The Australian share market has ended today’s session marginally higher, shrugging off the RBA’s decision to raise interest rates for the fourth time in six months.
The S&P/ASX 200 Index finished 15 points higher at 4,702 while on the futures market, the SPI200 is up 12 points.
In economic news: The central bank has lifted the official interest rate by 25 basis points and says homeowners can expect further increases throughout 2010 as the economy continues a strong recovery. As expected by economists, the cash rate has risen to 4% from 3.75% - the highest since February 2009. RBA governor Glenn Stevens says the risk of serious economic contraction has passed and with Australia’s economy growing faster than expected, future interest rate rises will be necessary. The major banks are now reviewing their lending rates as a result of the decision.
To company news around this afternoon: Oil Search Ltd (ASX:OSH) has finalized a deal with CPC Corporation of Taiwan for a long-term supply of Liquefied Natural Gas (LNG) from the Papua New Guinea LNG joint venture. Under the agreement, the project will supply about 1.2 million tonnes per year of LNG to CPC Corporation for a period of 20 years. Oil Search’s managing director Peter Botten says the project is now fully contracted for the full plant capacity. The Papua New Guinea LNG joint venture, operated by ExxonMobil, decided to go ahead with the $13.9 billion project in December and construction is underway. First LNG sales are expected in 2014. Oil Search has a 29% interest in the project. Shares in Oil Search Ltd closed 2.29% higher at $5.36.
Gold miner Lihir Gold (ASX:LGL) has revealed plans to increase production at its mines by about 50% over the next 10 years. The company aims to produce 1.45 million ounces a year for the five years from 2012 to 2016, up from output of between 960,000 ounces and 1.06 million ounces this calendar year. Production is expected to increase to 1.5 million ounces a year for the following five years. CEO Phil Baker says the company is well advanced in expanding its Lihir Island and Bonikro mines to deliver increased production growth. A $1.04 billion plant upgrade underway at the Lihir Island operation will lift the mine’s production to over 1 million ounces per year from 2012. Shares in Lihir Gold gained 1.46% to $2.78.
Also making news: Macquarie Group Ltd (ASX:MQG) has appointed former senior Lehman Brothers executive Benoit Savoret to take charge of its operations in Europe, the Middle East and Africa. Mr Savoret will also lead Macquarie Securities in the region, covering the investment bank’s equities operations.
Qantas Airways Ltd (QAN) has announced its CFO Colin Storrie has resigned from the board for personal and health reasons. A permanent replacement for Mr Storrie is yet to be named.
Global miner Rio Tinto Ltd (ASX:RIO) says it has completed divestments in excess of $10 billion after completing the sale of the Alcan Packaging Food Americas division to Bemis Company for US$1.2 billion.
And Virgin Blue Holdings Ltd (ASX:VBA) has appointed former Qantas executive John Borghetti as CEO.
In the best and worst performers: The best performing sector at close was the Real Estate Investment Trust index, up 10 points at 884. While the worst performing sector was the Consumer Staples index; which fell 36 points to 7,787.
The best performing stock in the S&P/ ASX200 was Energy World Corp, shares gained 11.11% to $0.30. Panoramic Resources and Bluescope Steel also improved.
The worst performing stock was Tattersall’s, shares fell 7.26% to $2.30. Shares in Carnarvan Petroleum and Gunns also closed lower today.
In commodities, gold is trading at $1,117.03 U.S an ounce and light crude is down 1 cent at $78.69 U.S a barrel.
