The local share market has made a welcome comeback to close on a high today, as investors were lured back into the market after recent big falls. Mining stocks led the gains after Rio Tinto and BHP Billiton flagged sharp increases in iron ore prices.
The S&P/ASX 200 Index finished the day 55 points stronger at 4,381. While on the futures market, the SPI200’s also up 55.
In economic news: Handing down the NSW budget today, Treasurer Eric Roozendaal announced that the state economy is back in the black, with a surplus of $101 million for the 2009 financial year. The centerpiece of the budget is that for the next two years from July 1, stamp duty will be cut to zero for over 65s and people buying a home or unit off the plan worth under $600,000. The Queensland government also handed down its budget today, flagging jobs growth of 2.75% for fiscal 2011 and an earlier return to surplus.
To company news around this afternoon: Valemus Ltd, the Australian arm of German construction group Bilfinger Berger hopes to raise $1.39 billion in the country’s largest IPO in eight months. Valemus, whose projects include the Sydney Opera House and the city’s Anzac Bridge, plans to sell 555 million shares to individual and institutional investors for between $2.20 and $2.50 each. The listing on the Australian Securities Exchange is set for next month and would be the country’s biggest since Myer Holdings Ltd (ASX:MYR) IPO in November. Valemus chairman Nick Greiner says three or four potential Australian and overseas trade buyers had expressed interest in the company since the IPO was first flagged late last year, but Bilfinger decided to pursue the float plan.
Qantas Airways Ltd (ASX:QAN) and Virgin Atlantic Airways Ltd have revealed that they are open to merger opportunities as they struggle to boost traffic numbers. Bloomberg reports that Qantas chief Alan Joyce says the airline would be a great asset to anyone and favours an intercontinental deal. Virgin Atlantic CEO Steve Ridgway says the carrier is also exploring its options as US and European mergers squeeze its position in the North Atlantic market. Qantas held merger talks with British Airways in 2008, but they were called off after the pair failed to agree on how to split ownership. Shares in Qantas closed 2.03% higher at $2.51.
Also making news: Agribusiness firm Elders Ltd (ASX:ELD) says it has not been able to finalise bank finance from the Rural Bank for potential investors in the Elders Forestry 2010 Management Investment Scheme project.
There are reports that Australia’s largest brewer, Foster’s Group Ltd (ASX:FGL), may receive bids for its newly separate beer and wine divisions from China’s Bright Food Group Co. and Tsingtao Brewery Co. Foster’s has declined to comment on the reports.
Karoon Gas Australia Ltd (ASX:KAR) says it is considering the potential listing of its Brazilian and Peruvian assets.
And US hospital operator Tenet Healthcare has pulled out of the bidding race for Aussie private hospital operator Healthscope Ltd (ASX:HSP).
In the best and worst performers: The best performing sector at close was the Telco Services index, up 21 points at 1,051. The worst performer was the Real Estate Investment Trust index, still up a point at 851.
The best performing stock in the S&P/ ASX200 was St Barbara, shares rose 15.25% to $0.34, while shares in Gunns and Avoca Resources also closed higher.
The worst performing was Isoft Group, shares fell 12.5% to close at $0.28. Shares in Elders and Sundance Resources also closed weaker today.
In commodities, gold is trading at $1,237.85 U.S an ounce, and light crude is up $0.51 at $71.95 U.S a barrel.
