The Australian share market finished flat after a low key trading day, with global markets seeing soft trade ahead of Ben Bernanke’s congressional appearance and monetary stimulus announcement tonight. Among the stocks, BHP saw some gains despite missing full year production guidance, while Billabong was traded emphatically after being thrown a much needed lifeline.
The S&P/ASX 200 index closed 4 points down to finish at 4,982. The value of trades was $3.7 billion on volume of 785 million shares at the close of trade. The top three stocks by value were BHP Billiton Limited
(ASX:BHP), Rio Tinto Limited
(ASX:RIO) and Insurance Australia Group Limited
(ASX:IAG).
On the futures market the SPI is 7 points down.
Economic news
The Westpac Melbourne Institute leading index, which indicates the likely pace of economic activity three to nine months into the future, remained well above trend in May, coming in at 4.9 per cent, above its long-term trend of three per cent.
Company news
Woolworths Limited
(ASX:WOW) Woolworths has been forced to retract a claim made in a car insurance advertisement after the corporate watchdog deemed it misleading. The Australian Securities and Investments Commission believes the online and outdoor campaign from late last year and early this year, made misleading claims about the cost of insurance. Shares in Woolworths closed steady at $33.69.
Billabong International Limited
(ASX:BBG) rode a wave of investor enthusiasm today, soaring 34 per cent with more than 83 million shares being traded on the news Altamont Capital Partners will buy out the company’s debt. A condition of the deal will see CEO Launa Inman leave the company, to be replaced Scott Olivet, the former chief of sunglass and sportswear giant, Oakley. Shares in Billabong closed 34 per cent up at $0.34.
Wesfarmers Limited
(ASX:WES) total coal production has risen for the full year, as the miner recovers from the ongoing impact of Cyclone Oswald.
Iluka Resources Limited
(ASX:ILU) shares gained 4.7 per cent despite mineral sands production falling in the June quarter amid lower demand.
Insurance Australia Group Limited
(ASX:IAG) firmed by 1.71 per cent after lifting its full year guidance on insurance margins, after paying out less than expected for natural disasters.
BHP Billiton Limited
(ASX:BHP) shares rose 2.27 per cent despite the global miner missing its full-year iron ore production guidance even though it posted a strong lift in fourth-quarter activities.
Best and worst performers
The best performing sector was Materials adding 157 points to close at 9,213.
The worst performing sector was Utilities, losing 55 points to close at 5,485.
The best performing stock in the S&PASX 200 was Billabong International Limited
(ASX:BBG), rising 34 per cent to close at $0.34. Shares in Ausdrill Limited
(ASX:ASL) and Boart Longyear Limited
(ASX:BLY) also closed higher.
The worst performing stock was Lynas Corporation Limited
(ASX:LYC), dropping 6.90 per cent to close at $0.41. Shares in Perseus Mining Limited
(ASX:PRU) and M2 Telecommunications Group Limited
(ASX:MTU) also closed lower.
Commodities
Gold is trading at $US1,287 an ounce after tipping a three week high ahead of Bernanke’s next monetary stimulus maneuver. Light crude is $0.59 down at $US105.41 a barrel.
The Australian dollar
The Australian dollar is buying $US0.9224.
