Despite mixed offshore leads the Australian share market rose at open, but backpedalled after the release of the Reserve Bank of Australia’s latest board meeting minutes to end 0.3 per cent down. The mining sector ended as the worst performer, with Rio Tinto Limited (ASX:RIO) falling after posting lower than expected production figures and rival mining heavyweight BHP Billiton Limited (ASX:BHP) also dropping ahead of its production report due tomorrow.
The S&P/ASX 200 index lost 14 points to finish at 4,289. On the futures market the SPI is currently 13 points lower.
Economic news
Australia’s central bank has hinted a rate cut might be round the corner. Minutes from the Reserve Bank of Australia’s (RBA) April board meeting have recognised global growth will dip below trend this year. The RBA will now await inflation figures before making a decision on rates decision ahead of its May board meeting next week.
Sales of new cars in Australia have increased to their highest level in almost two years. The Australian Bureau of Statistics has reported sales of new motor vehicles increased 4 per cent in March with more than 89,000 vehicles sold last month.
Residential prpoerty has slowed but modest improvements are expected within the next two years. The annual Australian Property Directions Survey has forecast demand for residential property in Sydney, Melbourne and Brisbane to slightly increase next year and move out of a downturn by 2014.
Company news
Rio Tinto Limited (ASX:RIO) is targeting to produce 250 million tonnes of iron ore this year after reporting first quarter output for its prime commodity rose 10 per cent to 59 million tonnes. The global miner describes its March quarter production results as solid, having achieving increased production of iron ore, coal bauxite, alumina and titanium dioxide. Rio says the improvement was due to high operating performance and reduced impact from severe weather. However, the results missed analyst forecasts with the miner shipping less than expected iron ore and posting greater than expected falls in copper production. Shares in Rio Tinto fell 0.75 per cent today, closing at $64.70.
Billabong International Limited (ASX:BBG) has completed the Nixon transaction that will see the surfwear retailer and Trilantic Capital Partners each own a 48.5 per cent stake in Nixon. Billabong announced the partial sale of its key asset in February, along with 150 store closures, 400 job cuts and a 72 per cent fall in its interim net profit. Shares in Billabong International dipped 0.35 per cent, closing at $2.88.
Shares in Rio Tinto Limited (ASX:RIO)-controlled Energy Resources of Australia Limited (ASX:ERA) jumped to today’s before performer after Bank of America- Merrill Lynch upgraded the stock to “buy” from “underperform,” claiming the “worst is behind” the uranium producer.
Shares in Iluka Resources Limited (ASX:ILU) closed lower, despite the mineral sands producer announcing it has discovered an additional heavy mineral at its Sonoran deposit in South Australia.
Engineering company Downer EDI Limited (ASX:DOW) has been awarded a $85 million contract to carry out electrical work on the new Victorian Comprehensive Cancer Centre in Melbourne.
National Australia Bank Limited (ASX:NAB) has confirmed it will maintain the lowest interest rates of the big four banks just one week after ANZ Banking Group (ASX:ANZ) hiked its rates independently of the RBA.
Best and worst performers
Most sectors lost value: The best performing sector was Health Care adding 45 points to close at 8,792. The worst performing sector was Materials, losing 80 points to close at 10,765 points.
The best performing stock in the S&PASX 200 was Energy Resources of Australia Limited (ASX:ERA), rising 12.73 per cent to close at $1.55. Shares in Lynas Corporation Limited (ASX:LYC) and Energy World Corporation Limited (ASX:EWC) also closed higher.
The worst performing stock was Linc Energy Limted (ASX:LNC), dropping 12.99 per cent to close at $1.105. Shares in Mirabela Nickel Limited (ASX:MBN) and Ramelius Resources Limited (ASX:RMS) also closed lower.
Commodities
Gold is trading at $US1,649 an ounce.
Light crude is $0.06 down at $US102.87 a barrel.
The Australian dollar
The Australian dollar is buying $US1.0322.
