Jul 06 2010

Ten Tips for Painless Living

By sdposter and has no comments yet.

1. When sitting, walking and standing, keep your shoulders relaxed and your head level. Standing with your knees slightly bent will improve your posture and help prevent back pain.



2. Don’t stay seated for too long. Every 30 minutes, stand up, stretch, and walk around.


3. Take care with lifting – it’s the cause of many back injuries. Hold the load close to your body, feet shoulder-width apart. Bend your knees, not your back and lift with ‘leg power’. Don’t lift heavy loads higher than your waist. Avoid twisting – turn by moving your feet, not your back.


4. Your mattress and pillow should be firm enough to support your natural shape.


5. Good support from your car seat will prevent back and neck pain, especially if you spend alot of time driving.


6. Some office tasks require continuous repetitive movements that can cause muscle fatigue, so plan your day’s work to provide frequent *changes* of activity. Regular neck, shoulder and arm stretches will also help.


7. Baby slings help prevent back pain. Slings relieve tension in the arm muscles and allow you to take the load of your baby’s weight.


8. Kneel when gardening at ground level, rather than bending from the waist. Keep one hand on the ground for support as you lean forward. If your garden bed is wide, don’t lean in from the edge. Use a plank of wood to kneel or stand on.


9. Always warm up before you excercise. You will reduce the risk of injury and improve your performance. After excercise, drink plenty of water and keep moving while you cool down. This will help prevent stiffness and soreness.


10. Sprains and strains heal much faster if you use the R.I.C.E. technique in the first 24 to 72 hours after injury – Rest, Ice, Compression and Elevation. See a physiotherapist if pain and swelling persists.

Categories: health
Apr 06 2010

Australian Market – Tuesday, April 6

By SD

Tuesday, April 6 – Australian shares touched an 18-month high amid signs the US economy remains on the mend and as takeover
moves in the local coal and gold sectors complemented stronger commodity prices. The RBA’s decision to raise the official
cash rate by 25 basis points to 4.25% had little immediate impact, with the market having expected at least one hike in April
and May.


The All Ordinaries rose 48.2 points (0.98%) to 4,974.1 while the S&P/ASX 200 firmed 46.0 points (0.94%) to 4,953.7.

BHP Billiton (BHP) and Rio Tinto (RIO)

The ACCC has again pushed back the date for its ruling on the iron ore joint venture between BHP and Rio as it waits on more
information from the miners. It now expects to announce its findings by May 27. Regulatory approval by the European Commission
had been seen as the biggest barrier to the joint venture, but the ACCC has taken a tougher line than expected in its statements
to date indicating it plans a thorough study of the deal.

In unrelated news, South Africa’s state power company Eskom Holdings said BHP will renegotiate long-running power supply agreements
for its aluminium smelters in South Africa and Mozambique so that they will no longer be linked to commodity pricing and foreign
currency. Eskom said it expects to sign final agreements by the third quarter for the supply of electricity to BHP’s Hillside
and Bayside smelters in South Africa and its Mozal smelter in neighboring Mozambique. BHP, whose smelters are among the single
largest consumers of electricity in South Africa, said it would maintain a 10% reduction in power use in the country but cautioned
the national grid would remain under pressure for the foreseeable future. BHP advanced 68 cents (1.55%) to $44.63. RIO rose
$1.04 (1.31%) to $80.64.

Commonwealth Bank of Australia (CBA)

CBA raised a total of C$500m from an issue of 10-year bonds and an offering of three-year floating-rate notes, according to
sources. It raised C$400m from the 10-year bond issue, pricing the offering at 154 basis points over the relevant benchmark
for a yield of 5.19%. The bonds carry a coupon of 5.15%. The minimum target to be raised from this offering was C$300m. The
C$100m, three-year offering was priced at 60 basis points over the Canadian Dealer Offered Rate. CBA rose 45 cents (0.79%)
to $57.24.

National Australia Bank (NAB)

NAB guaranteed it wouldn’t raise its standard mortgage rate by more than any interest rate rise from the RBA. The RBA has
subsequently imposed a 25 basis point cash rate rise.

In other news, a bidding competition is developing for the purchase of 318 branches in the UK held for sale by the 84% state-owned
RBS, with contenders including Banco Santander SA, and Richard Branson’s privately held Virgin Money. NAB will bid at Tuesday’s
first-round deadline, according to sources. It isn’t clear however whether it will be alone or organise a tie-up with private
equity firms. NAB increased 29 cents (1.05%) to $27.94.

ANZ (ANZ)

ANZ said it will open an operations hub in Manila. The new centre which will be located in Makati City will open in July and
employ around 300 staff by the end of the year. It will add further back office capability to ANZ’s four existing hubs in
Melbourne, Bangalore, Wellington and Fiji and its two back office centres in Singapore and Hong Kong. ANZ firmed 16 cents
(0.63%) to $25.45.

AMP (AMP)

Sources familiar with the matter have suggested AMP will likely exit the battle to take over AXA Asia Pacific if NAB’s $13.29bn
rival bid is cleared by the ACCC. AMP is reluctant to enter a bidding war with NAB, whose proposal has the backing of the
target’s independent directors and majority owner France’s AXA SA. AMP firmed 4 cents (0.64%) to $6.30.

Leighton Holdings (LEI)

Leighton Holdings subsidiary Thiess Services said it signed a new contract worth up to $325m with Western Power for the provision
of electrical services. The agreement comprised an initial two-year contract, with the potential for three one-year extensions.
Thiess would work with Western Power to upgrade and maintain the electrical distribution network in metropolitan Perth and
the south-west of Western Australia. LEI weakened 23 cents (0.59%) to $38.90.

GPT (GPT)

GPT said it purchased a 50% stake in a Sydney office block development for $333m from Grocon Developments. GPT Wholesale Office
Fund pre-purchased the property at 163 Castlereagh Street in Sydney’s CBD. The building is due for completion in 2013. Grocon
and La Salle Investment Management each have a 25% stake in the development. When completed, the 42 storey tower will be one
of only 10 premium-grade office buildings in Sydney. GPT added 1 cent (0.85%) to $0.59.

Lend Lease (LLC)

Lend Lease said it will set up a 50/50 joint venture with London Continental Railways as part of a deal for the regeneration
of land holdings at Stratford City in east London. Lend Lease said in a statement it expects the joint venture and other agreements
to be signed over coming weeks. The London Continental Railways landholdings are next to the Athletes Village site for the
2012 London Olympic Games, where Lend Lease is providing development, project and construction management services. LLC fell
1 cent (0.12%) to $8.67.

Alumina (AWC)

Alumina said it has repurchased and cancelled US$50m of its convertible bonds with a maturity date of May 2013. The miner
said it now has US$300m worth of convertible bonds outstanding and that bond holders have the right to require the company
to redeem some or all of these on May 16, 2011 at 100% of their principal amount together with accrued and unpaid interest.
AWC improved 7 cents (3.97%) to $1.84.

CSR (CSR)

A newspaper reported CSR has had expressions of interest from international parties interested in its sugar and renewable
energy businesses and has decided to open its books to Bright Food Company after it boosted its offer for the businesses to
$1.75bn. A handful of international players had expressed interest in the businesses after Bright Food upped its bid for the
sugar and renewables segments. Senior representatives from Bright Foods including vice-chairman Ge Junjie will fly to Sydney
for formal discussions with CSR and other stakeholders, the paper reported. CSR fell 1 cent (0.28%) to $1.75.

Macarthur Coal (MCC) and Gloucester Coal (GCL)

Peabody Energy said it is raising its takeover offer for Macarthur Coal to $3.56bn from $3.3bn. Peabody is now offering $14
cash per share, up from the initial offer of $13 a share. The revised offer represents a premium of 22% to the 30-day average
price of Macarthur’s shares ahead of the announcement of Peabody’s initial offer. Peabody said it continues to offer Macarthur’s
top three shareholders, Citic, ArcelorMittal, and Posco the opportunity of retaining their stakes in a privatised Macarthur,
as its offer is no longer conditional on receiving their commitment to the deal, provided the Macarthur board supports the
bid. Macarthur plans a shareholder vote on its own proposed takeover of Gloucester on April 12 but Peabody called on the miner
to delay the vote to allow shareholders to consider the revised takeover offer.

Meanwhile, Noble Group announced an all cash offer for the remaining shares of Gloucester Coal it doesn’t already own. Noble,
which currently owns an 87.7% stake in Gloucester, said that the offer is conditional on Macarthur Coal’s takeover bid for
Gloucester not proceeding. The offer represents a 35.3% premium to the closing price of Gloucester on April 1. GCL is in a
trading halt and was last quoted at $9.31. MCC added 23 cents (1.55%) to $15.10.

Economic News

RBA continues ‘normalisation’, raising rates

The RBA raised its cash rate target a further 25 basis points to 4.25%. The fifth rise since October 2009, the gap between
relative interest rates between Australia and other industrialised countries has widened further in 2010 as the economies
of Europe and the US remain as yet subdued. With a surge in revenue now about to wash into the economy on the back of sharply
higher coal and iron ore export prices, the hike has brought rates back into what is a normal range just as economic growth
strengthens according to the RBA. “The Board judges that with growth likely to be around trend and inflation close to target
over the coming year, it is appropriate for interest rates to be closer to average,” RBA Governor Glenn Stevens said.

ANZ Job Ads Survey Rises in March

The total number of job ads in Australian newspapers and on the internet rose 1.8% in seasonally adjusted terms in March compared
with the previous month to an average of 162,692 ads per week, contributing to an 8% annual increase, ANZ said. Internet job
ads rose 2% in March from February, contributing to an annual increase of 7.3% in seasonally adjusted terms. Job ads in newspapers
in Australia fell 1% in March from February, weighing against a 20.1% annual increase in seasonally adjusted terms. These
were coupled with an unemployment rate of 5.3% in Australia and a 19.1% jump in job ads in February.

The NZSX50 added 32.68 points (1.00%) to 3,308.91 while the Nikkei fell 56.98 points (0.50%) to 11,282.32 and the Hang Seng
strengthened 297.65 points (1.40%) to be last quoted at 21,537.00.


Categories: trading
tags: ,
Mar 30 2010

Australian Market – Thursday, April 1

By SD

Thursday, April 1 – The Australian share market was well supported as the materials sector outperformed after Newcrest Mining
launched a takeover bid for Lihir Gold. The energy sector also outperformed before the Easter long weekend, although financial,
industrials, health care, consumer and property stocks fell on US peer weakness.


The All Ordinaries rose 32.8 points (0.67%) to 4,925.9 while the S&P/ASX 200 firmed 32.2 points (0.66%) to 4,907.7.

BHP Billiton (BHP)

BHP has agreed to sell part of a Maruwai coal project to Indonesia’s second largest thermal coal producer, PT Adaro Energy,
forming a joint venture. An Adaro subsidiary will purchase a 25% stake, which covers seven contract areas in East and Central
Kalimantan provinces, where undeveloped metallurgical and thermal coal resources are estimated at 774m metric tonnes. The
agreement still needs approval by the Indonesian government. BHP previously considered an outright sale. The project is still
in an exploratory phase and undergoing a feasibility study to determine when production can begin. Adaro plans to mine around
45m tonnes of low-sulfur thermal coal in 2010 versus 41m tonnes in 2009, and to export 70%-75% of production in both years.
BHP advanced 36 cents (0.83%) to $43.95.

ANZ Group (ANZ)

ANZ said it plans to increase its shareholding in two of its businesses in South East Asia as it looks to simplify its footprint
in Indonesia and Laos. ANZ said it is in advanced talks to buy a further 14% stake in PT ANZ Panin Bank, its Indonesian joint
venture with PT Panin Bank Tbk, which would take its stake to 99%. The additional stake is worth US$44m, and is subject to
regulatory approval. In Laos, ANZ has agreed to buy the remaining 10% of ANZ Vientiane Commercial Bank from International
Finance Corp, a member of the World Bank Group, for US$2.5m, taking its stake to 100%. ANZ weakened 7 cents (0.28%) to $25.29.

Rio Tinto (RIO)

Rio announced an investment agreement for a $4bn Mongolian Oyu Tolgoi copper-gold mine has become binding and the project
will now move into development. In the agreement, the Mongolian government will own 34% of the Oyu Tolgoi LLC. The project
is being developed by the mine’s 66% Canadian owner Ivanhoe Mines, and Rio Tinto which in turn holds a 22.4% stake in Ivanhoe,
will help develop the project.

Rio said the cost to build and commission the mining complex is expected to be about $4bn, though the final projections are
yet to be confirmed. A decision to build a coal-fired power plant for Oyu Tolgoi would require additional capital commitments,
Rio said. The mine is located in the South Gobi Desert just north of the Chinese-Mongolian border, and is expected to produce
450,000 metric tonnes of copper, about 3% of global supply, and 330,000 troy ounces of gold, with a mine life of 45 years.
Production is expected to start in 2013 and take five years to reach full output.

In unrelated news, Rio announced that it received a binding offer from Sun European Partners to acquire the Alcan Beauty Packaging
business. The terms of the offer are confidential. A period of exclusivity with Sun European Partners has been agreed and
Rio Tinto will respond to this binding offer following consultation with the relevant European works councils. RIO rose $1.20
(1.53%) to $79.60.

Lihir Gold (LGL) and Newcrest Mining (NCM)

Lihir rejected a $9.2bn takeover offer from Newcrest Mining, saying it didn’t reflect the value of the company’s assets or
offer a sufficient control premium. The offer was received March 29 and suggested one Newcrest share for every nine Lihir
shares plus 22.5 cents per Lihir share, less any interim dividend declared for the first half of 2010. Lihir Chairman Ross
Garnaut said there was strategic merit in a combination with Newcrest, which would provide geographical diversification and
lower the combined entities’ cost of capital, but that the shares-and-cash offer made by Newcrest was too low. In return for
being granted access to carry out limited due diligence, Newcrest has signed a standstill agreement that would preclude them
from making a hostile offer for Lihir for nine months but would not prevent them coming back with a higher friendly offer.
LGL rose $1.01 (33.33%) to $4.04. NCM increased 96 cents (2.93%) to $33.78.

Qantas (QAN)

Qantas is investigating an incident in which an Airbus A380 damaged tires on landing in Sydney, showering sparks and scaring
passengers late Wednesday. Video footage showed bright flashes from under the plane. None of the 244 passengers were hurt
in the incident, which comes just a day after a Boeing 747 was forced to abort a flight from Sydney to Singapore. QAN remained
unchanged at $2.84.

Macarthur Coal (MCC) and Gloucester Coal (GCL)

Macarthur rejected a US$3bn takeover approach from Peabody Energy. Macarthur said it plans instead to continue with its proposed
takeover of Gloucester Coal. Analysts have suggested the Peabody bid could be an opening gambit aimed at preventing the Gloucester
deal in advance of a sweetened bid later on. Macarthur in turn believes there are benefits in its planned takeover of Gloucester,
which would see it assume 100% ownership of the Middlemount mine by purchasing the stake of Gloucester’s majority owner, Noble
Group. Noble said it will continue with a meeting around April 19 to seek shareholder approval for the Gloucester deal. Macarthur
in turn said it will proceed with a planned April 12 meeting of its shareholders to seek approval for the Gloucester deal.
JP Morgan is advising Macarthur, while Rothschild is advising Peabody. MCC firmed 82 cents (5.84%) to $14.87. GCL improved
31 cents (3.44%) to $9.31.

CSR (CSR)

Chinese state-owned food producer Bright Food Company confirmed it has entered talks with CSR about its offer to buy CSR’s
sugar and renewable energy business Sucrogen in a deal that values the operations at $1.75bn. Bright Food said it would keep
Sucrogen’s head office in Australia and plans to appoint independent Australian directors. The group said it is in a position
to lodge an application with Australia’s Foreign Investment Review Board immediately. CSR firmed 10 cents (6.04%) to $1.76.

Virgin Blue (VBA)

Virgin Blue said it signed a previously announced agreement with Boeing to buy up to 105 new 737 aircraft, its largest aircraft
order to date. The new planes, which include 50 firm orders for B737-800NG aircraft to be delivered from June 2011 through
to 2017, will be used to replace existing narrow-bodied 737 aircraft and for deployment on new routes and additional frequencies.
The order includes 25 options over additional firm delivery positions and 30 future purchase rights, but the pricing of the
aircraft wasn’t disclosed. VBA fell 1 cent (1.42%) to $0.70.

Iress Market Technology (IRE)

IRESS Market Technology said the group has seen a continued reduction in cancellations and positive net revenue growth from
its Australia and New Zealand business during the early months of 2010. The group expects flat year-on-year earnings before
interest, tax, depreciation and amortisation for the first half ending June 30 from that division, IRESS said in its annual
report. IRESS said the group has generated modest net revenue increases from the Canadian business in the early months of
2010, given a small price increase and said it expects further positive growth through 2010.

In the Asian financial market business, the group’s cost base is building in anticipation of revenue generation, yet should
be limited to $2m for 2010. The group is looking for acquisitions in the region “where they make sense”. At the Australian
and New Zealand wealth management level, conditions have been positive in the early 2010 as many firms are growing. Regulatory
reviews and takeover speculation are contributing uncertainty to the outlook for this business. For now, the group is expecting
flat first half EBITDA. Management maintains the timing of a full recovery is still difficult to predict. IRE advanced 21
cents (2.63%) to $8.21.

Economic News

February Trade Balance

The ABS reported Australia’s trade deficit continued to widen in February as a robust domestic economy fuelled demand for
imports and a still weak international environment weighed on exports. The wider-than-expected deficit comes despite soaring
prices for commodities exports, illustrating non-mining sectors of the local economy continue to experience relatively less
demand. The balance of trade in goods and services seasonally adjusted widened to a deficit of $1.92bn in February from a
revised deficit of $1.12bn in January.

The Australian Industry Group-PriceWaterhouseCoopers Performance of Manufacturing Index fell in March from February to a level
just above that separating expansion from contraction. A picture of faltering exports was backed up in a private industry
gauge earlier, which showed manufacturers are hurting from a higher exchange rate, rising interest rates and weak demand.

Job Vacancies Rise

The ABS also reported Australian job vacancies rose 12.1% in seasonally adjusted terms during the three-month period ended
February from the previous three-month period. The data comes from surveys conducted in the middle of each calendar quarter.

The NZSX50 added 8.24 points (0.25%) to 3,276.23 while the Nikkei strengthened 154.46 points (1.39%) to be last quoted at
11,244.40 and the Hang Seng gained 200.36 points (0.94%) to be last quoted at 21,439.71.


Categories: trading
tags: ,
Mar 26 2010

Australian Market – Monday, March 29

By SD

Monday, March 29 – The Australian share market was mixed ahead of upcoming US economic data and the Easter long weekend. Falls
in energy, health care, consumer staples and industrials offset gains in materials, consumer discretionary and property stocks.


The All Ordinaries rose 2.0 points (0.04%) to 4,907.2 while the S&P/ASX 200 firmed 0.4 points (0.01%) to 4,897.3.

BHP Billiton (BHP)

BHP said its Kwinana nickel refinery in Western Australia has resumed normal operations after closing down on March 15 due
to a lack of hydrogen gas. The refinery resumed operations on Friday and hydrogen for the operation is being sourced externally.
The refinery was closed after its hydrogen plant broke down and BHP is now assessing what repairs are needed at the plant.

In other news, BHP said its Groote Eylandt manganese operations in Australia’s Northern Territory have been closed as a precaution
ahead of Tropical Cyclone Paul. The mine, concentrator, and port were closed on Sunday and only a skeleton staff remain onsite.
Category two Paul is expected to make landfall early on Tuesday and is forecast to produce wind gusts of up to 140km per hour,
according to the Bureau of Meteorology. BHP has a 60% stake in Groote Eylandt alongside partner Anglo American Corp with 40%.
BHP advanced 10 cents (0.23%) to $43.38.

Commonwealth Bank of Australia (CBA)

Commonwealth Bank opened its first Chinese branch in Shanghai, a state-run Chinese newspaper reported. It cited the bank’s
Group Executive Ian Saines as saying the branch, which is only allowed to do non-local currency wholesaling business for the
first three years, plans to apply for a license to do Yuan-denominated business in three years. CBA fell 33 cents (0.58%)
to $57.04.

Telstra (TLS)

Telstra announced a reshuffle of its executive team, with one executive promoted to look specifically at future challenges
facing the company and different structural models amid ongoing negotiations about whether Telstra will play a part in the
$43bn national broadband network. Some market analysts have suggested that some of the management changes indicate CEO David
Thodey is seriously examining separation as a new structural model for Telstra. Telstra remains in talks with the government
and NBN Co. TLS remained unchanged at $3.06.

Leighton Holdings (LEI)

Leighton Holdings said it has sold the South Tower of its corporate headquarters in Brisbane for $94m to Swiss pension fund
investment body AFIAA. It is fully leased to Leighton Contractors on a 10-year lease. Leighton said it would immediately seek
expressions of interest in the development’s North Tower. LEI weakened 39 cents (1%) to $38.78.

ASX (ASX)

ASX Ltd said it is optimistic about the prospects for its operations in the remainder of fiscal 2010 after observing recent
turnover levels on its Australian Securities Exchange. Based on activity levels in the early weeks of the second half of financial
year 2010, ASX is optimistic about its business growth prospects for the year, as long as global “headwinds don’t dampen the
recovery strength of the domestic economy, or trigger a second round of aftershocks in the global banking system” ASX CEO
Robert Elstone said in a letter to shareholders. It expects to report its results for the year to June 30 on August 19. ASX
weakened 32 cents (0.9%) to $35.28.

Lend Lease (LLC)

Lend Lease said it has closed its fully underwritten $806m retail entitlement offer and will proceed with a bookbuild. It
has received valid applications for 17.6m or 46% of the new securities on offer. The shortfall of 28.2m securities under the
5-for-22 offer at $7.70 per new security will be filled through a bookbuild later. LLC weakened 8 cents (0.91%) to $8.72.

Macarthur Coal (MCC)

Macarthur said it has lifted a declaration of force majeure on coal shipments as the Dalrymple Bay Coal Terminal reopens after
Cyclone Ului. The miner declared force majeure on March 19 when Dalryrmple Bay closed as Ului approached but said that despite
the interruption, it still expects to meet guidance for full year coal sales of between 4.8m and 5.0m metric tonnes. MCC advanced
34 cents (2.91%) to $12.04.

Bank of Queensland (BOQ)

Bank of Queensland said it was in exclusive due diligence for the potential purchase of CIT Group’s Australian and New Zealand
vendor finance operations. It said due diligence is “significantly progressed” but is incomplete at this stage and there is
no guarantee that any deal will occur. BOQ rose 4 cents (0.34%) to $11.81.

Seven Network (SEV)

Seven Network said it has appointed executive search firm Egon Zehnder International to act as an independent adviser on the
composition of its board of directors under its merger and restructure proposal. The television network, which is combining
its business with the earthmoving equipment business WesTrac, said that Egon Zehnder will consult with Seven’s major shareholders
before recommending independent director candidates to its board. The number of independent directors on the Seven Group Holdings
board is planned to increase to five from three. SEV rose 11 cents (1.48%) to $7.54.

Nufarm (NUF)

Nufarm said it made a loss of $40.0m for the six months to January 31, down from a profit of $65.7m a year ago, but said it
expects a recovery in the second half of the year to produce full year net profit of between $80m and $110m. It said its half-year
operating result was a loss of $4.2m after negative material items of $35.8m primarily related to losses from selling inventories
of glyphosate, a key chemical, at prices below book value in the first half. It said the second half of the year is expected
to show recovery during the selling season in Australia, North America and Europe. First-half sales were down 28% to $890.3m
from $1.24bn and the firm will not pay an interim dividend, compared to 12 Australian cents per share a year ago. NUF weakened
7 cents (0.8%) to $8.68.

Sigma Pharmaceuticals (SIP)

Sigma Pharmaceuticals is set to announce a loss of as much as $280m when it releases its full-year results on Wednesday, a
newspaper has reported. Sigma is expected to acknowledge it paid too much for Arrow Pharmaceuticals and to write down around
$320m in goodwill flowing from the deal. The newspaper report said Sigma is unlikely to declare a final dividend. SIP remains
in a trading halt, and was last quoted at $0.90.

Economic News

RBA’s Stevens in First Television Interview

RBA Governor Glenn Stevens in his first television interview said official interest rates are rising toward more normal settings
as the economy improves, warning against excesses in the property market. Recorded on March 22 and broadcast by the Seven
Network, the governor indicated that the central bank has lost none of its hawkish bias. With clear evidence the global recession
has bypassed Australia, emergency policy settings will not be needed, Stevens reiterated. He also again signalled that determining
a normal level for the RBA’s cash rate target is dictated by borrowing costs faced by consumers and business.

The NZSX50 added 10.62 points (0.33%) to 3,251.10 while the Nikkei fell 9.90 points (0.09%) to 10,986.47 and the Hang Seng
strengthened 171.68 points (0.82%) to be last quoted at 21,224.79.


Categories: trading
tags: ,
Mar 25 2010

Australian Market – Thursday, March 25

By SD

Thursday, March 25 – The Australian share market held its ground in mixed trading on Thursday, proving resilient to modest
falls in offshore equities and commodities markets on renewed concerns about the US economy and European sovereign debt problems.


The All Ordinaries fell 6.9 points (0.14%) to 4,896.3 while the S&P/ASX 200 weakened 6.1 points (0.13%) to 4,885.4.

BHP Billiton (BHP) and Rio Tinto (RIO)

News sources have reported some Australian mining-industry participants consider the iron ore joint venture between Rio and
BHP is looking less attractive for Rio, as iron-ore prices rise. With spot iron-ore prices more than double last year’s benchmark,
analysts say an equalisation payment of $5.8bn that BHP would make to Rio as part of the deal in recognition of Rio’s larger
West Australian iron-ore business is now looking cheap. A Rio Tinto spokesman said the company remained “very committed” to
the joint venture. BHP Billiton declined to comment on whether the equalisation payment was being considered, though it cited
the original announcement mentions some flexibility to adjust the size of the payment based on cash flows between July 1 2009,
and the closure of the deal. BHP shed 4 cents (0.09%) to $43.32, and RIO rose $1.42 (1.84%) to $78.62.

National Australia Bank (NAB)

NAB priced $1.5bn in three-year notes at 77 basis points over swap. The offer was split between a $900m fixed rate tranche
and $600m floating rate one. NAB rose 14 cents (0.51%) to $27.51.

Woodside Petroleum (WPL) and Santos (STO)

Woodside CEO Don Voelte dismissed speculation that the company is considering a takeover bid for Santos, a trade publication
reported on its website. “We don’t speculate on market rumour but I can also just tell you that there’s nothing to it. It’s
news to me.” WPL strengthened 6 cents (0.13%) to $47.48.

In other news, Santos maintained its annual production guidance for 2010 and said it continues to monitor the impact of flooding
on its operations following heavy rain in Australia’s Cooper Basin. Santos has given guidance for 2010 calendar production
of between 51m and 54m barrels of oil equivalent. Gas production from Santos’ Cooper Basin continues without impact but road
closures from flooding have caused transportation disruptions. STO firmed 39 cents (2.71%) to $14.76.

Brambles (BXB)

Brambles said it has priced a US$750m bond issue in the US private placement 144A market. The fixed rate notes were split
between a 10-year 5.35% $500m tranche and a five year 3.95% $250m tranche. The notes will be used to repay existing borrowings.
BXB weakened 15 cents (2.02%) to $7.28.

Lihir Gold (LGL)

Lihir Chairman Ross Garnaut said in the company’s annual report the outlook for the gold price remains strong despite volatility
due to declining mine production and rising global demand. The company expects increasing dividend payments to continue for
the foreseeable future. The Lihir Island expansion remains on time and within budget and reaffirmed its previous guidance
for gold production in 2010 and beyond. LGL shed 6 cents (1.95%) to $3.02.

Crown (CWN)

Crown said it will spend $212m to upgrade its VIP playing facilities at its Melbourne casino and entertainment complex as
it seeks to attract more high-roller international visitors. By the first half of 2012, Crown said it will convert its Presidential
Villa in Crown Towers into a gaming club with four private VIP gaming salons, expand its existing premium gaming space, the
Mahogany Room, by nearly 50%, and make a number of other upgrades to spa, accommodation and bar facilities, while also purchasing
a new long range Gulf Stream jet for the use of its VIP international customers. CWN fell 22 cents (2.62%) to $8.17.

Aquila Resources (AQA)

Aquila said a pre-feasibility study indicates that the proposed Belvedere hard coking coal project in Queensland will cost
about $2.81bn to build. Aquila has a 24.5% interest in the project and Brazil’s Vale SA owns 51% and conducted the study.
Vale has an option to buy Aquila’s interest at “fair market value”. Aquila said Vale hasn’t yet indicated whether it will
exercise its option to buy the stake. The first six-month option period commenced December 4, it said. Construction of the
mine could commence in 2014 with first coal mined in 2016. AQA fell 27 cents (2.46%) to $10.71.

Brickworks (BKW)

Brickworks said net profit for the six months to January 31 fell 66% to $88.2m from $255.3m a year ago and said it expects
a solid full year result. Its underlying result, excluding non-regular items that last year included proceeds from the sale
of a coal mine, was up 12% to $57.0m from $50.8m. The firm said it will pay an interim dividend of 13 cents per share, up
from 12.5 cents last year, and said it expects improved demand for building products and continued performance from its investment
division. BKW strengthened 5 cents (0.4%) to $12.65.

Economic News

RBA Financial Stability Review

The RBA said in its six monthly review of the financial system that funding conditions for Australian banks have improved
and life is returning to the market for residential mortgage backed securities. Business credit has begun to stabilise over
recent months and credit supply conditions for the business sector are becoming less restrictive. However, the central bank
indicated that it remains concerned about the commercial property sector where valuations fell markedly. In the household
sector, incomes have continued to grow solidly but the RBA said that higher interest rates appear to have had a dampening
effect on housing finance.

The RBA still sees some risks globally. Market sentiment in the major advanced economies remains vulnerable to the possibility
that further bad news could trigger a renewed heightening of risk aversion. There is a two-speed global economy with weak
conditions in the US and Europe contrasting Asia, where policy makers confront rapid credit growth and rising asset prices.

On the debate over future regulation of banks and financial institutions globally, the RBA reiterated that some considerations
need to be made for country-specific circumstances. The RBA said there needs to be consideration of the difference between
better implementing existing regulation and introducing new regulation.

RBA Assistant Governor Speech

RBA Assistant Governor for Economic Matters Philip Lowe said interest rates will need to continue to “normalise” as confirmation
the economy has entered a firm upswing emerges, low spare capacity becomes evident, and Asian trading partners grow strongly.
He said policy needs to be adjusted based on the bank’s central positive scenario despite ever-present risks to that outlook.
“The alternative of waiting to see how the myriad of risks evolves before adjusting policy runs the significant downside of
moving too late, particularly given that the economy is starting this upswing with less spare capacity than in previous upswings.”

On the housing market, mortgage rates remain around 50 basis points below average. Mortgage rates are currently below the
average level of the past 15 years but are edging higher. He again highlighted that if Australia’s population continues to
grow at its current pace there will need to be a concerted effort to boost resources for housing.

Prices for iron ore and coal are likely to be substantially higher over the next year. A significant rise in the terms of
trade is expected over the year ahead. Lowe said while movements in the terms of trade do not get as much attention as many
of the monthly economic indicators, history suggests that they have a large influence on how the overall economy performs.

A strong exchange rate and slowing in wage growth have meant inflation has declined as expected, while the bank’s liaison
with the retailers suggests there has been significant recent discounting. Lowe also repeated the bank’s line that flexibility
in the exchange rate acts as a buffer for the economy and the local currency should trade at a higher average rate. “There
is also a general acceptance of the view that, over the next few years, our real exchange rate is likely to be higher than
the average over the past decade or so.” The RBA expects an average pace of growth globally, with higher interest rates in
Australia and Asia acting as a magnet for inward capital flows.

The NZSX50 rose 4.83 points (0.15%) to 3,237.55 while the Nikkei firmed 13.82 points (0.13%) to be last quoted at 10,828.85
and the Hang Seng dropped 258.50 points (1.23%) to 20,750.12.


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Mar 24 2010

Australian Market – Tuesday, March 23

By SD

Tuesday, March 23 – The Australian share market hit a nine-week high as banks, resources and energy stocks rallied after Wall
Street found support following the passage of the health care reform bill through the US House of Representatives.


The All Ordinaries rose 40.4 points (0.83%) to 4,887.9 while the S&P/ASX 200 firmed 44.6 points (0.92%) to 4,874.8.

BHP Billiton (BHP) and Rio Tinto (RIO)

Rio Tinto said completion of the proposed iron ore joint venture with BHP in Western Australia may be delayed until late this
year because of “complex and demanding” regulatory challenges. The joint venture, expected to generate more than US$10bn in
synergies, was due to come into effect in the second half of 2010 but is facing delays from an open-ended European Union inquiry.
BHP strengthened 47 cents (1.1%) to $43.06, while RIO rose 69 cents (0.92%) to $75.72.

Westpac Banking (WBC)

A leading newspaper reported Westpac chairman Ted Evans believes interest rates will keep rising for at least five years irrespective
of the cash rates set by the RBA. Another newspaper reported that Westpac CEO Gail Kelly has told major shareholders in a
private briefing that the bank remains under pressure to raise interest rates further, but a backlash from Canberra could
make repricing mortgages and business loans tough in an election year. WBC rose 37 cents (1.36%) to $27.48.

ANZ Group (ANZ)

ANZ is reviewing its 10% investment in Vietnam-based Sacombank now that it has established a presence there. ANZ’s Asia head
Alex Thursby declined to confirm whether ANZ is seeking buyers for the bank holding. Separately, Thursby said ANZ expects
to be locally incorporated in China later this year, as its application to set up a wholly-owned local incorporation in China
is progressing well with mainland Chinese authorities. ANZ gained 75 cents (3.04%) to $25.45.

Asciano (AIO)

Asciano said it has secured a long-term rail haulage contract with freight company Sadleirs Transport that will generate above
$150m revenue over seven years. The contract represents an extension of an existing arrangement between the two companies.
AIO firmed 3 cents (1.62%) to $1.88.

New Hope Corporation (NHC) and Arrow Energy (AOE)

New Hope Corp declined to elaborate on what it would do with $578m in cash it would receive if the sale of its holding in
Arrow Energy goes ahead. The deal is still awaiting approval from shareholders and regulators, with final court approval expected
in August. Shareholders in Arrow will also get a share in a spin-off of Arrow’s international assets called Dart Energy Ltd.
AOE shed 11 cents (2.16%) to $4.99.

In interim results, New Hope Corporation reported a 16% fall in operating profit for the six months to January 31 to $111.6m
on lower contract coal prices, a bit ahead of guidance of $100m-$110m. A new contract price is expected to be agreed on with
Japanese utilities by late March or early April. NHC firmed 2 cents (0.41%) to $4.90.

Sigma Pharmaceuticals (SIP)

Sigma said the release of its annual financial result is being delayed by negotiations with lenders, discussions with its
auditors, and various unresolved issues arising during the course of the result audit. Talks with lenders on the company’s
financial arrangements was necessitated by a worse than expected result, a reduction in expected cashflows, changes in the
estimated cost of capital and a material reduction in the carrying amount of goodwill on the balance sheet. Sigma said these
issues are expected to be resolved on or before March 31. SIP remains in a trading halt, being last quoted at $0.90.

AWB (AWB)

AWB cut its estimated returns on collective sales of wheat for crop year ending March 31, citing a weakening world market
and a stronger Australian dollar. Estimated returns on benchmark Australian Premium White grade were cut $8 to $246 a metric
tonne, free on board, for the Western Pool. The Eastern Pool benchmark was cut $3, also to $246. “It isn’t a good price environment.
The reality is the world is awash with wheat, which means it’s a buyer’s market”, AWB’s Mitch Morison said. Strong Chinese
demand for commodities is also driving sea freight rates higher, with greater competition for vessels meaning it will be more
expensive to ship Australian wheat to Asia. AWB shed 1 cent (1.06%) to $0.93.

The NZSX50 fell 4.93 points (0.15%) to 3,228.37 while the Nikkei weakened 50.57 points (0.47%) to 10,774.15 and the Hang Seng
added 216.14 points (1.03%) to be last quoted at 21,149.39.


Categories: trading
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Mar 23 2010

Australian Market – Monday, March 22

By SD

Monday, March 22 – The Australian share market hit a three-day low in quiet trading with the heavyweight financials, materials
and energy sectors leading broad-based declines after Wall Street lost ground last Friday.


The All Ordinaries fell 42.6 points (0.87%) to 4,847.5 while the S&P/ASX 200 weakened 42.0 points (0.86%) to 4,830.2.

BHP Billiton (BHP)

The Hay Point coal terminal in Queensland sustained some damage from cyclone Ului and remains closed. Cyclone Ului made landfall
on Saturday. The Bureau of Meteorology has downgraded it to below cyclone strength but warned of flash flooding and heavy
rainfall, expecting rain to ease by Tuesday morning. BHP closed a number of mines in northern Queensland as a precaution.
BHP lost 61 cents (1.41%) to $42.59.

Rio Tinto (RIO)

Rio Tinto Chief Executive Tom Albanese expressed regret over losing an opportunity last year to deepen its ties with Aluminum
Corp of China. He also offered to share expertise in future projects. In another version of Albanese’s speech however, he
also said: “Last year saw four of our employees detained in Shanghai. This issue is obviously of great concern to us, as it
would be for any company operating in China. I can only say we respectfully await the outcome of the Chinese legal process.”
RIO fell $1.16 (1.52%) to $75.03.

National Australia Bank (NAB) and AXA Asia Pacific (AXA)

NAB and AXA said they have extended until March 29 the deadline for finalising transaction documents for the $13.3bn (US$12.2bn)
takeover bid for AXA. In separate statements, both parties said the discussions “are at an advanced stage” as AXA directors
continue to recommend the NAB takeover proposal. NAB fell 19 cents (0.71%) to $26.71 while AXA added 1 cent (0.16%) to $6.30.

Australia & New Zealand Banking (ANZ)

ANZ said that it has completed its acquisition of RBS’s retail and commercial businesses in Hong Kong and will launch a new
service for wealth retail customers in the Asia-Pacific region. ANZ is integrating more than 40,000 RBS customers and 350
RBS staff in Hong Kong. ANZ weakened 41 cents (1.63%) to $24.70.

AMP (AMP)

AMP has reduced the interest rate on its home-loan products by 22 basis points in an indication that some liquidity has returned
to local mortgage securitisation markets. The wealth manager said it will cut the rate on its basic variable home loans to
6.27% and its introductory variable home loan rate by 45 basis points to 5.94%. AMP weakened 5 cents (0.79%) to $6.26.

OneSteel (OST)

OneSteel said it has agreed to buy Australian scrap metal dealer Metals Trading for an undisclosed sum. Metals Trading operates
in NSW and Victoria and collects about 120,000 metric tonnes of ferrous, or iron-containing, scrap and 30,000 tonnes of nonferrous
scrap each year. OST lost 6 cents (1.53%) to $3.86.

Arrow Energy (AOE) and New Hope Corporation (NHC)

Arrow Energy said its directors have agreed to sell the bulk of the company’s Australian coal seam gas assets to Royal Dutch
Shell and PetroChina for $3.44bn. The transaction still needs shareholder and regulatory approval. Shell and PetroChina’s
offer of $4.70 cash per Arrow share is 25 cents higher than a previous bid two weeks ago. Shell and PetroChina proposed the
bid in an equal joint venture. They intend to employ a big LNG export project in Queensland using Arrow’s gas as feedstock
by 2012. AOE fell 19 cents (3.59%) to $5.10.

In related news, New Hope Corp said the company will release an announcement regarding its 16.8% stake in Arrow Energy. The
company declined to comment on whether the miner intended to support a revised $3.44bn offer for the bulk of Arrow’s coal
seam gas assets. The board would convene to discuss their options, and would make a statement on the Arrow stake when the
miner released its half year results Tuesday. NHC fell 26 cents (5.06%) to $4.88.

Premier Investments (PMV)

Premier’s first-half net profit fell nearly 14% to $42.4m from $49.2m a year earlier, with the Portmans division dragging
on the bottom line. Discounting has been very competitive over the past six months. Group total sales rose 9% to $476.4m from
$436.5m bolstered by sales growth at Just Group. The group has brought in a new management team in the hopes of turning Portmans
around. Premier’s like-for-like sales were up 1.1% but when Portmans was stripped out, like-for-like sales rose 4.7%. Management
said they are on the lookout for acquisitions but didn’t reiterate that one was likely this year. Premier chief Solomon Lew
said they have been looking at both European and US companies. Premier declared an interim dividend of 38 cents, up from 37
cents. PMV dipped 34 cents (3.77%) to $8.67.

Mineral Resources (MIN) and Mesa Minerals (MAS)

Mineral Resources said the board of Mesa Minerals has agreed to an all-share takeover offer of one Mineral Resources share
for every 70.6 Mesa shares, which values the target at around $64.1m. The offer has been unanimously recommended by Mesa’s
directors. MIN weakened 6 cents (0.83%) to $7.18. MAS rose 1.6 cents (20%) to $0.096.

The NZSX50 rose 2.90 points (0.09%) to 3,233.30 while the Nikkei firmed 80.69 points (0.75%) to be last quoted at 10,824.72
and the Hang Seng dropped 361.72 points (1.69%) to 21,009.10.


Categories: trading
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Mar 21 2010

Australian Market – Friday, March 19

By SD

Friday, March 19 – The Australian share market hit a fresh eight-week high
in quiet trading, with gains in property trusts, consumer staples and energy
stocks offsetting falls in some financials and materials stocks.


The All Ordinaries rose 12.4 points (0.25%) to 4,890.1 while the S&P/ASX 200
firmed 9.1 points (0.19%) to 4,872.2.

Rio Tinto (RIO)

Rio Tinto said it signed a US$1.35bn deal with Aluminum Corp. of China, or
Chinalco, to develop its Simandou iron ore project in Guinea. Under the
terms of a non-binding memorandum of understanding, Rio Tinto said that it
will transfer its holding into a new joint venture with Chinalco, with
Chinalco taking a 47% interest for US$1.35bn. The scope of the proposed
joint venture covers rail and port infrastructure as well as the mine
itself, Rio Tinto said. Rio Tinto and Chinalco will now work on finalising
definitive and binding transaction documentation, Rio Tinto added. RIO
weakened 80 cents (1.04%) to $76.19.

Telstra (TLS)

Telstra warned that the Australian government, NBN Co and the company are a
long way apart in their views of how much any assets Telstra could sell into
the network are worth, but talks are continuing. “Currently there is a
significant gap between Telstra and NBN Co on what each party considers to
be an acceptable financial outcome,” Telstra said. “Telstra is discussing
ways in which the gap can be bridged, recognising that the government has
highlighted the national interest benefits of the NBN and reform of the
telecommunications industry,” it said. Telstra has said it won’t do a deal
if it is not in the best interests of its shareholders. At the same time,
the government has said that the new network must be viable and NBN Co has
indicated in the past that it won’t overpay for assets. TLS remained
unchanged at $3.17.

Fortescue (FMG)

Fortescue said the size of the resource at its Solomon iron ore deposit has
risen to a level that would support its planned mine development. The total
measured, indicated and inferred resource at Solomon, in the Pilbara, has
risen to 2.7bn metric tonnes from 2.4bn tonnes. The miner said the upgrade
is enough to underwrite its plans for an operation targeting production
rates of 60m tonnes of iron ore a year. Fortescue has posted a measured
resource of 66m tonnes, while its indicated resource at Solomon has risen to
720m tonnes from 632m tonnes. FMG fell 5 cents (1.02%) to $4.85.

Amcor (AMC)

Amcor said it is facing a damages claim for alleged price fixing that could
be worth around $697m from a class action by Jarra Creek Central Packaging
Shed. Amcor said that an applicant’s report estimates damages suffered by
Amcor customers are potentially in the vicinity of $466m plus about $231m
interest. “Amcor strongly disputes the estimate put forward and will dispute
the facts and assumptions upon which the report appears to be based,” Amcor
said. AMC advanced 3 cents (0.49%) to $6.11.

AGL (AGK) and APA Group (APA)

AGL said it sold a gas pipeline in Queensland to APA for $82.6m. The
pipeline was built to transport gas from fields now owned by BG Group in the
Surat Basin in Queensland. AGL and APA have also signed a 17-year gas
transportation agreement for the pipeline, under which AGL will be provided
with transport services by APA. The agreement includes an option for
increased capacity, which if triggered would result in APA paying another
$21m to AGL, and could be extended to 27 years. AGL said it will book a
$2.0m pretax profit on the $82.6m sale. The acquisition is expected be
accretive to APA by 2014. AGK rose 12 cents (0.8%) to $15.09 and APA
weakened 9 cents (2.61%) to $3.36.

MAP Group (MAP)

MAP reported traffic at Sydney rose by 12.3% on year, with MAP saying
international passenger numbers were up by 11.8%, while domestic traffic’s
12.3% increase was underpinned by Tiger Airways and Qantas’ Jetstar.
Copenhagen Airport posted a 10.4% increase in traffic and Brussels Airport
traffic was up 4.9%. MAP dropped 3 cents (0.97%) to $3.05.

Mirvac Group (MGR)

Mirvac has priced $150m of 2015 bonds in an issue that was more than twice
oversubscribed. The five year notes were priced at 265 basis points over
swap and the group said the borrowings will not impact its earnings guidance
of 9.2 cents per stapled security for this fiscal year. MGR firmed 2 cents
(1.36%) to $1.495.

Metcash (MTS)

Metcash said it will close its underperforming Campbells Cash & Carry
wholesale distribution businesses, merging parts of it with another
wholesale division in a restructure expected to cost $10.8m after tax.
Metcash said it will close eight of the business’s 20 warehouses due to a
combination of reduced turnover and fixed network costs, and will merge the
rest of the business with its Campbells Wholesale business. The firm expects
the decision to boost earnings before interest and tax by between $4-$5m a
year. A one-off provision of $15.4m will be made in its accounts for the
year to April 30, enabling the firm to reiterate its guidance for normalised
earnings per share to grow by 7%-10% from a year ago. MTS dropped 3 cents
(0.72%) to $4.12.

Arrow Energy (AOE)

Arrow placed its shares in a trading halt as speculation mounts that the
coal seam gas company is about to endorse a sweetened takeover bid from
Royal Dutch Shell and PetroChina. Arrow said shares will be halted from
trading until Tuesday, or until it makes its next announcement on what is
currently a $3.3bn offer. All three parties have been locked in discussions
for almost two weeks. AOE was last quoted at $5.29.

Western Areas (WSA)

Western Areas said total probable reserves at its Spotted Quoll deposit in
Western Australia are now 90,100 metric tonnes of nickel. The miner said the
Tim King Pit at Spotted Quoll is now estimated to contain 70,200 tonnes of
nickel and this takes total probable ore reserves at the deposit to 2.1m
tonnes at an average grade of 4.3% nickel for 90,100 tonnes of nickel.
Western Areas said first ore production from the Tim King Pit is on track to
start in April and a feasibility study on an underground mine is due to be
completed in August. WSA added 3 cents (0.61%) to $4.95.

The NZSX50 added 9.72 points (0.30%) to 3,230.40 while the Nikkei
strengthened 80.69 points (0.75%) to be last quoted at 10,824.72 and the
Hang Seng fell 42.38 points (0.20%) to 21,288.29.


Categories: trading
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Mar 21 2010

Australian Market – Wednesday, March 17

By SD

Wednesday, March 17 – The Australian share market rose 1.2%, posting its
biggest one-day gain in over three weeks, after US policy makers maintained
a dovish stance on interest rates and Greece avoided a credit rating
downgrade.


The All Ordinaries rose 57.8 points (1.20%) to 4,866.9 while the S&P/ASX 200
firmed 56.0 points (1.17%) to 4,853.2.

BHP (BHP)

BHP said its Hay Point coal export terminal in Queensland remains closed and
is starting to affect production at some coal mines and rail operations. The
port was closed on March 11 due to high winds and rough seas and BHP said it
was continuing to monitor conditions to decide when it was safe to resume
berthing vessels. “Railings at the terminal and production at some mines is
being impacted as stockpile limits are approached,” BHP said. BHP gained 55
cents (1.29%) to $43.30.

GPT (GPT)

GPT said that it has sold its Homemaker shopping mall in the Sydney for
$25.2m. GPT said the sale of the remaining three Homemaker centres continues
to progress. Chief Executive Michael Cameron said that GPT is in no rush to
sell non-core assets, such as its Ayers Rock Resort or US assets, and will
probably hold onto them for a year or two. Cameron was specifically
referring to the $300m Ayers Rock Resort in Northern Territory and a US
seniors housing portfolio worth $152m, a GPT spokesperson said. GPT lost 1
cent (1.75%) to $0.56.

David Jones (DJS)

David Jones said net profit for the six months ending January 23 rose 10.2%
from a year earlier. Management reiterated previous guidance while striking
a tone of caution about the recovery of the Australian retail sector. Chief
Executive Mark McInnes said that the environment is “extremely
unpredictable” over the next six months and said management is “very
cautious” about the fiscal fourth quarter. “There is still an overhang of
consumer nervousness from last year,” McInnes said. The group said, to
achieve the top end of the fiscal 2011 guidance “the retail recovery will
have to be in full swing.” Earnings for the first half were $100.5m, up from
$91.2m a year earlier and in line with guidance the group gave in February.
David Jones declared an interim dividend of 12 cents, up from 11 cents a
year earlier. Management reported gross profit margins of 40% and said this
was achieved through renegotiated supplier contracts, the reallocation of
space to high margin categories and growth in department store exclusive
brands. DJS rose 6 cents (1.18%) to $5.13.

AWB (AWB)

AWB downgraded its guidance for full year profit before tax and one-time
items to $85m-$110m from previous guidance of $115m-$140m, citing a tougher
grain marketing environment. AWB now expects to report a first half profit
for the period ended March 31 of $25m-$35m. “Except the Australian grain
marketing business, all key operating businesses were trading broadly in
line with expectations, on the back of improved seasonal conditions in
Australia and strong support from international customers”, Managing
Director Gordon Davis said. AWB fell 12 cents (11.37%) to $0.935.

Corporate Express (CXP)

Staples Inc launched a $5.60-a-share takeover bid for Corporate Express
Australia, valuing the target company at $1bn. The board of the company has
unanimously recommended the offer, subject to no superior offer emerging,
and signed an implementation agreement, Staples said. Shareholders will
still receive a 12.5 cent dividend announced on March 2, giving a total
value of $5.725 a share. Corporate Express is also proposing to pay a
special dividend of up to 78 cents a share, which, if approved by the
Australian Tax Office, will reduce the offer price by that amount. CXP
advanced $1.11 (24.13%) to $5.71.

Macmahon (MAH)

Macmahon said that it has won a three-year contract worth more than $190m
from Syntech Resources to develop and operate the Cameby Downs coal mine in
the Surat Basin in Queensland. Macmahon will carry out all mining activities
in Stage 1 of the project, with the first coal train load expected in
October 2010, the company said. MAH gained 2 cents (2.03%) to $0.755.

Economic News

Housing figures

The total number of houses and apartments that started construction in
Australia in the fourth quarter of 2009 rose 15.1% to a seasonally adjusted
40,022 versus a rise of 11% in the third quarter, and a fall of 13.5% in the
4Q last year. The ABS also reported that the number of private-sector houses
started in the fourth quarter rose 13.4% from the previous quarter to
28,343.

Interest rates

RBA Assistant Governor Guy Debelle said interest rates are likely to rise
further but noted that higher levels of household debt mean changes to
monetary policy have a larger impact than in the past. Debelle also said
that the market for the securitisation of debt appears to be recovering
based on the number of securitisations carried out this year. “It is now
becoming a competitive source of funds again,” he said. Debelle said lending
from non-bank lenders is on the rise and this is because their source of
funding is now close to being competitive with that of the larger banks.

The NZSX50 fell 6.84 points (0.21%) to 3,200.96 while the Nikkei added
125.27 points (1.17%) to be last quoted at 10,846.98 and the Hang Seng
strengthened 330.69 points (1.57%) to be last quoted at 21,353.62.


Categories: trading
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Mar 21 2010

Tuesday, March 16

By SD

Tuesday, March 16 – The Australian share market rose slightly in quiet
trading ahead of a Federal Open Market Committee meeting in the US.


The All Ordinaries rose 9.6 points (0.20%) to 4,809.1 while the S&P/ASX 200
firmed 13.2 points (0.28%) to 4,797.2.

CBA (CBA)

CBA has launched a $3.5bn debt offering. The senior fixed-rate notes will be
sold to investors eligible to participate in the SEC-Rule-144a
private-placement market. The three-part issue will include $750m of
three-year floating-rate notes. The first will be launched at a spread of 55
basis points over the three-month London Interbank Offered rate, a second
$1.75bn five-year fixed-rate note tranche, launched at 120 basis points over
Treasury’s, and a third at $1bn 10-year piece, launched at a spread of 135
basis points over Treasury’s. All three pieces were launched directly in
line with preliminary price guidance levels. The offering has been rated Aa1
by Moody’s Investors Service and AA by Standard & Poor’s. CBA strengthened 8
cents (0.14%) to $55.68.

ANZ (ANZ)

ANZ will sell its 10% stake in Saigon Thuong Tin Commercial Joint Stock
Bank, or Sacombank, according to an official from Sacombank. “Now that ANZ
has opened a wholly owned bank in Vietnam, it wants to sell the stake to
avoid any possible conflict of interest”. It’s not clear yet if the stake
will be sold to a foreign or local buyer, the official added. A final
decision regarding the buyer is expected by the end of the week. ANZ rose 13
cents (0.54%) to $24.15.

Rio Tinto (RIO)

Rio Tinto released its annual report, stating it would work to extend its
relationship with Chinalco and pursue business opportunities to their mutual
benefit. Rio Tinto Chairman Jan du Plessis said in the report the miner
faced concerns related not only to the financial terms of the aborted
Chinalco transaction, but also discomfort about the structure of its
potential relationship with Chinalco. “The board could not ignore these
feelings although, in deciding not to proceed with that transaction, we
deeply regretted the loss of a unique opportunity to establish a partnership
that would have fundamentally changed our relationship with our largest
customer base.”

Separately, a newspaper reported that Rio Tinto and Chinalco are in advanced
talks to jointly develop the Simandou iron-ore project in the West African
nation of Guinea. The paper said negotiations between the Anglo-Australian
miner and China’s biggest aluminium producer have been ongoing in Beijing.
The talks are limited to areas such as utilising China’s political contacts,
financing capabilities and experience developing infrastructure in Africa,
the paper said. Development costs for this project are expected to be around
$12bn according to the article. RIO rose 12 cents (0.16%) to $75.50.

Telstra (TLS)

Telstra said it has priced a EUR1bn ten-year bond, in a deal that was six
times oversubscribed. Around 300 orders made up the book build of the 4.25%
March 2020 notes, from a mix of fund managers, insurance companies and
banks, the company said. The capital will be used to retire shorter-term
bank debt and general purposes. Telstra didn’t provide pricing on the
transaction but market participants had said price guidance was around 105
basis points over mid-swaps. TLS gained 7 cents (2.3%) to $3.11.

Leighton Holdings (LEI)

The Western Australian state government said it awarded a construction
contract to a joint venture between Leighton Holdings and Indigenous
Business Australia for its Ord-East Kimberley Expansion Project. The
development project is worth $220m, the state government said. LEI fell 59
cents (1.51%) to $38.37.

Suncorp-Metway (SUN)

Suncorp-Metway said claims costs from recent storms in Victoria would reach
$200m, the maximum event retention under the group’s property catastrophe
reinsurance cover. The group has received about 35,000 insurance claims
related to the severe weather. Separately, Suncorp-Metway has received 1,600
claims with an estimated cost of $25m-$30m due to recent flooding in south
Queensland. SUN firmed 6 cents (0.7%) to $8.63.

Stockland (SGP)

Stockland Managing Director Matthew Quinn said the company gained market
share in its residential business in the latest quarter as debt-wary home
buyers embraced its low cost housing products. “Our share of markets is
going up because we’ve had the courage to deliver smaller products.” The
company is on track to meet its full year earnings guidance according to
Quinn. SGP shed 1 cent (0.25%) to $3.95.

GPT Group (GPT)

GPT Chief Executive Michael Cameron said in an interview the company
probably won’t offload its $700m worth of non-core assets in Australia and
the US for another one or two years. Market conditions have since improved,
and GPT is now not actively marketing the $300m Ayers Rock Resort in
Australia’s Northern Territory, a US seniors housing portfolio worth $152m
or the remaining malls in its $222m Australian Homemaker City portfolio.
“The assets remain for sale but given the strength of the balance sheet at
the moment, we’re not a forced seller and we’ll probably sell once those
markets strengthen over time.” The prospects of Ayers Rock Resorts also
improved last week when low-cost carrier Virgin Blue said it will start
flying to Uluru from August.

Regarding potential acquisitions, Cameron said the company has more than
$2.5bn in excess funding capacity and can seek partners to make joint bids
for assets, citing its existing relationship with Government of Singapore
Investment Corp as an example. He reassured that GPT will focus on the
domestic property market. The company’s current $2.4bn Australian
development pipeline will likely take about three to five years to build,
although Cameron wouldn’t completely rule out a move offshore in the longer
term. GPT rose 1 cent (1.79%) to $0.57.

Seven Network (SEV)

Seven said that its independent expert has concluded in favour of its plan
to merge with Chairman Kerry Stokes’ WesTrac Holdings. In its scheme
documents, Seven Network said Deloitte valued its shares at $7.63-$9.51 each
on a controlled basis, with a mid-point of $8.57. Seven said Deloitte
explained the wide range reflects the nature of Seven’s assets, and the
valuation includes a 17 cent interim dividend, which will be paid to
shareholders on April 16. Stokes will emerge with a 68% stake in the
combined company if the transaction goes as planned. He currently has a 48%
stake in Seven Network, which will be renamed Seven Group Holdings Ltd.

Under the terms of the deal, which values WesTrac at $2bn including $1bn of
debt, Stokes’ Australian Capital Equity, will be issued with 115m shares in
the new Seven Group Holdings, which implies a value of $8.70 per Seven
Network share. If approved, Seven Network’s media platforms including stakes
in the Seven television network, West Australian Newspapers, and Foxtel
part-owner Consolidated Media Holdings, will be combined with WesTrac’s
Caterpillar tractor and heavy equipment dealership chains in Western
Australia, NSW, the ACT and in North East China. SEV rose 3 cents (0.38%) to
$8.00.

Economic News

RBA Minutes – Rate “Normalisation” Justified

Evidence that economic conditions are quickly returning to normal in
Australia drove a decision by the central bank to raise interest rates
further at the start of March. “On balance, members concluded that the
evidence that had become available recently had confirmed that it remained
appropriate for interest rates to move gradually towards normal levels,”
minutes of the Reserve Bank of Australia’s March 2 board meeting said. The
RBA has already indicated that a normal cash rate is around 4.50% to 4.75%.
The RBA noted “significant momentum” in house price growth, solid
consumption spending, a pickup in dwelling activity and an expected mining
upswing as evidence that a broad-based recovery in the economy is underway.
The RBA said that while some weakness existed in the global economy, Asia
was strong.

Australia’s economy grew by 0.9% in the fourth quarter from the third,
bringing the on-year rate of growth to 2.7%. “Some indicators suggested that
growth might already have been running at close to trend for a few months,”
the minutes said. The RBA remains confident that its forecast of falling
inflation by the end of 2010 remains intact. It said falls in private-sector
wages growth supported the view inflation would be around 2.5% by year end,
down from an expected 3.0% midyear. The minutes also said the RBA considered
at the meeting mounting risks in the global economy, especially the threat
of sovereign default in Greece. But the issue was not considered big enough
to warrant the suspension of a rate hike in March. Problems in Europe could
result in renewed international turmoil, “but while such an outcome could
not be ruled out, it was not the most likely one,” it said.

The NZSX50 fell 23.35 points (-0.72%) to 3,207.80 while the Nikkei weakened
30.27 points (0.28%) to 10,721.71 and the Hang Seng dropped 25.47 points
(0.12%) to 21,053.63.


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