17 Jan 2014
Twenty First Century Fox shares have continued to fall following the company’s announcement of its intention to de-list from the Australian stock market. This follows the company’s separation from the old News Corp empire.
Telstra continues to build a war chest with the sale of 70% of their Sensis business (think white and yellow pages) to a US firm. This follows the sale of their Hong Kong mobile business for $2bn.
Transurban Group (toll road operator) lifted toll revenue an impressive 12.6% in the December quarter of 2013. The company also announced the completion of the M2 upgrade and affirmed that the M5 project is on schedule and budget.
Rio Tinto announced record production for iron ore, bauxite (for aluminium), and thermal coal in 2013. Iron ore production for 2013 of 266 mega tonnes set a new annual record.
The Australian share market finished relatively flat for the week after a choppy week driven by both US and local economic data.
US stocks look likely to finish the week slightly higher even though they were hurt by a lower than expected jobs data reading and a round of disappointing reported company earnings.
European stocks have continued their stellar run from the end of last year, climbing to a 6 year high. This week, financial stocks were helped after the Basel Committee (worldwide banking supervisory authority) relaxed debt limit rules for banks in the region.
The Aussie dollar rose earlier in the week hitting close to 91 cents against the US dollar before poor Australian jobs data cut the gains. It dipped as low as 87 cents overnight, its lowest since July 2010, before recovering to finish a cent higher.
Australian new home sales hit a 36 month high in November. Sales of new homes were up 7.5% in November alone with detached homes up 3.6% and apartment dwellings up 30.5%. Data across the states was mixed, with NSW only recording a 0.1% rise in new home sales.
The number of job ads fell in December for the 3rd straight month, but the pace of deterioration in the labour market is moderating. Over 2013, the number of advertised positions dropped 9.1%.
The unemployment rate was unchanged in December at 5.8%, even though the total number of people with jobs fell 22,600. Concerningly, full time employment fell 31,600 whilst part time employment was up 9,000. The participation rate (those in work or seeking work) continues to fall and is now at a 7 year low.
China’s trade data came in slightly below expectations with very strong import figures. A positive for Australian resources.
US jobs data spooked markets globally with the US economy only adding 74,000 jobs last month, well below expectations and the smallest gain in 3 years. In contrast, the unemployment rate fell to 6.7% (from 7%) due mainly to workers leaving the workforce.
The World Bank raised its growth forecasts for the global economy, but warned of potential volatility in capital flows as the US withdraws its stimulus.
PM Abbott has likened the campaign against people smugglers to a war. Under increasing pressure from the opposition for more transparency, PM Abbott said that releasing information would help people smugglers and put asylum seekers’ lives at risk.
PM Abbott also made the headlines and won praise after travelling economy class from Sydney to France with his family…the PM in coach, who would’ve thought….He even refused the offer of an upgrade.
The US house of representatives overwhelmingly approved a US$1.1 trillion spending bill for fiscal year 2014, signalling some sort of truce in 3 years of budget battles. The bill, if passed by the senate (which it is expected to), funds the federal government under the budget framework recently hammered out…..finally, some sense has prevailed.