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Market Update

Six Year Low Commodities Prices Weigh on Australian Stocks


Author: Marcus Jacob
ticker.com
Last Update: 7:53 AM ET November 23 2015

5:30 PM Sydney, Australia – Stocks in Sydney trading struggled after commodities prices reached a 6-year low. Deal news lifted the market sentiment after Woolworths is looking to sell its struggling retail unit and Veda Group advised shareholders to accept $2.5 billion deal from Equifax.

Stock markets in Sydney came under pressure from falling commodity prices, which reached their lowest level in six years.

Copper, coal and iron ore dropped to a new low not seen since 2009 in London and Sydney trading and trading volumes were thin on both exchanges.

However, market indexes closed higher after deal news related to Woolworths and Veda Group.

Veda Group advised its investors to accept the takeover offer for $2.5 billion from the U.S.-based rival Equifax.

Macquarie plans to offer capital notes for as much as $400 million to the retail and institutional investors.

Woolworths is likely to sell its underperforming discount variety chain Big W and, reportedly, Blackstone and TPG global private equity groups are interested in purchasing the unit.

The Australian dollar eased to 71.82 U.S. cents, while in stock trading turnover reached 792 million shares worth $4.9 billion.

At the close, the ASX 200 Index rose 20.30 or 0.4% to 5,276.40 and the broader All Ordinaries Index gained 21 to 5,326.50.

In commodities trading, gold declined US$13 to US$1,071 an ounce and Brent crude future for immediate month delivery decreased 81 cents to US$43.85 a barrel.

Australian Stock Movers

Veda Group Ltd jumped 2.2% to $2.75 after the credit analytical data provider unanimously recommended to its investors to accept the takeover offer from the U.S.-based rival Equifax Inc for $2.83 per share, or a total of about $2.4 billion, .

Macquarie Group Ltd slid 0.1% to $82.91 after the financial services provider announced plans to offer capital notes for $400 million to retail and institutional investors.

Monadelphous Group Limited fell 1.3% $6.62 after the engineering company secured a long-term contract worth more than $200 million. The contract is associated with Shell Australia’s Prelude Floating Liquefied Natural Gas Project located in the north coast of Western Australia.

Woolworths Limited soared 3.9% to $24.63 on reports that the food, liquor and petroleum products company may sell its underperforming discount variety chain Big W.

The global private equity groups Blackstone and TPG may be interested in purchasing the struggling unit of Woolworths.

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