The market is up 16 but it was up 44 at one stage. The SFE Futures were up 22 this morning.
New PM Julia Gillard has struck a deal with the mining sector (well, with BHP, RIO and Xstrata) over the RSPT. The Resources Super Profits Tax has been renamed the Minerals Resources Rent Tax. The new reform will come into effect on July 1, 2012 and will now only apply to the value of the resource rather than the valued added by the miners. The headline rate was cut to 30% from 40%. All in all, it means $1.5bn less revenue for the government which they will make up by reducing the company tax rate to 29% instead of 28%. BHP up 31c to 3742c, RIO up 89c to 6599c and FMG up 10c to 410c. See below for more on the MRRT.
Wall St. closed down 41. The Dow was up 21 at best and down 152 at worst. The S&P 500 is now down eight of the last nine sessions. At 14.9x the PE on the S&P 500 (assuming the “E” is accurate) is the lowest in a year. The US unemployment figures are out tonight. Oil fell $3.38 to $72.25, Gold fell $39.40 to $1206.50 and the $A has jumped on the back of the revised MRRT — now just under 85c compared to 83.16c at its low yesterday.
In other news today…
- Downer EDI (DOW) have provided an update on Reliance Rail. They confirm that the Waratah arrangements remain in place and reiterate they have no intention of raising equity. DOW down 26% in the past month but is up 5% today to 359c.
- Fairfax Media (FXJ) has extended a $292m bank facility for three years and cut their total bank facility to $1.1bn from $1.2bn. FXJ down 1c to 134c.
- Harvey Norman (HVN) announced they will acquire around $55m worth of certain stock, plant and equipment from Clive Peeters. HVN unchanged at 340c.
- Paladin (PDN) has announced a few board changes. PDN up 3c to 346c.
- Westpac Bank (WBC) says BT Investment Management will pay a fully franked special dividend of 12.5c instead of a one-off capital return of the same value because of changes to the Corporations Act. WBC up 2.3% to 2131c.
- Commonwealth Bank (CBA) will face a class action from investors who lost their savings in the collapse of Storm Financial. CBA up 16c to 4764c.
- Origin Energy (ORG) says the Darling Downs Power Station completes final commissioning. ORG up 1.5% to 1484c. Aquila Resources (AQA) are eyeing off using RIO’s Robe Railway in WA now that the Competition Tribunal has opened up access to it. AQA up 1c to 759c.
- Stocks hitting fresh 52 week lows include: Biota Holdings (BTA), Cooper Energy (COE) and Magma Metals (MMW).
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