The Australian unemployment rate has posted an unexpected drop to 5.3% during January beating market expectations, according to the latest figures from the Australian Bureau of Statistics.
The seasonally adjusted figures show unemployment fell by 0.2% points to 5.3%, with employment increasing overall by 52,700.
The figures also show the number of part-time employment placements increased by 36,900 to 3,314,200, while full-time employment also increased by 15,900 to 7,652,200. The participation rate remained steady at 65.3%, while aggregate monthly hours worked decreased by 1% to 1.5 billion.
Telecommunications giant Telstra has affirmed its guidance for the 2010 financial year after recording a net profit decline of 3.3% to $1.85 billion for the six months ending December 31.
Revenue also fell by 2.9% to $12.34 billion, with the company’s shares falling 2.65% to $3.30 this morning. The company said it was facing challenges, including a number of competitors in the market, the increased take-up of wireless services and a strong Australian dollar.
“In the second half of the fiscal year we believe that we will see an improvement in a number of these dynamics,” Telstra said in a statement. “However, continued domestic price competition and currency strength continue to present challenges for us.”
“These market trends are reflected in our current expectations for a low single digit decline in reported sales revenue in the business for full fiscal 2010 versus flattish previously.”
Shares flat after Wall Street decline
The Australian sharemarket has opened flat today due to mixed leads from both Wall Street and European markets, with commodity markets failing to record much ground.
The benchmark S&P/ASX200 index was up 36 points or 0.81% to 4549.8 at 12.10 AEST, while the Australian dollar has also increased up to US87c.
Commonwealth Bank shares have fallen 0.8% to $52.26, while NAB shares also rose 0.2% to $24.60. Westpac lifted 1% to $22.97 as ANZ rose 1.3% to $20.46.
Building materials group James Hardie Industries has now forecast a full-year profit at the top of market forecasts, but also warned market conditions remain uncertain.
The company recorded an 87% decline in third quarter profit to $US14.9 million for the three months ending December 31. This is compared to a profit of $US111 million in the corresponding quarter in 2008.
“Management anticipates full year operating profit excluding asbestos, ASIC expenses and costs of re-domicile to be towards the top of the current range of analysts’ forecasts,” the company said in a statement to the ASX.
“Management cautions that market conditions remain uncertain, with the current northern hemisphere winter expected to continue to be a very challenging period for the company to generate significant operating profit.”
The Federal Government has now urged China to proceed quickly with the trial of four Rio Tinto staff, who have been arrested on charges of bribery and spying.
“We would hope this matter gets resolved as quickly as possible, as we have said all the way through,” financial services minister Chris Bowen has said in a statement.
“China is a sovereign nation and has its own legal system. We’ll be working within that legal system with his representatives to ensure that he gets whatever assistance is necessary and appropriate from the government.”
Securities in property developer Charter Hall Group have been put in a trading halt ahead of an announcement on a potential acquisition deal.
“Macquarie Group notes that it is in discussions with Charter Hall regarding the potential acquisition of parts of Macquarie’s real estate funds management platform,” the company said in a statement.
CSR to appeal Federal Court ruling
CSR has said it will look to appeal the Federal Court’s decision preventing it from going ahead with its demerger plans.
The company said in a statement the ASX that in its opinion the judgement contained “errors in law which may have potentially significant ramifications for the future strategy of the company and which should not go unchallenged”.
“If leave is granted, an appeal would be the most appropriate avenue to test these legal concerns.”
Overseas, US Federal Reserve chairman Ben Bernanke has released details of how the bank will begin to move away from an expansionary policy.
“Although at present the US economy continues to require the support of highly accommodative monetary policies, at some point the Federal Reserve will need to tighten financial conditions,” Bernanke said in a speech to the House of Representatives Financial Services Committee.
On Wall Street, stocks fell due to continuing fears over the Greek economy. The Dow Jones Industrial Average fell 20.26 points or 0.20% to 10,038.38.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
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