BusinessNow: Live coverage of financial markets and companies, plus analysis and opinion
Resources pushed the ASX 200 higher, with BHP hitting an 11-month high.
- BHP is on a heater
- Stocks hit 4-week high
- Quadrant snaps up Fitness First
- CBA cuts term deposit rates
- ASX hits chart resistance
Welcome to the BusinessNow blog for Thursday, September 29. Energy stocks are shooting higher on the surprise OPEC deal overnight, while the broader market is also in positive territory.
8.34pm:Germany’s Commerzbank to cut 9,600 jobs
Germany’s second largest lender Commerzbank said on Thursday it plans to cut 9,600 jobs by 2020 and withhold dividends to pay for a €1.1 billion ($1.61bn) restructuring.
The Frankfurt-based firm added that the plan, still to be agreed at a supervisory board meeting on Friday, would see it report a loss in the third quarter as it writes down the value of goodwill and other intangible assets.
But it forecasts a “slightly positive” bottom line for the whole of 2016. Read more.
8.10pm:Public wants PM action on energy security
Barry Fitzgerald
At last some leadership from Malcolm Turnbull on a most serious issue — energy security.
“Energy security should always be the key priority. If you are stuck in an elevator, if the lights won’t go on, if your fridge is thawing out … because the power is gone, you are not going to be concerned about the particular source of that power. Whether it is hydro, wind, solar, coal or gas, you want to know that the energy is secure.’’
Rarely has the PM made more sense. Read more.
7.46pm:Higher US rates ‘could spur investment’
Higher interest rates in the US could spur greater business investment, a top Federal Reserve official said on Thursday.
Ultralow interest rates may be encouraging firms to use cheap debt to reward investors by buying back shares. Patrick Harker, president of the Federal Reserve Bank of Philadelphia, said while answering questions following a speech in Dublin.
“Continued normalisation of our policy path would be a good thing in possibly bringing back some business investment,” Mr Harker said at an event hosted by the Global Interdependence Centre, a US think tank that promotes free trade. He acknowledged his suggestion was a theory.
The Federal Reserve left short-term interest rates unchanged this month but signalled it still expected to raise them before year-end. Dow Jones.
7.10pm:Biotechs trials ‘could move offshore’
Sarah-Jane Tasker
Australia’s biotech sector has warned that local clinical trials will go offshore if the government backs recommendations made in a review of the research tax incentive.
Chris Nave, managing director of Brandon Capital Partners, said a recommendation to cap at $2 million the cash refund smaller companies could claim for research and development would affect clinical trials in Australia.
“At $2m, it will stop overseas companies doing their clinical development here because $2m isn’t worth the cost of setting up an Australian company,” he said.
“I am really concerned for the Australian-based contract clinical research organisations that have benefited from an enormous amount of inbound commercial work as a result of the tax rebate, because that will disappear with that cap.” Read more.
6.46pm:London shares push higher
The UK’s FTSE 100 has lifted 1.14 per cent in early trade, benefiting from the news that OPEC members have reached a consensus to cut output to between 32.5M and 33M b/d in November. “The news sent oil prices sharply higher and has helped energy names overnight while buoying sentiment in the general commodity space,” said Michael van Dulken at Accendo Markets.
The price of Brent rose above $US48/bbl, while BP gained 4.4 per cent in early morning deals and Royal Dutch Shell lifted over 5 per cent.
“On the face of it, a step in the right direction from OPEC, with Saudi Arabia importantly ceding ground. However, digging down it’s merely an intention to agree something concrete further down the line,” Mr van Dulken warns. Dow Jones
6.24pm:BoJ door open to lower rates
Bank of Japan Governor Haruhiko Kuroda signalled on Thursday that interest-rate reductions would be his first tool of choice if additional easing becomes necessary.
“Speaking of specific options for additional easing, first, we can consider lowering our targets for the short-term policy rate or long-term yields,” Mr Kuroda said at a convention of Japanese securities dealers. He then cited asset-purchase expansions as another option.
Mr Kuroda continued to distance himself from his previous signature measure to grow the yen’s monetary base -- banks’ yen reserves and currencies in circulation -- at an annual pace of 80 trillion yen.
The BOJ may think about expanding only if situations warrant, he said. The BOJ scrapped the monetary base target last week. Dow Jones
5.31pm:Dollar retreats from three-week high
The Australian dollar has fallen back from the three week high it hit after commodity prices surged on a surprise agreement by the world’s top oil producers to cut production.
At 5pm (AEST) on Thursday, the local unit was trading at US76.64 cents, down from US76.85c on Wednesday.
The Australian dollar touched a high of US77.10c in late morning trade as investors piled in following OPEC’s decision, but the currency lost momentum in the afternoon.
Westpac chief currency strategist Robert Rennie said OPEC’s oil production decision overnight, and recent price rises in coking coal and thermal coal, weren’t the only factors behind its rise.
“Lower rates for longer and positive equity pricing also helped sentiment,” he said. AAP
5.15pm: Tokyo stocks surge on OPEC deal
Energy firms soared in Tokyo on Thursday, leading a Japanese stockmarket rally as oil prices were boosted by a surprise OPEC deal to cut crude production.
Tokyo’s benchmark Nikkei 225 index climbed 1.39 per cent, or 228.31 points, to 16,693.71, while the broader Topix index rose 0.94 per cent, or 12.48 points, to 1,343.25. AFP
4.48pm:Shell offloads Beach stake
Bridget Carter
Shell has divested a stake it owned in Beach Energy.
There were 45 million shares divested in the market on Thursday at 63c each, in a trade handled by UBS.
The company secured a small stake in Beach through its acquisition of BG Group.
Thursday’s trade represented an interest of about 2.4 per cent in the business.
Shares on Thursday closed up 6c to 66c.
4.26pm:Stocks close near four-week high
Australia’s share market closed near a four-week high as surging oil prices led a solid rally.
The benchmark S&P/ASX 200 finished up 1.1 per cent at 5471.3 points after rising as high as 5473.3 in late trading, its highest point since the end of August.
Resources sector heavyweight BHP Billiton closed up 4.7 per cent to $22.40, having reached an 11-month high of $22.54. That followed a 5.3 per cent rise in WTI crude oil to $US47.05 a barrel after OPEC’s agreement to reduce its production in a bid to lift oil prices.
Elsewhere in the energy sector, Woodside Petroleum rose 7.3 per cent to $28.45, Santos jumped 7.6 per cent to $3.67 and Origin Energy gained 7.4 per cent to $28.45.
Read more
4.05pm:Inghams float a test of poultry power
The coming $1.5 billion Inghams float will rely in part on CEO Mick McMahon’s management and a highly concentrated industry structure, writes John Durie.
The top two players in Australia — Inghams Enterprises and Baiada, with its Steggles and Lilydale brands — account for 73 per cent of the market.
This gives the poultry players some leverage against the supermarket giants — but only some.
The chicken companies are helped by the fact there won’t be any import competition any time soon.
TPG paid $900 million for Inghams in 2013 and quickly recovered circa $550 million through property sales, so a profitable exit is already in the bag.
3.30pm:Aussie dollar looking toppish: ANZ
ANZ doubts that next week’s RBA meeting or retail sales data will provide a reason for the Australian dollar to break higher, and expects the US dollar to be range bound as Hillary Clinton claws her way back in opinion polls and a December rate hike in the US remains around 50 per cent priced in.
Moreover, ANZ says, the recent move higher in the Australian dollar hasn’t been well aligned with moves in rates, commodities, or beta (global risk appetite).
In particular, with crude oil getting a boost from OPEC, iron ore near the top of its trading range, and less room to cut rates in Canada contrasting with a continuation of the easing bias in Australia, ANZ sees downside risks to AUD/CAD.
“More broadly, we note that economic fundamentals – although a poor guide in recent years to the cross – all suggest AUD/CAD should be substantially lower than it is currently,” says ANZ’s head of FX strategy Daniel Been.
The Australian dollar was last trading at US76.87c.
3.12pm:Whyalla damage risk from SA outage
South Australia’s state-wide power outage will cause major damage to the struggling Whyalla steelworks, where production has stopped, the blast furnace is cooling rapidly and molten steel risks soldifiying, if power cannot be restored in the coming hours.
The severe weather conditions and resultant power outage have wreaked havoc on the state’s big industrial and mining projects, forcing BHP Billiton to temporarily shut down the big Olympic Dam copper and gold mine, and Oz Minerals to do the same at its flagship Prominent Hill mine.
The administrator of steelmaker Arrium, which owns the Whyalla steelworks, said power was needed by 5pm to avoid a “critical stage”.
2.50pm:BHP’s Olympic Dam temporarily shuttered
BHP Billiton has been forced to temporarily shutter operations at its flagship Olympic Dam mine due to the severe weather conditions and consequent power outage in South Australia
The mining giant said that despite backup power generators kicking into gear to allow the operation of critical infrastructure, it was unable to continue mining.
Daniel Palmer
Read more
2.35pm:Taking profit on Rio options
Market Matters has just told subscribers to take profit on a Rio Tinto options spread trade. It had previously recommended investors to go long Rio $50 October Call options and short Rio $53 October Call options for a cost of $1.15 a share.
It’s now advising subscribers sell that position for around $1.65 a share, booking a 43 per cent profit. Rio Tinto shares were last up 3.7 per cent at $51.84.
2.20pm:BHP is on a heater
BHP Billiton is having its best session in over five months and has cracked a fresh 11-month high as a surprise OPEC production deal sees investors dive into the resources space.
Stronger iron ore prices are also boosting BHP’s share price, with Dalian iron ore futures up about 3.6 per cent in afternoon trade.
BHP has jumped 4.8 per cent to $22.41, its highest level since November last year, and is on track to record its best one-day rise since April 19.
The world’s biggest miner has single-handedly pushed the ASX 200 around 13 points higher for the day. The local index is up 1.1 per cent to 5469.7 points.
Elsewhere Rio Tinto, which is far less exposed to the oil price than BHP, is 3.7 per cent higher, while Woodside Petroleum is up a hefty 7.5 per cent.
Beach Energy is 12.1 per cent higher for the day, Origin Energy has gained 8 per cent and Santos is up 7.6 per cent.
1.55pm:Stocks hit four-week high
Australia’s S&P/ASX 200 share index has hit a fresh four-week high of 5466.9, after rising 1 per cent.
It’s not immediately clear if this is a decisive move above resistance from former support at 5465.
Share trading volume is 11 per cent below average, so perhaps this is a false break. However, the rise in iron ore futures points to a stronger fixing for spot iron ore today and that could generate further strength in iron ore miners.
Indeed, BHP is powering ahead right now, up 4.7 per cent at a fresh 11-month high of $22.40.
1.48pm:Quadrant snaps up Fitness First
Quadrant Private Equity has waded deeper into the gym business, securing Fitness First Australia from Oaktree Capital Management.
The buyout firm is understood to have signed the deal today, and comes after it recently purchased the Goodlife Health Clubs from Ardent Leisure for $260 million along with Jetts Fitness.
The deal was exclusively revealed by The Australian online and comes after the parent company, Oaktree Capital Management, placed the operation up for sale earlier this year.
Bridget Carter
1.40pm:On the cusp of a sharemarket rally?
With the proportion of analyst buy ratings bouncing off a record low, it’s tempting to think the market can at least retest the August peak at 5611 from here.
The S&P/ASX 200 is currently 1 per cent higher at 5465 as energy companies rally on the OPEC deal.
Is a sharemarket rally around the corner?
1.32pm:Programmed shares tumble 20%
Shares in Programmed Maintenance Services have slid more than 20 per cent after the labour hire and maintenance group slashed its earnings guidance for the current financial year.
The company (PRG) now expects EBITDA earnings for the current fiscal year to be about $100 million, down from its previous estimate of $120m.
Read more
1.22pm:Property turnover skewing price data?
A shortage of properties coming onto the market – in part tied to the end of the mining boom – could be skewing house price data, property analytics group CoreLogic has said.
The analysis found 4.9 per cent of dwelling stock was shifted nationally over the 12 months to June, meaning it would take an average 20.5 years for national housing stock to fully turnover.
Daniel Palmer
Read more
1.02pm:Avita shares rise on Iran expansion
Avita Medical, the company commercialising the spray-on skin designed by Fiona Wood, has announced it is to open a clinic for its regenerative medical devices in Iran.
The news follows the announcement this week that vitamins maker Blackmores is expanding into Iran.
Avita, which specialises in new treatments for wounds and skin defects, said the clinic in Tehran would in the first instance treat patients for repigmentation and scar reconstruction.
“Using a dedicated clinic is a new approach for Avita, and we believe it will give us real focus to reach this important market,” Avita Medical’s CEO, Adam Kelliher, said.
Shares in the company were tracking 3.3 per cent higher at 9.5c on the Iran news.
Sarah-Jane Tasker
12.48pm:Actinogen shares slump 33%
Actinogen shares have slumped after the Australian biotech company warned the US regulator wants more details on its Alzheimer’s drug.
The company said today questions posed by the FDA around potential safety surveillance of its drug Xanamem had to be answered before patients could be treated in the US.
“Actinogen will communicate with the FDA shortly and if the questions cannot be resolved in a reasonable time Actinogen will not be able to recruit patients in the Phase 11 Alzheimer’s disease clinical trial by the end of 2016,” the company said.
Shares in the company are down 33 per cent to 4.3c.
Actinogen’s drug Xanamem works by blocking the production of cortisol — the stress hormone — in the areas of the brain most affected by Alzheimer’s.
Sarah-Jane Tasker
12.35pm:China iron ore futures extend overnight rise
China’s Dalian iron ore futures have risen as much as 4 per cent to CNY424.5 a tonne as short covering continues before National Day holidays in China close commodity exchanges all of next week.
This rise could give an additional boost to Aussie iron ore miners today, but iron ore prices are expected to struggle in the coming months on the back of rising supplies and a seasonal slowdown in steel production in China before year end.
Bloomberg’s consensus year-end forecast for spot iron ore is $US49 a tonne versus last night’s fixing at $US56.48.
12.25pm:CBA cuts term deposit rates
Commonwealth Bank has unwound a handful of term deposit rates put in place to offset the fallout from holding back half the Reserve Bank’s rate cut from homeowners, writes Michael Bennet.
Ahead of hearings by the big four banks before a parliament committee next week, CBA has sliced one-year term deposit rates to as low as 2.4 per cent, down from the 3 per cent promotional rate following the RBA’s lowering of the cash rate to a record low 1.5 per cent in August.
CBA’s two-year rate has also been lowered, while the promotion on the bank’s three-year term deposit was left unchanged.
12.04pm:ASX hits chart resistance, awaits catalysts
Australia’s S&P/ASX 200 share index has hit chart resistance from former consolidation support at 5465 points after oil stocks surged on the back of sharply higher oil prices, and iron ore miners also benefit from higher commodity prices.
While a break above 5465 could clear the way for a test of the August peak at 5611, the index may need a fresh catalyst for further gains from here.
However, consolidation above former resistance around 5435 seems likely today and commodity price strength could yet generate a retest of the August peak.
11.44am:BARTHO: Saudis pull plug on oil play
It won’t be clear until November whether the “understanding” OPEC members reached overnight actually translates into production cuts but what is apparent from the nature of the understanding is that the cartel has finally recognised that the Saudi Arabian strategy that has driven the oil price down by about 60 per cent over the past two years has been counter-productive, Stephen Bartholomeusz writes today.
At their informal meeting in Algeria, OPEC members recognised that a production cut was necessary to lift oil prices and appear to have agreed that their collective output levels need to be cut by about 700,000 barrels a day from their current levels of 33.2 million barrels a day.
What hasn’t been agreed is the detail of those cuts, and where they will fall, although it appears that the Saudis are going to have to wear the brunt of them.
Read more
11.38am:Aussie dollar hits three-week high
The Australian dollar has jumped almost 20 points against the greenback to a fresh three-week high of US77.10 cents.
Dalian iron ore futures rose 2 per cent overnight, backing up the bullish impulse generated by higher oil prices.
11.16am:Former Deutsche trader banned
Former Deutsche Bank trader Andrew Donaldson has been permanently banned from providing financial services by the corporate watchdog following a probe into conduct that saw him sacked in 2014, Daniel Palmer writes.
Mr Donaldson, who held a role in forex options and futures trading, was found to have offset trading losses with false entries to boost his reported profits.
His actions allegedly resulted in a temporary overstatement of Deutsche Bank’s internal revenue result of around €28 million ($40.8m), although no external parties were affected.
11.07am:No souring loans: Bendigo
Bendigo and Adelaide Bank chief executive has stressed the lender will not be acquiring souring Western Australian loans after buying a $1.4 billion portfolio from the state government’s low-deposit housing scheme Keystart, following an auction process where many other bidders pulled out, Michael Roddan writes.
Keystart was set up in 1989 to help low-to-medium income earners who are unable to save for a deposit or meet lending requirements of the major banks. The borrowers must meet Keystart’s “rigorous serviceability criteria” into homeownership.
Bendigo’s purchase from the state government for around 34 per cent of the $4bn total loan book is expected to be completed by early December.
10.58am:The ASX is oiling up
Oil stocks have burst higher this morning following OPEC’s surprise decision to cut production, sending the oil price soaring overnight.
BHP Billiton rocketed 3.8 per cent higher to $22.21, which is its highest level since November 6 last year and puts it on track for its best one-day gain since June 20.
Beach Energy is the best performing stock on the index as it shoots 10.8 per cent higher and pushes towards its best session since March, while Santos (+9.4 per cent), Woodside Petroleum (+6.7 per cent) and Origin Energy (+8 per cent) are all on track for their best day since June 20.
Overnight, OPEC surprisingly agreed to cut oil production in a move aimed at boosting persistently weak crude prices.
The news triggered an immediate spike of more than 5 per cent in crude prices, as markets had expected the Algiers meeting to end without agreement.
10.42am:Oz Minerals counts cost of SA storm
The severe weather conditions and consequent power outage in South Australia have forced OZ Minerals to temporarily shutter operations at its flagship Prominent Hill mine, while utility AGL Energy has talked down any threat to its profit from the event.
In a statement to the market this morning, OZ Minerals (OZL) said it was unclear when it could resume mining at Prominent Hill despite no damage being reported.
“The company has not yet received any definitive timeline as to when power will be restored to the site as suppliers determine the full extent of damage to their transmission networks,” the ASX-listed copper and gold miner said.
Daniel Palmer
Read more
10.35am:Aussie’s close above US76.75c a positive
The Australian dollar closed at US76.92c yesterday, its first daily close above the 3.5 year downtrend line at US76.75c.
A weekly close above the line is needed to confirm the break is being sustained, but AUD/USD should consolidate above 0.7675 in the absence of US dollar strength today.
Any further rise in oil or fall in the US dollar could generate a test of the September peak at 0.7730.
A break above the August peak at 0.7756 would tend to confirm AUD/USD is heading for a retest of the April peak at 0.7835.
Caixin China manufacturing PMI data at 11.45 AEST on Friday will be in focus ahead of official data over the weekend. AUD/USD last 0.7692..
10.25am:Stocks surge in early trade
The Australian sharemarket has surged in early deals as resources stocks drew a flurry of buying following a surprise OPEC oil supply cut agreement overnight, Daniel Palmer writes.
At the 10.15am (AEST) official market open, the benchmark S&P/ASX 200 index bounded 47.9 points, or 0.89 per cent, to 5,460.3, while the broader All Ordinaries index jumped 47 points, or 0.85 per cent, to 5,547.2.
Overnight, Wall Street rose as investors shrugged off an uneventful testimony from US Federal Reserve chair Janet Yellen and instead focused on a potential 2 per cent cut in oil supplies from cartel OPEC.
Unsurprisingly the nation’s biggest energy names rocketed higher in morning trade, with Santos soaring 9.4 per cent at $3.73, Origin Energy rallying 8 per cent to $5.39 and Woodside leaping 4.2 per cent to $27.63.
The oil price rally extended to base metals, which saw the materials sector also rise sharply.
Read more
10.20am:Both sides of the bank dividend debate
One of the main narratives following bank investors around this year has been when, and by how much, the mighty dividends will be cut.
Plenty, including CLSA analysts, say the “sensible thing” to do is for the banks, particularly Westpac, to drop its dividend rather than cop a potentially larger capital shortfall.
READ: Westpac should cut dividend, says broker CLSA
But what if the dividend correction isn’t as severe as widely expected? Credit Suisse equity strategists yesterday said banks are lowering their exposure to a peaking housing market and therefore dividend cuts are less likely.
With this in mind, Credit Suisse says that while banks may not be overly attractive, they make “dangerous shorts”.
“The Aussie banks currently trade on a 6.3 per cent dividend yield, which is 100 basis points higher than the long-term average,” Mr Tevfik said.
“They seem to be priced for sharp DPS [dividend per share] cuts but these are less likely if they are lowering their exposure to a peaking housing market.
“Also, as the ‘Selfies’ are filling some of the lending-void with equity, not debt, then the potential for secondary effects on the banks from a rise in defaults will be limited. While we are not big buyers of the banks (we have Westpac in our Long portfolio), we believe current valuations suggest they are dangerous shorts.”
READ: SMSFs ‘limiting housing downturn risk’
Speak of the devil
CBA’s full-year dividends are paid today, and at $2.22 per share they are the largest paid this reporting season. The payout will cost CBA almost $4 billion. Here are some graphics produced by CBA on dollars paid out per share this reporting season.
10.05am:CFO moves at Australia Inc
Changes are afoot in the CFO ranks of some of Australia’s biggest companies, with moves announced at Brambles, Cochlear and Fletcher Building this morning, Daniel Palmer writes.
Read more
9.40am:Broker rating changes
Origin Energy raised to ‘buy’ vs ‘outperform’ — CLSA
AGL Energy raised to ‘outperform’ vs ‘neutral’ — Credit Suisse
AGL Energy raised to ‘buy’ vs ‘hold’ — Citi
9.20am:Lynas narrows loss, warns on debt schedule
Struggling rare earths miner Lynas has narrowed its loss for the full year but is still bleeding enough red ink to force a renegotiation of its lending terms.
The one-time market darling reported a loss of $94.1 million for the year to June 30, a modest improvement on the prior year’s $118.6m loss.
The group warned on continued challenges to its operations that would ensure an inability to pay back its debts on the current schedule.
8.49am:Keep an eye on BHP today
Shares in the world’s biggest miner could take the spotlight this morning after OPEC cut a deal to ease production, sending the price of oil surging.
BHP Billiton’s ADRs point to a 3.6 per cent rise, with would be the miner’s biggest gain since August 8 and could take the stock to a fresh 10-month high.
BHP shares last traded 0.5 per cent weaker at $21.39, but if they jumped 3.6 per cent today they would be at their highest level since November last year.
As it stands the stock, which has a higher oil exposure than peers, has gained 19 per cent compared with 2.2 per cent from the ASX 200.
8.34am:Energy stocks look to rebound
Australian stocks look set to see a healthy rise at the open, following news of the first OPEC production cut in eight years, which lit a fire under the oil price and should flow through to energy stocks today.
The SPI 200 is pointing to a 0.8 per cent rise at the open but fair value suggests a 0.9 per cent gain is more likely.
The local market has seen six positive days in seven and a solid open today would push the index into the black for the week.
Energy stocks fell 1.2 per cent yesterday to be the worst performing sector on the ASX, but buying could resume today after the price of oil shot up overnight.
WTI crude jumped 6 per cent to $US47.38 and Brent gained 5.9 per cent to $US48.69.
Origin Energy dropped 3.7 per cent yesterday, while Santos fell 3.1 per cent.
7.39am:CBL in $NZ60m raising
CBL Insurance is tapping the market for $NZ60 million in equity, writes Bridget Carter.
The company is issuing 237 million securities at $3.45 each to fund growth.
The shares are being issued at an 8.2 per cent discount to the company’s last closing share price.
CBL was recently jointly listed on the Australian Securities Exchange and the NZX.
Bridget Carter
7.10am:Sharemarket set to open higher
The Australian market looks set to open strongly after Wall Street ended higher following an OPEC agreement to limit crude output.
At 6.45am (AEST) the share price index was up 41 points at 5,442.
Locally, in economic news today, the Australian Bureau of Statistics is due to release job vacancy data for August.
No major equities news is expected.
In Australia, the market yesterday held onto positive territory after a day of mixed results across most sectors.
The benchmark S & P/ASX200 index was up 6.5 points, or 0.12 per cent, at 5,412.4 points.
The broader All Ordinaries index was up 6.5 points, or 0.12 per cent, at 5,500.2 points.
AAP
7.05am:Dollar flat against greenback
The Australian dollar has barely changed against its US counterpart.
At 6.35am (AEST), the local unit was trading at us76.89 cents, up from US76.85 cents yesterday.
The US dollar fell against commodities-link currencies overnight after OPEC sources said major oil producers had agreed to reduce output. The greenback fell to a five-month low against crude producer but non-OPEC member Norway. But by 6.18am AEST, the US dollar had turned flat.
AAP
7.00am:Iron ore falls for third session
The iron ore price has fallen for the third straight day, even as one investment bank offers the upbeat assessment that the commodity is unlikely to drop through the $US50 a tonne threshold in the near term, Elizabeth Redman writes.
Iron ore lost 0.5 per cent to $US55.90 a tonne overnight, according to The Steel Index, from $US56.20 the previous day.
Read more
6.50am:OPEC reaches agreement on cut
The Organization of Petroleum Exporting Countries has agreed to cut production by 750,000 barrels a day, Bloomberg News reported, citing a delegation member.
The surprise news triggered an immediate spike of more than 5 per cent in crude prices, as markets had expected the Algiers meeting to end without agreement.
Dow Jones, AFP
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6.40am:Wall St rallies as oil spikes
US stocks rose overnight as the price of oil surged on the news that OPEC had agreed to a cut in crude oil production.
The gains catapulted both oil and energy companies in the S & P 500 into positive territory for the month of September.
The Dow Jones Industrial Average gained 111 points, or 0.6 per cent, to 18339. The S & P 500 gained 0.5 per cent, and the Nasdaq Composite added 0.2 per cent.
Dow Jones
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