Australian market at low level

Press, 3 August 1981, Page 20

Australian market at low level

Australia's sharemarkets drifted to their lowest level of the year, proving in the process a fertile soil for rumours but soft ground for new floats. The all-ordinaries index fell 7 points to 633.2 as B.H.P. — its weightiest stock

— suffered at the hands of investors who worried over the profit result and rumours of a S3OOM convertible note issue.

The directors scotched talk of a note issue. But the company, considered the market bellwether, finished the week 35c down at $13.15 as investors struggled with a host of conflicting influences. The company, which recently resumed its Bass Strait drilling programme, reported an unadjusted profit of $491.1M — an Australian record. However, the result was complicated by lack-lustre"

performances by the steel and minerals divisions, and there is concern about the group’s ability to repeat the profit performance next year.

BHP will put further pressure on the market later this month when investors pare their portfolios in order to meet a SI6SM call on the group's recent rights issue.

Rumours of a new oil find at the Yarrada No. 1 well in the Canning Basin set off a run on oil shares early in the week but Haoma Oil reported that, the well, 57km north-west of the Blina No. 1 strike, flowed only drilling Vamgas, with a 10 per cent interest in the permit, closed at $12.50', down 100 c frorrwts mid-week high, for a net gain of 10c. Petroleum Securities, with an equal share,. closed 20c up at 610 c, compared with a mid-week high of 700 c.

The listless market made for a less than exciting launch by Weeks Petroleum which was expected to be one of the glamour floats of the year. The company’s 50c shares had last business on Friday at 47c. The restructured Renison Goldfields Group ended its first week on the boards at 510 c.

The company is the result of a merger of Consolidated Gold Fields Australia, Ltd, Renison, Ltd, Mt Lyell Mining and Railway, Ltd, and Associated Minerals Consolidated, Ltd.

The merger marked the first time that four Australian public companies have merged simultaneously. CSR was among the big losers with a 12c fall to 548 c after its chairman (Sir Noel Foley) told shareholders that the group’s profit outlook was clouded by an uncertain trend in commodity prices. Harfiersley and Comalco provided proof of the uncertainty on Thursday by reporting sharply reduced interim profits. Hamersley’s result was down 84.2 per cent at $6.6M and Comalco’s fell 66 per cent to $12.5M.

Comalco fell 10c on the week to finish at 180 c and the rarely-traded Hamersley had last sales on Wednesday at 400 c compared with 390 c the week before.

In other trading, WMC was 25c down at 460 c, MIM was 5c off at 370 c, CRA put on 5c to 400 c, Pancontinental was up 30c at 600 c, Woodside firmed 2c to 168 c. the Bank of NSW rose a cent to 304 c, and the ANZ Bank was steady at 530 c.