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The Border Watch : October 22nd 2013
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8 - The Border Watch, Tuesday, October 22, 2013 MELBOURNE: The Australian share market has closed at a new five-and-a-half-year high, after US and European markets lifted at the end of last week as US government services were reopened. IG market strategist Evan Lucas said the Australian market had taken its lead from stronger markets in the US. Investors were no longer facing a wall of worry now that the US had at least temporarily resolved its budget and debt ceiling impasse, and China's economic growth was accelerating. "This is basically following on from what we saw over in the US on Friday night," Mr Lucas said. He Lucas said investors were focusing on Westpac, ANZ and National Australia Bank which would soon be reporting their annual financial results. "They are three of the top five companies on the ASX (Australian Securities Exchange)," he said. "They do tend to rally quite hard before their results. That will probably be a fairly big driver of our market over the next week." Mr Lucas said US economic data that was prevented from publication because of the US government shutdown would be released this week and would also influence the Australian market. The US non-farm payroll and jobless figures for September, which will be released tonight, would be the key data. AAP Market hits five-and-a-half-year high Erica moving on, but stays a Packer SYDNEY: Inflation is expected to be below the Reserve Bank of Australia's two to three per cent target range, but likely won't prompt an interest rate cut. The consumer price index, the key measure of inflation, is forecast to have risen by 0.8 per cent in the three months to September, for an annual rate of 1.8 per cent, an AAP survey of 11 economists shows. This follows low June quarter CPI, of 0.4 per cent, and its annual rate of 2.4 per cent. The Australian Bureau of Statistics will release the inflation figures tomorrow. JP Morgan Australia chief economist Stephen Walters said a high exchange rate and below average economic growth is keeping inflation low despite higher petrol prices giving the headline CPI a bit of a boost. "Fundamentally, there are few forces that would argue for a rapid acceleration in consumer prices," he said. "GDP (gross domestic product) growth has been tracking below trend for around a year, and this should continue well into 2014. "Only a weaker currency will add any sort of inflation impulse, although it probably is too soon to see this in the data." The low inflation rate is unlikely to give the RBA scope to further reduce its cash rate this year, or at all. In the past two years, the central bank has cut the rate to a record low of 2.5 per cent, in instalments from 4.75 per cent in November 2011. In the past weeks, improving business and consumer confidence has caused some economists to push out their forecast for the next rate cut to next year, although most now say the RBA's rate cutting has ended. National Australia Bank has pushed out its forecast for a cut from November to February which, it says, will be the last. "It's hard to see the RBA cutting rates given improving confidence and house price gains," Senior economist David de Garis said. "Unless data turns this thesis on its head in coming weeks, November and December are shaping up as on-hold months." AAP All states to get post poll lift CANBERRA: Western Australia remains the top performer but the fortunes of all the states and territories are expected to improve, following the election of a new federal government. Commonwealth Securities' quarterly State of States report says there's been no slippage in WA's No.1 ranking and the ACT continues to hold the second spot. But there is now little separating the Northern Territory, Queensland, NSW and Victoria, before a gap to South Australia and a further gap to Tasmania, which lags on all economic criteria. Jobless rate set to rise to about 6% SYDNEY: Australia's unemployment rate is set to rise to about 6 per cent by early 2014, according to research into the state of the jobs market. According to the Clarius Skills Indicator, which tracks the availability of skilled labour, there was oversupply of 134,000 jobseekers in September, meaning there were more people seeking jobs than positions to be filled. The indicator found the oversupply of workers extended to most industries, including engineering which has been hit by a mining slowdown. Ramsay has eye on France MELBOURNE: Private hospitals operator Ramsay Health Care is seeking to expand its portfolio of hospitals in France, with another acquisition under negotiation. Ramsay said yesterday its French subsidiary, Ramsay Sante, was in exclusive talks with the Generale de Sante Group with a view to acquiring Medipsy, which has the largest number of psychiatric clinics in France. Medipsy has 27 general mental health clinics -- one is under construction -- plus three that specialise in drug and alcohol addiction. Fast food, fitness firms to be audited BRISBANE: Fast food and fitness firms are generating a higher number of complaints from franchisees and will be audited, the competition regulator says. Australian Competition and Consumer Commission deputy chair Michael Schaper told a national franchise convention it would target industries that generated a disproportionate number of complaints. During the last financial year, the ACCC received 740 complaints from people involved in franchising, with many of them related to misleading conduct and false representations about potential earnings. BUSINESS IN BRIEF Inflation weak, but cut unlikely Little scope with improving confidence and house price gains Split: James and Erica Packer are separating after six years of marriage. Picture: AAP Business confidence reaches 3-year high CANBERRA: A key business lobby group is concerned about the employment outlook even though the change of federal government has improved overall confidence. The Australian Chamber of Commerce and Industry's latest survey of investor confidence has found business owners at their most confident since December 2010. "We are continuing to see this improvement in expectations flying from a new government and a new administration with different economic agenda," chamber chief economist Greg Evans said. However, improvement in actual trading conditions was more modest. Expectations for sales, profitability and the investment outlook all grew in the month but expectations for employment deteriorated. The survey's expectation index rose to 59.2 points in the September quarter from 55.7 points in the previous three months, while the actual conditions index crept up to 50.8 points from 49.9 points. Even so, this was the first time the conditions index had risen above the key 50-point mark, which separates expansion from contraction, since March 2011. AAP "Only a weaker currency will add any sort of inflation impulse" -- Economist Stephen Walters Looking good: The ASX. Spending falls in September SYDNEY: Spending fell for the first time in 13 months in September, but consumer confidence is expected to pick up in following months. Economywide spending was down 1.4 per cent in September, seasonally adjusted, according to the Commonwealth Bank's Business Sales Indicator, after a 2.5 per cent rise in August. The annual growth rate eased to 5.3 per cent in September, from 12 per cent the month before. CommSec chief economist Craig James said the fall in spending coincided with a boost in housing data. AAP SYDNEY: Erica Packer has briefly talked about the breakdown of her marriage to media and gaming mogul James Packer, and why she is keeping her surname for now. The model and mother of three has given her first interview since her high-profile split from the billionaire businessman. She has told Vogue Australia magazine that she is focused on moving forward and remaining on good terms with her estranged husband for the sake of their children. "The actions we take now, the way we behave, will affect three little innocent people for the rest of their lives," she says in the November issue of the magazine. She says she remains close to James's mother Ros and sister Gretel. "They are strong, they are there for me, and we are all in regular contact. We are, and remain, a family." She says she won't revert to her maiden surname of Baxter, adding her husband wants her to keep the Packer surname. "I don't want to be all about a name," she says. "In the greater scheme of things it doesn't really matter." The photoshoot was conducted before news of the break-up emerged and was to publicise Packer's work with UNICEF. Packer laughed off rumours romantically linking her to Russell Crowe, after photographs of her and the Oscar-winning actor together in Beverly Hills were published in an Australian magazine. "That is just ridiculous," Packer said when asked about her relationship with Crowe. "Those photos were taken months ago and Russell is a close friend of mine and James's ..." she said. AAP
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