Australian Stock Market Report – Afternoon October 28, 2014
- Australian shares recovered this afternoon to make up for most of the earlier losses. The ASX 200 Index fell by 0.1 per cent following a 0.8 per cent improvement on Monday.
- Energy stocks fell most today with the price of oil hovering around its lowest level in two years. Woodside Petroleum (WPL) fell by 1.5 per cent today while Santos (STO) slipped by 0.9 per cent. South Australia based oil and gas company Beach Energy (BPT) slumped by 6.8 per cent after posting a 12 per cent slump in quarterly revenue. Mining services company WorleyParsons (WOR) fell by 2.6 per cent after flagging relatively flat earnings growth over FY15.
- Mining shares also underperformed with the price of iron ore easing by 0.3 per cent or $0.20 to US$79.6 per tonne. Junior miner BC Iron (BCI) fell by 13.9 per cent after cutting its sales forecast for the year. BCI shares have slumped by around 80 per cent this year. BHP Billiton (BHP) fell by 1.4 per cent while the smaller Rio Tinto (RIO) shed 1.3 per cent. This morning Cliffs Natural Resources posted a Q3 net loss of US$5.9bn due to hefty US$5.7bn write-downs. Cliffs is America's biggest iron ore miner (still is around six times smaller than Australia's Forstescue).
- Tabcorp Holdings (TAH) rose by 1 per cent after posting a 6.6 per cent jump in Q1 revenue to $537.4. TAH estimates that as much as 14% of betting by customers based in Australia are done through businesses not based or licensed in Australia.
- Qantas (QAN) surged by 7.3 per cent following a 5 per cent rise yesterday thanks to a broker upgrade. Last week Australia's flagship airlines said it's on track to return to profitability together with strong September passenger numbers. QAN shares are trading at their highest level since June 2013.
- Volume was average today with 1.94bn shares traded worth $4.4bn. 401 stocks finished higher, 532 in the red and 371 were unchanged.
- The Australian dollar buys US$0.881, €0.693 and £0.546.
- Asian markets were mixed today with shares in China, Hong Kong and New Zealand improving while shares in Japan and South Korea lost some ground.
- Tonight consumer confidence, durable goods and home price data will be issued in the US. The highlight however over the next few days will be the two day meeting of the US central bank. The FOMC is widely expected to announce the end of its stimulus program and commentary relating to monetary policy is the main risk for currencies this year.
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