Aussie shares are higher at midday investors welcoming news that the mining industry and the federal government have reached a compromise on the controversial mining tax.
Resource stocks like the top miners BHP and Rio Tinto led the gains saying they are encouraged by the outcome of talks with the government and are pleased with the new resources tax.
The S&P/ASX200 index is 19 points higher at 4,256 and on the futures market, the SPI200’s up 26.
In company news: According to a Reuters report, iron ore miner Atlas Iron Ltd (ASX:AGO) is not happy with government’s new mining tax saying it will hurt smaller companies trying to expand their operations. Reuters reports Managing Director, David Flanagan saying that if smaller mining companies are going to be hit by a higher tax then they will have less to invest in growing their business. Many junior miners are angry at the lack of inclusion in consultations between the mining industry and the government. Shares in Atlas Iron rose 2.9% to $2.13.
And to more on the mining tax now, Swiss giant Xstrata says it will resume its planned expansion of the Ernest Henry copper mine in far north Queensland following the revised tax regime announced by new PM Julia Gillard today. When news of the proposed tax under the Rudd government first came to light, Xstrata suspended its planned $400 million expansion of the Ernest Henry mine. The Swiss giant also halted close to a further $200 million worth of expansion work planned for some of its other Australian operations. Now that a favourable outcome on the tax has been reached, Xstrata says work on Ernest Henry will commence again.
Turning now to market indices: The best performing sector at midday is the Industrials index, up 60 points to 3,200. Shares in Downer EDI are 8.19% higher at $3.70. Shares in Mermaid Marine Australia and MAp Group at noon.
The sector with the biggest loss at midday is the Telco Services index, down 8 points to 1,066. Shares in Amcom Telecom dropped 3.33% to $0.29. Shares in Telstra are lower, while shares in Hutchison Telecommunications are flat at noon.
Looking to New Zealand and the NZSX50 is 6 points higher. Taking a look at the top 4 stocks by turnover: Top of the list is Telecom of New Zealand with stock steady at $1.83 followed by; Skellerup Holdings, Fletcher Building and Westpac.
To gold and the dollar: Gold is trading at US$1,207.20 an ounce and the Aussie dollar is trading at 85.02 US cents.
