Original article by Simon Benson, Patrick Commins
The Australian – Page: 1 & 6 : 10-Mar-20
Cabinet’s expenditure review committee is set to approve the federal government’s economic stimulus package within days. Prime Minister Scott Morrison will use a speech on 10 March to argue that the stimulus must be targeted and position both the domestic economy and the federal budget to rebound when the coronavirus crisis is over. He will also urge large companies to support their employees, customers and suppliers, and to ensure that small businesses are paid promptly. National Australia Bank’s chief economist Alan Oster says the package must be worth at least $10bn and should include measures such as a business investment allowance and income tax cuts.
AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB
Original article by William McInnes
The Australian Financial Review – Page: 33 : 10-Mar-20
The Australian dollar fell by 4.6 per cent to an intra-day low of $US0.6312 during a 20-minute period in local trading on 9 March. It was the currency’s lowest level since early March 2009, as growing concern about the coronavirus weighed on financial markets. Sean Callow of Westpac says the sell-off appears to have been driven by Japanese investors exiting their Australian dollar positions, with the ‘flash crash’ coinciding with a rally in the yen against the greenback. The Australian dollar rebounded to around $US0.6550 late in the local trading session.
WESTPAC BANKING CORPORATION – ASX WBC
Original article by Matthew Cranston
The Australian Financial Review – Page: 4 : 10-Mar-20
Deutsche Bank economist Phil O’Donaghoe does not expect quantitative easing to be necessary in response to the coronavirus. He says another official interest rate cut in April and the federal government’s stimulus package should result in a 2019-20 Budget deficit of about 1.2 per cent of GDP. However, O’Donaghoe warns that if the Reserve Bank of Australia does resort to quantitative easing, it would need to purchase up to $30bn worth of bonds to generate the same macroeconomic stimulus as a rate cut of 25 basis points.
RESERVE BANK OF AUSTRALIA, DEUTSCHE BANK AG
Original article by David Rogers
The Australian – Page: 29 : 6-Mar-20
Investors have responded positively to the announcement of economic stimulus measures in Australia and the US in response to the coronavirus. Wall Street and sharemarkets across the Asia-Pacific region rallied on 5 March, while the yield on 10-year Australian government bonds rose six basis points to 0.78 per cent. Meanwhile, financial markets expect further official interest rate cuts in both Australia and the US in coming months.
STANDARD AND POOR’S ASX 200 INDEX, STANDARD AND POOR’S 500 INDEX, SHANGHAI COMPOSITE INDEX, NIKKEI 225 INDEX, HANG SENG INDEX, KOSPI INDEX, TAIEX INDEX
Original article by Phillip Coorey, Matthew Cranston
The Australian Financial Review – Page: 1 & 6 : 6-Mar-20
Treasury expects the impact of the coronavirus to reduce economic growth by at least 0.5 per cent in the March quarter, while the recent bushfires will cut growth by a further 0.2 per cent. The federal government’s stimulus package will aim to prevent economic growth from also being negative in the June quarter; it will include wage subsidies, a business investment allowance and tax breaks to assist with cash flow. Greens leader Adam Bandt says the stimulus package should also include an increase in unemployment benefits and financial assistance for workers who are not entitled to paid sick leave.
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIAN GREENS, AUSTRALIAN LABOR PARTY
Original article by Melissa Yeo
The Australian – Page: 27 : 6-Mar-20
Matthew Ross of Goldman Sachs says the coronavirus outbreak is likely to prompt more listed companies to undertake capital raisings in coming months, particularly ones that are close to breaching their debt covenants. Ross notes that the supply chains of many companies will be impacted by the virus, given the high level of dependence on imports from China, especially in the consumer goods sector.
GOLDMAN SACHS AUSTRALIA PTY LTD
Original article by Phillip Coorey, John Kehoe
The Australian Financial Review – Page: 1 & 6 : 5-Mar-20
Finance Minister Mathias Cormann has warned that the coronavirus will have a "material impact" on Australia’s economic growth in the first half of 2020. Amid growing concern that the nation could go into recession for the first time since 1990-91, the federal government is set to announce a stimulus package that will hit the Budget bottom line. The package will focus on jobs, small business cash flow and capital investment; it is expected to include a business investment allowance that was to have been announced in the May Budget. The stimulus package is likely to result in a deficit for 2019-20.
AUSTRALIA. DEPT OF FINANCE
Original article by Brad Thompson
The Australian Financial Review – Page: 22 : 5-Mar-20
Fortescue Metals Group has asked all employees who have travelled overseas to remain at home for 14 days before returning to work. One employee was quarantined at the Christmas Creek iron ore mine after reporting flu-like symptoms following a trip to Bali, and Fortescue has confirmed that they have tested negative for the virus. BHP and Rio Tinto are also actively taking measures to protect their workforces from the coronavirus at their iron ore mines.
FORTESCUE METALS GROUP LIMITED – ASX FMG, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO
Original article by Yoni Bashan
The Australian – Page: 1 & 7 : 5-Mar-20
The global death toll from the coronavirus has risen to 3,252, with Australia recording its second fatality. NSW Health has confirmed that a 95-year-old woman who died on 4 March has tested positive for the virus. More than 95,000 people worldwide have now been diagnosed with the coronavirus, including 52 in Australia. Meanwhile, NSW Health Minister Brad Hazzard has criticised the "convoluted" process for securing emergency funding from the federal government, after NSW Health was forced to provide staff to an aged-care home whose employees failed to turn up for work following a coronavirus outbreak at the facility. The deceased woman was a resident of the aged-care home.
NEW SOUTH WALES. MINISTRY OF HEALTH
Original article by Simon Evans, Peter Ker
The Australian Financial Review – Page: 16 : 3-Mar-20
There are reports of growing stockpiles of steel in China, which accounts for around half of the world’s production. Stockpiles have increased because construction companies and other steel users in China have been in partial shutdown due to the coronavirus, and the growing stockpiles have sparked concern of a knock-on effect to Australian iron ore miners such as Fortescue Metals Group and BHP. However, Fortescue CEO Elizabeth Gaines says the coronavirus has not impacted on its shipping schedule at this stage, while she notes that Chinese steel mills are still operating.
FORTESCUE METALS GROUP LIMITED – ASX FMG, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, BLUESCOPE STEEL LIMITED – ASX BSL