Author: roymorgansocial

Rio wears cash drain to bet on copper

roymorgansocial Leave a comment

Original article by Peter Ker
The Australian Financial Review – Page: 19 : 5-Dec-19

Rio Tinto will extend the life of its Kennecott copper mine in the US until at least 2032 after unveiling plans to spend $US1.5bn on a new pit wall cutback. Rio Tinto is also widely tipped to spend some $US1.5bn on the expansion of its Oyu Tolgoi copper mine in Mongolia in 2020. The capital investment programs have raised doubts as to whether Rio Tinto’s copper and diamonds division will generate free cash flow in 2020. Copper and diamonds have accounted for the bulk of its expenditure on exploration in 2019.

CORPORATES
RIO TINTO LIMITED – ASX RIO, BHP GROUP LIMITED – ASX BHP

Retail investors turn on director Marriott

roymorgansocial Leave a comment

Original article by Aleks Vickovich
The Australian Financial Review – Page: 17 : 5-Dec-19

Westpac’s money-laundering scandal is set to dominate its AGM on 12 December. The Australian Shareholders’ Association has signalled its intention to vote against the remuneration report and the re-election of Westpac director Peter Marriott. However, it will support the re-election of Nerida Caesar, Steve Harker and Margaret Seale. The Australian Council of Superannuation Investors has indicated that it will vote in favour of Marriott’s re-election. Some 64.2 per cent of votes cast at Westpac’s 2018 AGM rejected its remuneration report.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIAN SHAREHOLDERS’ ASSOCIATION, AUSTRALIAN COUNCIL OF SUPERANNUATION INVESTORS INCORPORATED, LEGG MASON ASSET MANAGEMENT AUSTRALIA LIMITED, MARTIN CURRIE INVESTMENT MANAGEMENT LIMITED

Investment strike keeps growth low

roymorgansocial Leave a comment

Original article by Glenda Korporaal
The Australian – Page: 17 & 27 : 5-Dec-19

Commonwealth Bank economist Michael Blythe says the latest GDP data shows that Australia has a two-speed economy, with private sector spending down 0.1 per cent in the September quarter and 0.3 per cent year-on-year, while public sector spending increased by 1.1 per cent and 4.8 per cent respectively. Master Builders Australia has urged the federal government to fast-track smaller infrastructure projects, with chief economist Shane Garrett noting that businesses and consumers lack the confidence to spend at present.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, MASTER BUILDERS AUSTRALIA INCORPORATED, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, AUSTRALIAN BUREAU OF STATISTICS, RESERVE BANK OF AUSTRALIA, BUSINESS COUNCIL OF AUSTRALIA, WAGNERS HOLDING COMPANY LIMITED – ASX WGN

Banks braced for RBNZ’s capital D-Day

roymorgansocial Leave a comment

Original article by James Eyers
The Australian Financial Review – Page: 13 & 16 : 5-Dec-19

The Reserve Bank of New Zealand will announce its new tier-1 capital requirements for Australian banks’ NZ subsidiaries on 5 December. Cameron Bagrie from Bagrie Economics expects the central bank to push ahead with its previously flagged plan to increase minimum capital ratios to 16 per cent, despite warnings from banks that this is excessive. It is estimated that Australian banks would need to hold about $18bn worth of additional capital in New Zealand, which may reduce both their profits and dividends in Australia.

CORPORATES
RESERVE BANK OF NEW ZEALAND, BAGRIE ECONOMICS, EVANS AND PARTNERS PTY LTD, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, NEW ZEALAND BANKERS’ ASSOCIATION

Australia dodges US tariff blitz

roymorgansocial Leave a comment

Original article by Jacob Greber
The Australian Financial Review – Page: 11 : 4-Dec-19

US President Donald Trump has accused Brazil and Argentina of deliberately devaluing their currencies. He has retaliated by removing a tariff exemption on steel and aluminium imports from the two nations. Australian imports will continue to be subject to the tariff exemption; local aluminium producers have significantly cut their shipment to the US since May, when concerns were raised within the Trump administration about a sharp rise in export volumes. Trump has also flagged tariffs on imports from France in response to the nation’s digital services tax.

CORPORATES
UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT

Climate plan no barrier to trade deal

roymorgansocial Leave a comment

Original article by Ben Packham
The Australian – Page: 4 : 4-Dec-19

Trade Minister Simon Birmingham says the federal government will seek a free-trade agreement with the European Union that is in Australia’s best interests overall. The EU’s ambassador to Australia, Michael Pulch, has indicated that Australia’s climate change policies will not affect negotiations for a free-trade deal. Paris Agreement signatories will review their carbon emissions reduction commitments in 2023, and Pulch hopes Australia will use this opportunity to increase its reduction targets.

CORPORATES
AUSTRALIA. DEPT OF FOREIGN AFFAIRS AND TRADE

Coalition manoeuvres to keep union bill alive

roymorgansocial Leave a comment

Original article by Phillip Coorey
The Australian Financial Review – Page: 4 : 4-Dec-19

The federal government will reintroduce the Ensuring Integrity Bill to the lower house on 4 December, after it was recently voted down in the Senate. The bill includes the amendments that were requested by Centre Alliance and One Nation, and Industrial Relations Minister Christian Porter has indicated that the government may be open to further changes in order to secure the bill’s support in the Senate. Porter has rejected suggestions that the bill would enable unions to be deregistered for minor breaches of workplace laws, such as administrative errors.

CORPORATES
AUSTRALIA. DEPT OF EMPLOYMENT, SKILLS, SMALL AND FAMILY BUSINESS, CENTRE ALLIANCE, ONE NATION PARTY, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY

Low interest rates aren’t enough to boost wages growth: Economists

roymorgansocial Leave a comment

Original article by Euan Black
The New Daily – Page: Online : 4-Dec-19

With official interest rates left unchanged at 0.75 per cent on 3 December, some economists contend that further rate cuts are necessary for the Reserve Bank to deliver on its employment and inflation targets. However, others argue that interest rates are already so low that further cuts will not do not much to stimulate the economy. Instead, they contend that wage increases are needed, and this in turn requires measures to boost labour productivity. Growth in productivity has averaged 1.1 per cent annually over the last five years, and Treasurer Josh Frydenberg has estimated that lifting it to 1.5 per cent would boost incomes by $3,000 a year.

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIA. DEPT OF THE TREASURY

Woodside moves forward on $6b Senegal oil project

roymorgansocial Leave a comment

Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 18 : 4-Dec-19

The partners in the Sangomar joint venture have lodged a development plan for the offshore oil project with the Senegal government. The plan was submitted shortly before their licence was due to expire on 4 December. Woodside Petroleum and its partners in the $6bn project propose to undertake a phased development of the oil field, with production slated to commence in 2023. The project has been marred by a dispute between Woodside and junior partner FAR Limited over the former’s acquisition of ConocoPhillips’ stake.

CORPORATES
WOODSIDE PARK STUD PTY LTD, FAR LIMITED – ASX FAR, CONOCOPHILLIPS, PETROSEN

Construction the drag on productivity

roymorgansocial Leave a comment

Original article by David Marin-Guzman, Matthew Cranston
The Australian Financial Review – Page: 6 : 4-Dec-19

The Reserve Bank of Australia’s analysis shows that the construction sector was the biggest contributor to the decline in the nation’s labour productivity in 2018-19. The central bank’s Statement on Monetary Policy notes that this may be due to construction firms retaining idled workers in the hope that the residential development sector will rebound. However, the RBA’s analysis could weaken the CFMMEU’s recent proposal for annual pay rises of five per cent for New South Wales building workers.

CORPORATES
RESERVE BANK OF AUSTRALIA, CONSTRUCTION, FORESTRY, MARITIME, MINING AND ENERGY UNION OF AUSTRALIA, MASTER BUILDERS AUSTRALIA INCORPORATED, AUSTRALIAN BUREAU OF STATISTICS