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Market Update

Weak Gain in Australian Retail Sales Drag Indexes Down 1.9%

Author: Hiruki Nakamura
Last Update: 3:19 AM ET July 03 2013

5:30 PM Sydney Australian stocks sold off sharply after retail sales in May were lower than expected and global worries dragged market sentiment in Asian trading. New home sales rose for the third month in a row in May and reached an 18-month high.

Australian markets fell sharply in sympathy with market slide in Asia and rising global uncertainties.

Market sentiment was weak after persistent cash squeeze in China and elevated unemployment in the euro zone and also political crisis in Egypt.

In addition, domestic retail sales data were lower than expected.

The ASX 200 index declined 89.90 or 1.9% to close at 4,744.10 and the broader All Ordinaries slumped 82.50 to 4,727.80.

The Australian Bureau of Statistics said May trade surplus expanded nearly three-fold to $670 million as exports and imports increased in the month.

New home sales in May rose for the third straight month, the highest level in 18 months.

Activity in the services sector contracted for the 17th consecutive month despite edged up in June.

The Australian Bureau of Statistics also noted retail sales in the month of May slight rose. Retail sales in the month increased 0.1% to $21.82 billion, below estimate of 0.3% increase.

Australian dollar fell to a new 34-month low to 90.73 U.S. cents and in stock trading turnover rose to 843 million shares worth $4.8 billion.

Stocks in Review

Rio Tinto slumped $1.57 to $51.50 and BHP dropped $1.02 to $31.05.

Woodside Petroleum Limited decreased $1.20 to $34.62 and lowered its production guidance for the fiscal 2013 mainly due to unexpected shutdown at its Pluto LNG asset.

David Jones Limited fell 5 cents to $2.53 and Breville Group added 2 cents to $7.02. Woolworths declined 65 cents to $32.27.

Mirvac Group slid 4 cent to $1.60. Lend Lease slipped 11 cents to $8.47.

Westpac slumped 75 cents to $27.67, Commonwealth down 0.5% to $68.53 and National Australia Bank lowered 1.8% to $28.72.

ANZ dropped 61 cents to $27.87 launching capital notes to raised $750 million ahead of rival debt issue from Westpac Banking Corporation

Flight Centre Limited jumped 2.1% to $40.14 after the company estimated full-year profit before-tax at the higher end and lifted its underlying profit guidance from $338 million to $342 million. Earlier airliner expected between $305 million and $315 million.

The GPT Group dropped 3.1% to $3.79 after the asset manager sold its Brisbane Homemaker Centre in a deal valued $103.2 million.

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