Sydney, Nov 13, 2008 AEST (ABN Newswire) - Overnight US stocks sank for the third day after the United States backed away from using its $US700 billion bailout to buy banks' sour mortgages. The Nasdaq Composite fell to its lowest level in more than five years.
Yesterday, the Australian share market closed in the red for a second consecutive day with the broader All Ordinaries index ending 38.2 points lower, or 1%, at 3,883.6. The benchmark S&P/ASX200 share index yesterday lost 33.6 points, or 0.9%, to close at 3927.3. The industrial, materials, energy and consumer discretionary sectors sent the market lower.
The share price index futures market was recently more than 4% lower, or 185 points, to 3801 points.
The Australian dollar has opened lower as softer commodity prices and another poor day on Wall Street hurt the high-yielding currency. At 0700 AEDT, the Australian dollar was trading at $US0.6406/11, down 1.9 US cents, or 2.9 per cent, from yesterday's close of $US0.6599/05.
Oil prices sank Wednesday to the lowest levels since the start of 2007, as traders worried about weaker demand for energy amid a gloomy economic outlook. On the New York Mercantile Exchange, light sweet crude for December slid to 57.70 dollars. It later stood at 58.12 dollars a barrel, up 1.18 dollars.
Key Economic Facts and Figures
The Westpac-Melbourne Institute survey released yesterday shows Index of Consumer Sentiment rose 4.3 per cent to 85.5 in November after falling 11 per cent to 82 in October. It is suggested that rate cuts and more help for first-home buyers boosted consumer confidence this month although most people remained pessimistic. Analysts expect an aggressive rate cut by RBA in the coming months to help ward off a looming recession.
The Australian Bureau of Statistics released Australia's wage price index data for the third quarter on Wednesday. The index of hourly pay rates excluding bonuses rose by 0.8 per cent in the September quarter, the ABS said. It was lower than the 1.0 per cent rise economists had expected, and the smallest quarterly move for two years.
Today, the Australian Bureau of Statistics releases average weekly earnings data for the August quarter, while Westpac and the Melbourne Institute release their Index of Consumer Inflation Expectations and Consumer Unemployment Expectations for November.
M&A News
Australia's housing developer Stockland(ASX:SGP) has bought a 12.7 percent stake in GPT Group(ASX:GPT) for A$544 million, giving Stockland the right to be involved in any decisions made if GPT is broken-up. Stockland will exchange cash and securities to acquire the majority of the GPT holdings managed by Perennial Investments and also has an equity swap deal with Deutsche Bank.
OZ Minerals Ltd(ASX:OZL) has lifted its stake in Toro Energy Ltd(ASX:TOE) to 51.71 per cent from 46 per cent, after taking up its full entitlement under the uranium explorer's $A26 million renounceable rights issue.
Indophil Resources(ASX:IRN) shareholders have voted overwhelmingly to sell the junior's only major asset -- a stake in the massive Tampakan copper and gold deposit in The Philippines. Indophil is to start discussions with Filipino group Alsons, which has a non-binding agreement to buy the stake for about A$500 million.
Important Corporate News
Qantas(ASX:QAN) is reducing services across its New Zealand domestic network. It is reported Qantas will cut its 114 domestic flights a week in this country by 29, or 25.4 per cent, to 85 by the end of January.
Builder and developer Lend Lease Corporation Ltd(ASX:LLC) confirmed that full-year operating profit will decline between 10 per cent and 15 per cent in fiscal 2009. Profit will decline to as low as A$380 million in the 2009 financial year, from A$447.1 million in the 12 months to June 2008.
Tutt Bryant Group(ASX:TBG) has forecast a drop in profit this financial year because of the global financial crisis, after delivering a rise in earnings during the first half. The company posted a 13.1 per cent increase in net profit to A$13.8 million in the six months to September 30 after strong performance across its divisions.
1. Related Stocks - Mid Market (AEST 1230)
----------------------------------------------------Code % Change Volume Turnover Low High----------------------------------------------------ASX:TOE -11.53 119,052 $14,379 11.5 13ASX:SGP -10.48 3,275,077 $12,941,299 384 405ASX:OZL -4.06 4,033,675 $3,791,881 92 95.5ASX:IRN -5.06 396,633 $293,891 71.5 75ASX:QAN -6.13 4,966,023 $12,284,058 243 253ASX:LLC -9.87 782,075 $5,413,222 666 710ASX:GPT -9.24 18,869,048 $21,091,690 107 115.5
Contact
Michelle Liang
Asia Business News Asia Bureau
Tel: +61-2-9247-4344
Email: michelle.Liang@abnnewswire.net
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