Sydney, Oct 29, 2008 AEST (ABN Newswire) - Overnight Wall Street amazingly rocketed nearly 11%, pushing the Dow to its second largest point gain in history amid hopes for a rate cut and easing of the global credit crunch.
This morning shortly after open the Australia market has joined the rally with S&P/ASX200 up 4.3%, or 162.7 points, to 3957.3 points. Yesterday Australian shares suffered their fifth consecutive day of losses, hitting fresh four-year lows, as falls by the big banks eclipsed gains by miners. At the close, the benchmark S&P/ASX200 share index was down 14.6 points, or 0.4%, to 3794.6, recovering from an earlier drop of as much as 2.2%. Analysts expected the next few weeks ahead a relief period.
In recent trading, the December Share Price Index futures contract on the Sydney Futures Exchange was up 242 points, or about 6.5%, at 4,044.
The Aussie dollar opened 4.2 per cent firmer today as a surge on Wall Street, in spite of gloomy US economic news, boosted the appetite for high interest rate currencies. At 7am AEDT, the dollar was trading at $US0.6420/24, up 2.57 US cents from yesterday's close of $US0.6163/66.
Oil prices dropped close to 17-month lows, erasing earlier gains despite a warning that the OPEC could slash output further in a bid to shore up the market. New York's main contract, light sweet crude for December delivery eased nine cents to $US63.13 a barrel today, after hitting $US61.30 yesterday.
Key Economic Facts and Figures
The National Australia Bank September quarter business survey shows business conditions fell 11 index points to minus four points in the September quarter. All components of the index were lower - trading conditions worsened, profits weakened and the measure of employment backpedalled - in one of the biggest quarterly falls in the past 20 years.
Prime Minister Kevin Rudd yesterday announced the government will give Australia's financial regulators an extra A$83 million over four years to help them deal with the global financial crisis. The move is aimed at fixing an unintended consequence of the government's guarantee scheme, which left some A$12 billion of investment funds frozen because they were not covered by the guarantee.
In economic news today, the Federal Department of Education, Employment and Workplace Relations will release skilled vacancies data for October.
M&A News
The British gas producer BG Group(LON:BG) has announced a 5.6 billion Australian dollar friendly takeover bid for Queensland Gas(ASX:QGC) in Australia. BG has acquired a near-10 percent stake in Queensland Gas in February. BG says the acquisition will enhance BG's global LNG position and establish a material business in Australia.
Marketing group Photon(ASX:PGA) is understood to be looking for a buyer for two-thirds of the company, after key shareholders ruled out selling their holdings. The company said while acquisitions were still on hold, group companies were continuing to expand into new markets.
Important Corporate News
Suncorp-Metway Ltd(ASX:SUN) says it is on track to achieve its fiscal 2009 guidance for its banking and insurance arms after making a strong start to the year. Suncorp is forecasting its banking profit before tax and bad debts to grow in the high single digits in fiscal 2009. But the company also warned that it could be forced to cut its dividend as a direct consequence of the global credit crisis.
Qantas(ASX:QAN) has agreed to a financial penalty of A$22 million to settle its liability resulting from price fixing conduct in its freight division. The competition watchdog ACCC has launched legal actions against Qantas and British Airways for alleged price fixing in the air freight market.
Australia's largest engineering company, WorleyParsons Ltd(ASX:WOR), expects a positive outlook and robust growth from its hydrocarbon business this fiscal year despite the global market crisis.
St George Bank(ASX:SGB) has reported an increase in annual profit and says the outlook for the economy remains uncertain. In its last earnings report before being taken over by Westpac Banking(ASX:WBC), St George said net profit for fiscal 2008 rose 0.9% to A$1.17 billion, from A$1.16 billion the year before.
1. Related Stocks - Mid Market (AEST 12:45)
------------------------------------------------------Code % Change Volume Turnover Low High------------------------------------------------------ASX:QGC +.17 112,404,163 $646,332,708 575 576ASX:PGA +3.33 22,000 $33,501 152 160ASX:SUN +3.46 6,261,502 $48,857,778 770 785ASX:QAN +2.89 4,194,038 $10,440,463 246 254ASX:WOR +7.22 1,573,207 $23,620,014 1476 1520ASX:SGB +3.09 676,887 $18,953,341 2747 2839ASX:WBC +2.78 3,419,430 $72,959,099 2097 2169
2. Top 10 ASX on Turnover - Mid Market (AEST 12:45)
------------------------------------------------------Code % Change Volume Turnover Low High------------------------------------------------------ASX:QGC 112,364,323 $646,103,595 575 576ASX:BHP +5.04 9,429,452 $249,920,435 2608 2695ASX:ANZ +4.54 4,919,000 $87,034,841 1746 1795ASX:CBA +3.7 2,040,023 $84,961,749 4050 4129ASX:NAB +4.62 3,452,647 $83,377,730 2361 2437ASX:RIO +5.49 992,124 $74,707,156 7051 7260ASX:WBC +2.73 3,368,107 $71,878,749 2097 2169ASX:TLS +2.53 16,008,940 $64,555,845 399 406ASX:WPL +6.54 1,429,953 $57,526,880 3750 4047ASX:WDC +.62 3,680,990 $54,820,651 1440 1511
Contact
Michelle Liang
Asia Business News Asia Bureau
Tel: +61-2-9247-4344
Email: michelle.Liang@abnnewswire.net
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