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Markets jumping at shadows

THE Australian share market opened on Tuesday spooked by news of another passenger plane crash in NewYork. With suspected terrorist attacks still dominating news services, and with Osama Bin Laden volunteering information on his nuclear arsenal, world stock markets can still be vulnerable to shadow jumping.

The Australian share market is relatively strong, with the market relieved to have the election out of the way and focusing on specific sectors. At present, the share market is concentrating on stocks that will be re-weighted on the Morgan Stanley Capital Index (MSCI) by the end of November.

The main beneficiaries of any re-weighting will be ANZ, BHP-Billiton, Westfield Trust, Macquarie Infrastructure Group and Woodside Petroleum. BHP-Billiton is to be re-weighted based on the successful merger completed recently, the merged entity creates a much larger company and will be re-weighted accordingly.

ANZ has benefited in the past with MSCI indexing, and will again benefit with it being the biggest Australian beneficiary, ranking 12th out of 1650 stocks globally. ANZ is expected to constitute 2.9 per cent of the MSCI Australia Index and is the largest new inclusion.

BHP-Billiton plc will be the second biggest Australian beneficiary to be included for the first time in the MSCI UK index. BHP-Billiton plc will be ranked 13th out of 1650 stocks. At present, BHP Ltd is currently ranked 224th.

Telstra is the biggest Australian loser, ranking an estimated 1635 out of 1650 stocks, with most other global telcos below it. These weighting changes will be co-ordinated before the end of November.

Psivida Limited

Psivida Limited (PSD) is a Perth-based Biotech company that holds a 40 per cent interest in UK based pSiMedica. PSiMedica is a company attempting to commercialise research on silicon technology that can be used not just as a semiconductor, but also in the medical sense as a “biomaterial”. In essence, the researchers have found that “porous” silicon can be biocompatible and biodegradable.

This means that instead of shielding a silicon-based device from body tissues and the bloodstream, as has previously been the case, it is now possible to construct silicon based devices that are genuinely “bioactive”. The chip device could be designed to interact actively with living tissues in order to elicit some desirable physiological response.

Psivida Limited also has a collaboration with PowderJect plc (UK Listed) on needle-less injection drug delivery. Powderject is the world’s sixth-largest vaccine company, and the company’s powder injection system painlessly delivers minute amounts of “powder-form” medicine into the outer layer of skin. Powderject is researching the use of BioSilicon as a replacement for drug coated gold particles currently used in its needle-less injection system.

The current situation at Peptech Ltd, where the shares hit an all-time high of $4.48 recently, is the result of watertight patent technology. Dr Roger Aston, a biotechnology guru with more than 20 years’ experience in the pharmaceutical and biotechnology industries, was the architect of these patents.

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