2:15AM New York, 4:15PM Sydney – Australian stocks fell on global weakness. Zinifex and Oxiana merger gets a court approval. Xstrata abandons Indophil bid.
Market Sentiments
ASX 200 index lost 1.5% or 78.3 to close at 5,288.30. The preliminary market turnover 1.98 billion shares worth $6.95 billion, with 518 stocks rising, 756 falling and 360 unchanged. Telstra led the most active stocks with a trading volume of 58.4 million shares worth $252.5 million.
Market Driver
The index weakened today after local investors sold oil company stocks after China announced it is lifting the price of petrol, diesel and jet fuel between 16% and 18%.
World''s leading oil companies are reported to be negotiating to re-enter Iraq after 40 years. Woodside''s share fell 3.9%, Santos Ltd shed 6.2% and Oil Search declined 2.7%.
Gainers and losers
Of the ASX 200 index stocks, FKP Property Group led the gainers with a rise of 31.6% followed by increases in Iluka Resources of 9.9%, in Babcock & Brown of 6.7%, in Flight Centre of 6.3% and in Alesco Corp Ltd of 6.3%.
Of the ASX 200 index stocks, APN/UKA European led the decliners with a fall of 24.6% followed by losses in Transurban Group of 14.6%, in Babcock & Brown of 13.9% and in Centro Retail Group of 8.9%.
Xstrata backs down on Indophil
Xstrata abandoned its offer for Indophil after a bid led by its chief executive offered 28% more.
The world''s fourth-largest copper producer Xstrata Queensland Limited a wholly owned subsidiary of Xstrata plc, today announced that it would review a bid by a consortium comprising Crosby Capital Limited, the Alsons Group and Mr Richard Laufmann, CEO and Managing Director of Indophil Resources NL to acquire 100% of Indophil for $1.28 cash per share.
Mr Laufmann''s group''s $540 million offer translates to $1.28 a share in cash and 28% more than the offer from Xstrata. Xstrata has declined to match the offer according to a statement filed with the ASIC.
Xstrata has a 2.2% stake in Indophil and its stock surged 20%.
Fortescue welcomes draft proposal to open rail access
Australia''s third-largest iron ore producer, Fortescue Metals Group Ltd today welcomed a draft recommendation by the National Competition Council to declare open to third party access the rail services of Rio Tinto and BHP Billiton for the Robe, Hamersley and Goldsworthy railway lines. Fortescue said in a statement, it recognizes the ultimate decision rests with Treasurer Wayne Swan to act on the recommendations.
Fortescue Executive Director Graeme Rowley said: ""It has now become abundantly clear that the railroads of the Pilbara have not just been used to develop an iron ore business for a favored few but as a prohibition on the further development of the Pilbara by anyone else.
The decision by the NCC recognizes the opportunity available now for all mining companies operating in the Pilbara to capture the enormous export demand from China and other Asian markets for all minerals including iron ore,"" he said.
Fortescue share shed 5.7%, BHP fell 0.8% and Rio Tinto was down 0.2%.
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