core sector communique

Deloitte WA Index marks 5th consecutive month of growth

Western Australian companies continued their strong share price rebound in June, driving a 5.9% rise in the Deloitte WA Index for the month of June.

The June result continues the strong gains in the Index since February, including five consecutive months of growth to date in the market capitalisation of WA’s top 100 ASX-listed companies. 

Deloitte Perth Managing Partner Keith Jones said the Index had risen $6.7bn in June.

 “This means the WA Index has climbed from a low of $72.4bn in November 2008, to $118.6bn at 30 June 2009 – a rise of $46.2bn or about 64%,” Mr Jones said.

“The growth in the WA Index for June has again been primarily driven by the rebound in the mining sector, which increased by $4.6bn for the month. Wesfarmers was also a strong contributor increasing by $1.3bn,” said Mr Jones.

Movers and shakers for the month included Red Fork Energy Ltd, Fortescue Metals Group Ltd and Mantra Resources Limited with the market capitalisation of each company increasing by 76.2%, 44.7% and 41.5% respectively. Red Fork Energy Ltd increase following completion of multiple intervals within existing oil wells at their East Oklahoma project, while the market capitalisation of Mantra Resources increased following the announcement that the Scoping Study for the Company’s wholly owned Nyota prospect in Tanzania. 

Fortescue Metals Group Ltd increased its market capitalisation in June by $3.6bn. This followed the announcement by BC Iron Limited of an agreement with Fortescue to establish a Joint Venture to develop BC Iron’s Nullagine iron-ore project in WA. Fortescue also announced in June that they had signed a Cooperation Agreement with Aquila Resources to investigate the potential for a shared development of port facilities at Anketell Point.

The major world share indices performed well in June, with the exception of the FTSE 100 which experienced a decline of 3.4% for the month. The Nikkei experienced the largest gain of 4.6%, followed by the Australia All Ordinaries and US S&P, with increases of 3.5% and 2.2%, respectively. 

The commodities market in June had mixed results, with large gains made by aluminium, nickel, uranium and lead, up 13.5%, 10.2%, 7.8% and 7.4% respectively. Prices for silver and gold suffered large declines of 13.6% and 5.4% respectively.