The Aussie sharemarket closed 1.35 per cent lower, after the Reserve Bank cut rates for the second consecutive month to 4.25 per cent. Industrials and materials were the heaviest sectors of the day.
The S&P/ASX 200 Index lost 64 points to finish at 4,257. On the futures market, the SPI is 51 points lower.
Economic news
As we know the RBA’s cut rates by 25 basis points to 4.25 per cent. Governor Glenn Stevens says the reduction’s a result of the Board’s previous decision that’s flowed through to lending rates, which are now around their average levels of the past 15 years.
"Short-term market interest rates have declined over recent weeks but term funding conditions for financial institutions have become more difficult," he says.
We also learnt today that Australia’s account deficit narrowed in the three months to the end of September, just slightly above expectations. The Bureau of Statistics says Australia booked an account deficit of $5.637 billion in the September quarter, seasonally adjusted. That’s compared with a deficit of $6.66 billion in the June quarter, downwardly revised.
Company news
The NSW Environment Protection Authority’s lifted the Prevention Notice on the ammonia storage system at Orica Limited's (ASX:ORI) Kooragang Island site at Newcastle. Orica says it’s demonstrated to authorities that it’s satisfactorily “addressed issues” caused on November 9 when the plant was shut down after a leak of ammonia vapour, and that it’s continuing with pre start-up testing of the ammonia plant. Shares in Orica Limited (ASX:ORI) closed 1.75 per cent lower at $25.85.
The Bank of Queensland Limited (ASX:BOQ) was the first bank to cut interest rates this afternoon after the RBA’s announcement.
It’s reducing the interest rate on its standard variable rate home loans by 25 basis points to 7.36 per cent. Chief executive Stuart Grimshaw says passing on the full cut is “the right thing to do by customers”. Shares in The Bank of Queensland Limited (ASX:BOQ) closed 0.13 per cent higher today $7.94.
Santos Limited’s (ASX:STO) delivered natural gas from the offshore Reindeer field in the Carnarvon Basin to the Dampier to Bunbury Natural Gas Pipeline for the first time. The gas is processed at Devil Creek, Western Australia’s third domestic gas processing plant.
Charter Hall Retail REIT (ASX:CQR) is set to acquire Lansell Plaza in Victoria from the Centro Retail Group (ASX:CER) for $32.5 million at an initial yield of 9 per cent. The sale’s expected to be settled by the end of next month.
BHP Billiton Limited (ASX:BHP) says average oil and natural gas production at its recently acquired Petrohawk Energy rose 46 per cent in the first nine months of the year, to 940 million cubic feet of natural gas equivalent a day.
And the compulsory land acquisition notices the West Australian government issued for Woodside Petroleum Limited (ASX:WPL) for its proposed Browse gas hub at James Price Point have been found unlawful by the WA Supreme Court. Justice Wayne Martin declared three of the notices invalid because they didn’t contain descriptions of the land required.
Best and worst performers
All sectors were in the red. With the smallest losses was Telcos, down three points to 1,097. The worst performing sector was industrials, down 99 points, closing at 3,443.
The best performing stock in the S&P/ASX200 was OM Holdings, it rose 12 per cent to close at 4.5 cents. Shares in Wotif and Charter Hall Office also finished stronger today.
The worst performing stock was Lynas, it dropped 7.35 per cent to 10 cents, followed by Oceanagold and Linc Energy.
IPOs
Precious Metals (ASX:PMR) debuted on the market today, listing at 20 cents, opening at 22 cents and closing at 23 cents.
Commodities
The price of gold is $US1,712 an ounce and Light crude is down 52 cents at $US100.47 a barrel.
