Australian shares have closed the session lower today with resource stocks like top miners BHP and Rio Tinto leading the declines. Investors concerned that company valuations have increased at a faster rate than can be justified by the pace of economic recovery.
The S&P/ASX 200 Index closed 36 points lower at 4,677 while on the futures market, the SPI200’s down 36.
To company news around this afternoon: Fashion retailer Myer Holdings Ltd has released its prospectus today with the company to list on the ASX on November 2. The company is to offer shares at between $3.90 and $4.90 a share, aimed at raising $2.34 billion ahead of its listing. Over the next few weeks Myer will market its float to retail investors, followed by an institutional bookbuild. According to The Australian the offer price values Myer at between 14.3 and 17.3 times estimated earnings for 2009/10, compared to David Jones Ltd (ASX:DJS) current multiple of 17.9 times earnings. However DJ’s CEO Mark McInnes told Sky TV he is looking forward to DJ’s main rival having to endure the same kind of scrutiny it does when Myer floats in November, saying that he hopes investors will see good value in his company’s shares compared to Myer. David Jones shares closed 1.78 per cent higher at $5.71.
Chairman of media company Fairfax Media Ltd (ASX:FXJ), Ron Walker has announced that he will not seek re-election at the company’s forthcoming annual general meeting. In a statement to the ASX Mr Walker says he had come to his decision in view of the unfortunate developments of the previous few weeks. Mr Walker’s announcement follows news that board member John B. Fairfax intended to vote against Mr Walker’s re-election to chairman, claiming significant shareholder dissatisfaction. Fairfax Media shares closed 1.48 per cent lower at $1.66.
Also making news: Australia and New Zealand Banking Group Ltd (ASX:ANZ) has announced the appointment of Philip Chronican as CEO Australia reporting to ANZ Chief Executive Officer Mike Smith. Mr Chronican will join ANZ in November 2009 and will be responsible for ANZ’s Australian geography with specific responsibility for the bank’s retail, commercial and wealth management businesses.
Iron ore producer Territory Resources Ltd (ASX:TTY) biggest shareholder Noble Resources has agreed to help the debt laden miner by repaying the debt owed by Territory to its financiers. The agreement is subject to the documentation and settlement of the transfer being completed by 5pm Perth time on September 29.
Manufacturer and supplier of agricultural chemicals Nufarm Ltd (ASX:NUF) has reported a 42.1 per cent fall in net profit to $79.9 million for the year to July 31. Nufarm also says it has entered into a heads of agreement with Sinochem in relation to a proposal for Sinochem to acquire all of the issued ordinary shares in Nufarm for $13 a share.
And Miner and metals traded OM Holdings Ltd (ASX:OMH) says it has secured a $294 million deal to acquire a major stake in a South African manganese project which it says will help the company transform into one of the world’s largest independent manganese companies.
In the best and worst performers: The best performing sector at close was the Real Estate Investment Trust index, up 10 points at 930 while the worst performing was the Materials index; which lost 216 points at 11,112.
The best performing stock in the S&P/ ASX200 was Nufarm shares jumped 7.36 per cent to $11.96 after China’s Sincohem agreed to acquire the company in a deal worth $2.8 billion. Shares in Infigen Energy and Commonwealth Property Office Fund shares also gained.
The worst performing stock was Gunns shares lost 9.81 per cent to $1.195. Shares in Karoon Gas Australia fell, the company saying its second exploration well off W.A. has been plugged and abandoned after disappointing drilling results. Aquila Resources also lost ground.
In commodities, gold is trading at $989.50 U.S an ounce and light crude is down 51 cents at $65.51 U.S a barrel.
