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Market Update

Record Profits at ANZ, Kirin Acquires Strategic Stake in WCB

Author: Marcus Jacob
Last Update: 9:25 AM ET October 29 2013

4:30 PM Sydney – Australian market indexes declined in the afternoon and dollar fell after negative comments from RBA Governor Glenn Stevens. ANZ reported fifth annual earnings increase in a row and stock closed at a record high. Kirin has acquired a blocking stake in WCB.

Australian stocks traded lower and ANZ reported a surge in annual profit on rising lending and fees from other services.

Australian dollar dropped to 95.10 U.S. cents. In stock trading, turnover plummeted to 725 million shares worth $4.5 billion.

Australian dollar edged lower after RBA Governor Glenn Stevens said the dollar may be “materially lower” in the future.

Stevens added terms of trade are not expected to improve from here and “some point in the future the Australian dollar will be materially lower than it is today.”

Governor also added the U.S. economy is “healing” and Chinese economic activity appears to be “robust” and added that the Australian business and consumer sentiment has improved from a year ago.

The ASX 200 index dropped 25.90 or 0.5% to close at 5,415.50 and the broader All Ordinaries slid 26.60 to 5,410.70.

Stocks in Review

Rio Tinto dropped 97 cents to $63.41 and BHP fell 26 cents to $37.59. Woodside Petroleum Limited slid 15 cents to $38.65.

Westpac lowered 1 cent to $34.60.

Australia and New Zealand Banking Group gained 1.2% to $33.63 after the bank reported net profit for the year jumped 11% to $6.49 billion from $5.83 billion and operating income jumped 4% to $18.4 billion compared to $17.7 billion a year ago.

Suncorp Group Limited rose 0.2% to $13.37 after the insurance and banking services provider said it received 400 claims from the New South Wales bushfires with estimated cost of $60 million to $70 million.

Suncorp said total lending in the quarter grew 0.3% to $48.3 billion and natural hazard events allowance for the year reached at $565 million.

UGL Limited dropped 2.4% to $7.72 after the diversified services provider lowered its earnings forecasts for the year and chief executive and managing director, Richard Leupen said “operations in the short term impacted by the downturn in the resources sector and revenues in the engineering division are ‘‘at similar levels’’ to last year’.’

Warrnambool Cheese & Butter Factory Co soared 5.3% to $8.80 after the dairy products maker clarified that the company is unaware of the reasons why shares in the two groups spiked in morning trade, even after the ongoing takeover battle.

Lion Co. the unit of Japan-based Kirin Holdings Co Ltd confirmed that it acquired 9.99% stake at an average price of $9.19 per share in the company.

The price paid by Lion is higher than the one offered by Bega Cheese Ltd and Murray Goulburn Co-operative for takeover offer to Warrnambool Cheese & Butter.

Kirin acquired National Foods for $3.1 billion in 2007 and added Dairy Farmers for $910 million in 2008.

The current purchase of blocking stake will ensure that the company can have a say in the outcome of the merger battle and protect distribution of its cheese brands.

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