Rio Tinto's shares surged over 10 per cent at the start of trade in response to its plans to slash 14,000 jobs, cut spending and costs and sell assets due to the global economic crisis.
At 1009 AEDT, the stock was trading $3.95 or 10.56 per cent higher at $41.35. The stock closed at $40, up 7 per cent.
Yesterday, the miner announced that it will axe jobs and cut 2009 capital spend from $9 billion to $4 billion.
It will also increase its asset sales in order to reduce its $39 billion debt, incurred from its Alcan acquisition, by $10 billion.
Rio also noted that some projects will be deferred or cancelled, with each operation to be assessed individually.
Meantime, the federal government will make sure that workers who lose their jobs at Rio will get their full entitlements, Deputy Prime Minister Julia Gillard says.
"This is certainly bad news and for any Australian facing a job loss is very, very tough news, particularly in the run-up to Christmas," Ms Gillard told the Fairfax Radio Network.
"We will be talking to Rio Tinto, making sure that people get their entitlements."
The government would make available training places for people who lost their jobs.
"While many businesses are facing problems in the global financial crisis, and Rio Tinto has certainly said that its problem flowed from the global financial crisis, there are other employers who still want skilled labour," she said.
"One of the things we want to make sure is that there is training available to get people those vital skills that are in demand."
