The ASX was down 43.7pts, or 0.77 per cent, at 5615.5pts on Tuesday. Australian shares fell sharply in the opening hour of trading on Tuesday. The RBA Minutes of the latest monetary policy meeting reveiled that the Reserve Bank would consider cutting interest rates further if necessary. The local sharemarket recovered partially following the announcement, however the rally was short-lived and stocks fell back into negative territory thereafter. Almost all sectors declined with Energy performing the worst. The only positive sector on Tuesday was the Health Care sector, which rose 0.34 per cent. After the Minutes, the Australian dollar fell to a weekly low, falling below the US$0.80 mark. The AUD is trading around US$0.7995 around 4:07pm AEST.
International markets were mostly up in the previous day of trading. In the US, the Dow Jones was up 0.14 per cent and the S&P 500 was up 0.30 per cent. European markets have recovered from the bond market volatility from the previous weeks. The DAX was up 1.29 per cent and the FTSE 100 was up 0.12 per cent. Asian markets are up across the board. The Nikkei 225 is up 0.90 per cent near the end of trading on Tuesday, breaking past the 20,000-point mark. The Hang Seng has advanced 0.42 per cent while the Shanghai Composite has jumped 2.72 per cent so far on Tuesday.
South32 Limited (ASX:S32) was up 28c, or 13.66 per cent, at $2.33 per share. Australia’s newest and fourth largest mining company recently demerged from BHP. In its debut on the ASX on Monday, shares of South32 fell 3.8 per cent. In its second day of trading, S32 has performed well and has reached a market capitalisation of about $11bn.
Orica Limited (ASX:ORI) was down 21c, or 0.99 per cent, at $20.95 per share. Orica has appointed Alberto Calderon as its new Chief Executive Officer after the sudden departure of the former CEO Ian Smith.
Ruralco Holdings Limited (ASX:RHL) was up 30c, or 8.57 per cent, at $3.80 per share. Agriculture business Ruralco announced it had more than doubled its half-year profits. The company cited growth in its live export, water services and rural supplies operations.
Fortescue Metals Group (ASX:FMG) was down 7c, or 3.06 per cent, at $2.22 per share. The embattled mining company has taken some recent criticism in the iron ore dispute. The Minerals Council of Australia claimed that although BHP and Rio had slowed iron ore production, Fortescue had not.
Author: Simon Herrmann
May 19, 2015
Simon is a financial analyst at independent research firm Wise-owl specialised in small-mid cap growth opportunities and ethical investment opportunities. Simon's aim is to disrupt the cliché approach to investment decision making as he believes that socially and environmentally responsible behaviour is a necessity to long-term wealth creation. Simon has a deep fundamental understanding of the global financial landscape and has compiled 300+ research reports, valuations and corporate appraisals. Simon is commonly featured in major media outlets and his research is published weekly in The Australian.