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Market Update

Murdoch Disregards Shareholders Concerns and Elevates Lachlan

Author: Marcus Jacob
Last Update: 7:55 AM ET March 27 2014

5:00 PM Sydney Australian stocks trimmed losses after tensions rose between Russia and European nations. Aussie dollar eased. Rupert Murdoch elevated his son at News Corp and 21st Century Fox, a step that many view reflect weak corporate governance and nepotism at both companies.

Australian stocks opened sharply lower on the growing tensions between Russia and European nations and the U.S. The Aussie dollar eased and resource stocks declined.

Australian dollar eased to 92.39 U.S. cents and stock market trading turnover grew to 756 million shares worth $4.2 billion.

The ASX 200 index slumped 26.70 or 0.5% to 5,350.10 and the broader All Ordinaries slipped 27.50 to 5,359.70.

Stocks in Review

Rio Tinto fell 49 cents to $63.18. BHP slid 57 cents to $35.98. Woodside Petroleum Limited rose 3 cents to $38.43.

Westpac Banking Corp decreased 6 cents to $34.22.

David Jones Limited closed unchanged at $3.20 after the retailer said Goldman Sachs increased its holdings in the company to 9.2% stake from 8.2% earlier.

Lynas Corporation Limite surged 25% to 22.5 cents after the rare earth oxide producer said its commercial production and sales in March quarter are higher than the last quarter.

News Corp declined 2.4% and the company board announced the elevation of Lachlan Murdoch as non-executive co-chairman of the company. Lachlan will also assume the same position with at 21st Century Fox.

Rupert Murdoch, the father controls two companies with minority shareholders and many activist shareholders view this step as a succession plan that violates company governance and minority shareholder rights.

Singapore Telecommunications Ltd closed unchanged to $3.12 and the telecommunication service provider was warned by a communication regulator warned that it subsidiary Optus has sent overbilled customers between July 2011 and September 2012.

The regulator said nearly 237,500 customers subscribing SurePage and SpinCox services were affected by the billing error.

Washington H. Soul Pattinson and Co. Ltd fell 0.4% to $15.04 after the company said profit in the first-half slid 0.8% to $73.7 million from a year ago and cash reserves including wholly owned subsidiaries was $180 million.

The company declared 19 cents a share.

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