Australia's S&P/ASX Index Declines, Led by BHP on Metals Prices

By Shani Raja

Aug. 5 (Bloomberg) -- Australia's benchmark S&P/ASX 200 Index fell, led by BHP Billiton Ltd. as metal prices tumbled and oil declined to a three-month low.

The index lost 67.30 points, or 1.4 percent, to 4,820.40 at the close of trading in Sydney, the lowest since July 15. The index rebounded from a 2 1/2 year low as Westpac Banking Corp. led a rally in lenders after Australia's central bank left its benchmark interest rate at a 12-year high and signaled it may cut borrowing costs as slowing economic growth cools inflation.

The benchmark's top 10 losers were all resources companies, while a measure of materials stocks on the index fell 6.5 percent, the worst performer among 10 industry groups.

``Commodities prices have hit a choking point,'' said Nader Naeimi, a Sydney-based senior investment strategist at AMP Capital investors, which manages about $108 billion. ``With further evidence of slowing growth there'll be ongoing pressure on mining and resources stocks.''

Global energy and raw-materials stocks fell into bear markets yesterday on plunging prices for commodities from oil and gold to copper and wheat, on concern global economic growth may slow, hurting demand.

BHP, the world's largest mining company, slumped 6.6 percent to A$35.82, the lowest since the end of March. Rio Tinto Group, the third biggest, fell 6.2 percent to A$110.79, the biggest drop in more than a month and lowest price since Jan. 24.

Perilya Ltd., a zinc producer, declined 10 percent, the lowest since 2003, while Minara Resources Ltd., Australia's second-largest nickel producer, dropped to its lowest in almost five years.

Woodside Petroleum Ltd., Australia's second-largest oil and gas producer, declined A$2.80, or 5.2 percent, to A$51.20, the biggest drop in almost two weeks, after crude oil fell in New York. Tropical Storm Edouard will miss most offshore oil facilities as it approaches the coast of Texas.

The following companies were among the biggest winners and losers on the Australian stock exchange.

ABC Learning Centres Ltd. (ABS AU), the world's biggest publicly traded owner of child-care centers, rose 2.5 cents, or 3.7 percent, to 71 cents, the most since July 28. The company said it finished restructuring its board, including the appointment of Paul Binstead, an ex-investment banker, and former Toll Holdings Ltd. director Frank Ford as non-executive directors from September.

Asciano Ltd. (AIO AU), the Australian port and rail operator, climbed 21 cents, or 4.4 percent, to A$5.04, the highest since February. Asciano may be worth 76 percent more than buyout firm TPG Capital's A$2.9 billion ($2.7 billion) hostile cash offer based on recent takeover offers, Citigroup Inc. said.

Axa Asia Pacific Holdings Ltd. (AXA AU), a unit of Europe's second-biggest insurer, rose 31 cents, or 7.2 percent, to A$4.60, the most since Feb. 19 and the benchmark's third-biggest gainer, after earnings excluding investments gained 11 percent on increased sales in Hong Kong.

Incitec Pivot Ltd. (IPL AU) slumped A$9.03, or 5.7 percent, to A$150.80, the biggest drop since July 24. Australia's largest fertilizer maker will ask shareholders to approve a 20-for-1 share split to deter hostile bids.

Indophil Resources NL (IRN AU) added 3 cents, or 1.9 percent, to A$1.34, the steepest advance since July 10. Stanhill Resources Pty, battling Xstrata Plc for control of Australian copper explorer Indophil, may raise its A$540 million ($502 million) offer, Stanhill said in a statement.

Seven Network Ltd. (SEV AU), the television broadcaster controlled by billionaire Kerry Stokes, gained 25 cents, or 3.1 percent, to A$8.39, the highest since June 11. Australia's most watched television broadcaster will buy back more than 19 percent of its stock in a move that may strengthen the control of billionaire Stokes.

To contact the reporter on this story: Shani Raja in Sydney at sraja4@bloomberg.net.