ABN Newswire – US stocks surged for the third consecutive session overnight, as investors flowed into the financial sector due to the upbeat comments from Bank of America’s chief executive. General Motors also delivered good news to the market that it will not need $US2 billion loans it had requested from the US government to fund its operations in March.
Yesterday, the Australian market ended marginally lower as investors were encouraged by the Wall Street rallies. The benchmark S&P/ASX200 index ended the day down 0.3%, or 8.9 points, at 3235.5. The broader All Ordinaries index was also down 0.3%, or 8.7 points, at 3190.4. “Many investors have feared worst, and many are probably predicting companies such as GM would eventually be gone, and are already prepared for it,” says Thomas Su, Research Director of Money Cat Consulting. It may be too early to predict, but it seems the financial stocks may start leading the gain in the second half of the year, Thomas Su added.
Key Economic Facts and Figures
Australian Bureau of Statistics figures released yesterday showed the unemployment rate in Australia soared to 5.2% in February, its highest level in nearly four years. Economists anticipate the government will revise its previous unemployment forecasts at 5.5% by June and 7.0% in mid 2010. It is estimated that the unemployment rate will burst through 7% following the latest jobless numbers.
The government is resisting requests to extend its increase in the first-home buyer’s grant, raising fears of a housing slump once the scheme is terminated on June 30.
Uranium Equities Ltd (ASX:UEQ) has secured funding to explore the Headwaters project in West Arnhem Land, as the Brazilian mining giant Companhia Vale de Rio Doce (NYSE:RIO) has agreed to acquire up to 80% of the project.
Important Corporate News
Nickel producer Western Areas (ASX:WSA) has signed a seven-year offtake agreement with BHP Billiton (ASX:BHP). BHP will also put up A million to help fund development of Western Areas’ Spotted Quoll mine and expand its concentrator capacity.
Telstra (ASX:TLS) announced today the telco’s strategic marketing chief Bill Stewart has resigned to return to his home and family in the US. Mr Stewart will be replaced by current group managing director of wholesale, Kate McKenzie, on March 30.
Coal seam gas company Eastern Star Gas (ASX:ESG) has raised A million through a share placement to fund a reserve upgrade program.
IBA Health Group (ASX:IBA) announced the successful completion of the institutional component of its accelerated non-renounceable pro-rata entitlement offer (“Entitlement Offer”), raising approximately A million.
National Australia Bank (ASX:NAB) said the bank would slash its half-year dividend and refocus group strategy on its Australian financial services businesses.
Agribusiness AWB (ASX:AWB) said demand for Australian wheat remains strong ahead of a traditional period of volatility for the international market.
Virgin Blue (ASX:VBA) today said it had no reason to believe full-year operating profit would vary by more than 15 per cent from its guidance.
Investment firm Babcock & Brown (ASX:BNB) has been placed into voluntary administration after the rejection of a proposed debt restructure.