from $105 a ton. Reserve Bank of Australia focused on curbing speculation in housing market.

Australian stocks extended losses in the month after banks and resource companies led the decliners and the Aussie dollar dropped to a new seven-month low.

The latest market decline was driven by another weakness in iron ore price and the spot price of the mineral fell to US$79.40 a ton.

Bureau of Resource Economic and Energy, the government agency lowered its estimate for the average price of iron ore to US$94 a ton from US$105 and added the near term outlook for the iron ore is poor.

Australian dollar traded at 88.75 U.S. cents and in stock trading turnover dropped to 706 million shares worth $4.48 billion.

ASX 200 index slipped 39.90 or 0.7% to 5,375.80 and the broader All Ordinaries index fell 40 to 5,375.90.

In addition, Reserve Bank of Australia focused on the tight housing market and said it will work with banks and lenders put additional restrictions to home loans issued to investors.

The mid-year financial stability report focused on the growing home prices across the nations and worries about the health of the Australian banks.

Stocks in Review

Australand Property Group fell 0.9% to $4.44 and the industrial property developer edged closer to wrap up its $2.6 billion merger with Singapore-based Frasers Centrepoint on September 4.

Frasers attracted 98.61% of all outstanding shares for its offer.

Fletcher Building Limited slumped 2.6% to $7.98 after the New Zealand based construction material distributor will exit the copper tube manufacturing business in Australia by the end of this year.

National Australia Bank Ltd slipped 1.4% to $33.04 after the bank seeking a potential buyer as it plans to sales its life insurance unit worth an estimated $800 million.

Nuplex Industries Ltd soared 6.2% to $2.92 after the polymer resins manufacturer is in talk with domestic buyer CHAMP Private Equity to sell two of its Australasian-based businesses.

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