23/09/2008 - 06:50

Today's Business Headlines

23/09/2008 - 06:50

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Relief as rally cheers investors; Seven tips profit to be cut in half; US bailout fuels relief rally; Rio aims for more ore spot-price deals; WA Libs rewarded in Turnbull shake-up

Relief as rally cheers investors
Australian shares have enjoyed their best two-day rally since the aftermath of the 1987 stockmarket crash as investors cheered the US government's $US700 billion ($840 billion) bailout of its banking system and Canberra's hastily arranged ban on short selling. The Australian

Seven tips profit to be cut in half
The fallout from the credit crisis and weak advertising is expected to slash Seven Network's first-half bottom line by up to 50 per cent, but in a further warning, the company said it was near impossible to predict what the final profit figure might be. The Australian

US bailout fuels relief rally
The US government appeared poised to extend its financial system bail out beyond US$700 billion ($840 billion) by including a wider range of troubled assets held by American and European banks, as investors assessed the implications for the global economy of the dramatic bailout efforts. The Fin Review

Rio aims for more ore spot-price deals
Mining giant Rio Tinto says annual iron ore price negotiations with its customers will become increasingly harder as it moves away from selling the valuable commodity under long-term contracts and looks to take advantage of high spot prices. The Australian

WA Libs rewarded in Turnbull shake-up
WA MPs have emerged as big winners in Malcolm Turnbull's shake-up of the Opposition front bench, winning the keys posts of shadow treasury, defence and industrial relations. The West

 

THE WEST AUSTRALIAN:

Page 1: Australian shares yesterday capped off their biggest two-day rise in more than 20 years as investors welcomed the US banking bailout and an unprecedented ban on short selling.

Page 4: The US Federal Reserve has approved the conversion of the two remaining investment titans on Wall Street, Goldman Sachs and Morgan Stanley, into bank holding companies, offering them broader government protection in exchange for tighter regulation and constraints on their once fabulously profitable businesses.

Page 5: WA MPs have emerged as big winners in Malcolm Turnbull's shake-up of the Opposition front bench, winning the keys posts of shadow treasury, defence and industrial relations.

Business: A coordinated assault on short selling and the US plan to quarantine a financial meltdown fuelled a resurgence in local stocks yesterday, but left hedge funds and traders scrambling to understand the changes.

Seven Network's controversial move to invest its spare cash on the stockmarket has backfired spectacularly, with the Kerry Stokes-owned TV broadcaster admitting the global market turmoil may slash its first-half earnings by as much as 50 per cent.

The future of renewable energy provider Natural Fuel was in doubt last night after its partner in Australia's biggest biodiesel plant withdrew funding support for the fledgling venture.

Murchison Metal's shares soared 16 per cent to $1.41 yesterday although the ban on short selling was more likely the trigger rather than investor belief that Sinosteel Corp was poised to exercise its Australian government-given right to buy a 49.9 per cent stake in the fledgling WA iron ore miner.

Liquidators will begin winding up the failed Palandri wine group's "hopelessly insolvent" managed investment schemes from today, after two of the scheme's investors who had threatened to block the move agreed to back down.

 

THE AUSTRALIAN FINANCIAL REVIEW:

Page 1: The US government appeared poised to extend its financial system bail out beyond US$700 billion ($840 billion) by including a wider range of troubled assets held by American and European banks, as investors assessed the implications for the global economy of the dramatic bailout efforts.

The blanket ban on short selling on the Australian sharemarket sent brokers, fund managers and the trading desks of major investment banks into a tailspin yesterday as they scrambled to assess the impact on their businesses.

Page 3: Big sport, art and culture sponsors are considering pulling the plug on sponsorship deals in tighter economic conditions.

 

THE AUSTRALIAN:

Page 1: Malcolm Turnbull has elevated his deputy, Julie Bishop, to the treasury portfolio and moved key Nelson backer Nick Minchin from defence.

Australian shares have enjoyed their best two-day rally since the aftermath of the 1987 stockmarket crash as investors cheered the US government's $US700 billion ($840 billion) bailout of its banking system and Canberra's hastily arranged ban on short selling.

Business: The stock market opened one hour later yesterday as the ASE experienced confusion over the surprise ban on short selling.

Japan's Mitsubishi UFJ Financial Group announced last night it had agreed to buy a stake between 10 per cent and 20 per cent in Morgan Stanley in order to establish a strategic partnership.

The fallout from the credit crisis and weak advertising is expected to slash Seven Network's first-half bottom line by up to 50 per cent, but in a further warning, the company said it was near impossible to predict what the final profit figure might be.

The fate of Lehman Brothers' operations remains clouded by controversy despite the approval by a US bankruptcy judge of the sale of the securities firm's US operations to Britain's Barclays.

Central banks may be starting to turn to one of the few assets in which they can invest: gold.

Nomura Holdings, the Japan-based securities and asset management house, has bought Lehman Brothers' entire Asian operation, including Australia.

Mining giant Rio Tinto says annual iron ore price negotiations with its customers will become increasingly harder as it moves away from selling the valuable commodity under long-term contracts and looks to take advantage of high spot prices.

 

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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