core sector communique

West Australian stocks jump 7% in March

11^th April 2010

 

The market capitalisation of Western Australian listed companies which comprise the Deloitte WA Index continued their strong growth in March, closing at $170.3b, an increase of 7% for the month.

 

Managing Partner of Deloitte in Western Australia, Keith Jones, said the Deloitte WA index experienced a surge in value in March, following strong growth in February

 

“The strength of the Deloitte WA Index in March has again been underpinned by the mining sector, particularly iron ore, which correlates with a significant increase in commodity prices, driven by high levels of demand from China,” Mr Jones said. Woodside Petroleum Limited showed a significant increase for the month of $2.7b (8.1%), with strong growth also shown by Fortescue Metals Group Ltd and Wesfarmers Ltd of $776m (5.4%) and $663m (2.1%) respectively.

 

The ‘Movers and Shakers’ for March were iron ore focussed companies, Grange Resources Limited, Sphere Minerals Limited and Giralia Resources NL, with increases in market capitalisation of 58.3%, 41.6% and 40.9% respectively.

 

Grange Resources Limited increased market capitalisation by $241m, which continued a consistent growth in share prices. During March Acorn Capital purchased 50 million Grange shares from Stemcor Pellets Ltd, taking Acorn’s interest in Grange to 4.35%.

 

Sphere Minerals Limited released its December 2009 interim results during March reporting a strong balance sheet as it continues its magnetite-quartzite exploration. Sphere also issued 1.5 million employee share options during the month.

 

During March Giralia shareholders received their holding statements for the shares in Gascoyne Resources Limited, following the Company’s joint listing of Gascoyne with Helix Resources Ltd last year. Giralia shareholders had approved the in-specie distribution of 14.6m of its 18.2m Gascoyne shares to shareholders of Giralia in February.

 

All of the major world indices also increased during March. The Nikkei led the way with an increase of 9.5% for the month, followed by the FTSE 100, US S&P 500 and the Australian All Ordinaries with increases of 6.3%, 6.2% and 5.2% respectively.

 

The commodities market in March performed well, with gains made by all commodities surveyed aside from Lead and Gold which decreased by 1% and 0.39% respectively. Nickel was the stand out performer once again with another double digit increase of 18.32% to US$24,960 per tonne - the highest price for Nickel since May 2008. The increase is a result of improved economic growth in China driving up demand for steel and nickel. Palladium, Aluminium, Copper, Zinc, Tin and Platinum were also strong performers with increases of 11.05%, 9.11%, 8.27%, 7.95%, 7.83% and 6.58% respectively.