Fortescue shares up on increased Chinese sales

SHARES in Fortescue Metals Group jumped more than 15 per cent at market open after the iron ore miner announced an increase in exports.

In morning trading, Fortescue shares had gained 20.5c, or 15.5 per cent, to $1.49 in an Australian market that was down 3.34 per cent in the first 15 minutes of trading.

The Australian market followed the lead from Wall Street overnight, which plunged further after lawmakers failed to pass legislation to extend emergency loans to US auto makers and jobless claims reached a 16-year high

Commodities also continued to slump, with prices of aluminium and copper sinking to their lowest levels in more than three years and oil tumbled below $US50 to its lowest level in more than three years.

But Fortescue¡¯s announcement of increased iron ore sales to China saw its stock jump today, going against the industry trend.

This would increase its contract by 3.5 million tonnes to 5.5 million tonnes.

The company was one of China's top five steel mills and that the increase was at the same contract price.

The company also announced that it had taken advantage of current bond market weakness to purchase debt notes that the company issued in August 2006 with a face value of $US65million at a net price of $US45million, a 68 per cent discount to the original value.

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