The Australian share market lost early gains to close more than half a per cent lower, as investors lost confidence that Europe’s debt problems will be solved at this week’s meetings.
The S&P/ASX200 Index closed 27 points lower at 4,228. On the futures market, the SPI is down 33 points.
Economic news
The Reserve Bank of Australia has reaffirmed a possible rate cut at its next policy meeting. Deputy Governor Ric Battellino told an investment conference today this week’s consumer price index data will provide further information on whether to ease monetary policy.
And an ANZ report shows small business sales increased 5.2 per cent for the September quarter, rising for the fifth consecutive month. But year-to-year sales remained flat, increasing only 1.7 per cent.
Company news
More than 50 per cent of Pacific Brands Limited (ASX:PBG) shareholders rejected the remuneration package for the company’s management today at its AGM. The remuneration report says chief executive Sue Morphet, as well as the company's other senior managers, received short-term cash incentives despite performance targets not being met. Ms Morphet's total remuneration in 2010/11 was $2.3 million. Shares in Pacific Brands Limited (ASX:PBG) dropped 5.56 per cent today, closing at 59.5 cents.
While Qantas Airways Limited (ASX:QAN) has been suffering from striking workers and has been forced to scale back flights, Virgin Blue Holdings Limited (ASX:VBA) has announced it’s expanded its domestic capacity by five per cent in the year to date, in line with its guidance.
The airline says the growth in domestic capacity included more than 6,800 seats to Perth, and it’s flagged further increases in the near future.
Virgin also said it had grown its services to the resources sector, having already added 1,000 a week to Western Australia's Pilbara region.
Virgin Blue Holdings Limited (ASX:VBA) shares were flat at close, they were 35.5 cents.
Billabong International Limited (ASX:BBG) says its strategy of buying retail outlets is the way it’s going to increase margins. Chairman Ted Kunkel says the move by large chains to sell in-house brands has prompted the surfwear company to buy chain stores and develop and online business.
Worleyparsons Limited (ASX:WOR) has reaffirmed its guidance of improved earnings in the current financial year. The engineering firm’s chief executive John Grill says the first half results will show particular improvement. The group posted a net profit increase for the year to June 30 of $364 million from $291.1 million.
Environmental processes at Alcoa’s (ASX:AAI) coalmine in Victoria are set to strengthen when new laws are adopted on Tuesday, the Victorian government says. Alcoa will be required to submit a map of planned mine activities, potential environmental impacts, and how they’ll be managed. It’s then up to the government to approve the plans.
And Orica Limited’s (ASX:ORI) inherited Newcrest Mining’s (ASX:NCM) former chief executive Ian Smith as their own. They’ll farewell Graeme Liebelt as he retires from the role in late February after six years in the top job. Smith stood down from his role at Newcrest after five years, earlier this year.
Best and worst performers
The best performing sector was materials, up 36 points to close at 11,481. The worst performing sector was healthcare, losing 254 points to close at 7,697.
The best performing stock in the S&P/ASX200 was Mirabela, lifting 9.49 per cent to close at $1.50. Shares in Billabong and Oceanagold also finished the day stronger.
The worst performing stock was Resmed, down 13 per cent closing at $2.61. White Energy and Pacific Brands also closed lower.
Commodities
Gold is trading at $US1,658 an ounce. Light crude is up 56 cents at $US91.83 a barrel.
