Looking across global markets there is an interesting conundrum.
In Australia the key sharemarket gauges have barely moved in the
March quarter, up around 0.5%.
But in the US and the UK therehave been gains of 4-5%, while
even the Japanese Nikkei hasrisen by 2%.
We forecast significant medium and long-term order book growth and margin expansion acrossthe sector. As the Australian economy shifts gear post the pause in construction and mining during the GFC, CBA expects:revenue growth via a five year commodity boom, and margin growth, driven by demand outstripping supply, and labour and equipment shortages, shifting the balance of power back to contractors.
The general view is that the US dollar will lift later in 2010
when rates start rising. And in Australia investors are spoilt for choice with term deposits, property and shares all providing good returns.
Todays australian market wrap up
TALK OF A TAKEOVER BID FOR SANTOS - Sydney Morning Herald says there are strong rumours circulating that Woodside (WPL) is set to launch a $15bn bid forSantos(STO). STO up 3.41% to 1486c. WPL down 46c to 4696c.
AXA’s parent company AXA SA says they are confident that a deal can be reached with theNational Australia Bank (NAB) by the March 29 deadline. The NAB is offering AXA $13.3bn and is hoping to sell AXA’s Asian operations to AXA SA with price being the issue. Even if they come to an agreement, uncertainty will remain until the ACCC release their ruling on April 22. If unfavourable, AMP will enter the picture again. AXA up 1c to 634c, NAB up 15c to 2751c, AMP down 7c to 628c.
Crown (CWN) will spent $212m to significantly expand and upgrade their VIP facilities at Crown, Melbourne. The initiative is expected to create 200 new jobs. The market doesn’t seem to like the idea – CWN down 2.62% to 817c
Brickworks (BKW) announced a 65% fall in 1H net profit to $88.2m but expect a “solid” FY result due to lower interest expenses. They say their Building Products division has improved “due to the initial signs of recovery that are already evident in the housing market”. BKW up 4c to 1264c.
AquilaResources (AQA) announced a pre-feasibility study indicated that the proposed Belvedere hard coking coal project in QLD will cost around $2.81bn to build. AQA down 2% 1076c.
Western Areas(WSA) – Trading Halt before their convertible bond issue. WSA last traded at 528c.
One broker has upped their iron ore forecasts by as much as 90% for 2010, up 60% compared to last year.
Brambles (BXB) has priced a US$750m bond issue in the US private placement. BXB down 5c to 738c.
RBA assistant governor, Philip Lowe, says interest rates in Australia will likely need to continue to move towards normal levels.
Companies hitting fresh 52 week highs today include:Automotive Holdings (AHE), Ausdrill (ASL), Cochlear (COH), Iluka Resources (ILU), News Corp (NWS), REA Group (REA) and Ramsay Healthcare (RHC).
