POLITICS & POLICY

Higher oil and gas prices, the takeoff of new projects in Australia, Indonesia and Vietnam, coupled with improved weather conditions and a modification in accounting practices proved to be allies that helped advance the revenues and production output of Santos Ltd. this first quarter of 2012.

Demand by the jewellery market of China has been forecast to soar 35 per cent in the next five years as Chinese locals get to increase their financial worth with a growing disposable income.

Bell FX Currency Outlook: The Australian dollar has opened marginally lower this morning, as weaker US economic data and rumours of a possible downgrade to France's credit rating saw a cautious mood return to the market.

MORNING REPORT (7am AEST)The Philadelphia Fed survey fell from 12.5 to 8.5 in April - a three month low. Across the sub-indices, new orders and shipments both fell modestly. US weekly jobless claims fell by 2,000 last week from a upwardly revised 386,000 in the prior week.

Stocks slid for a second straight day as a trio of disappointing economic readings outweighed better-than-expected earnings reports from Travelers and others. The Dow Jones Industrial Average declined 69 points, or 0.5%, to 12964. The Standard & Poor's 500-stock index shed 8.2 points, or 0.6%, to 1377, and the Nasdaq Composite ticked down 24 points, or 0.8% to 3008.

The Australian sharemarket improved for the second straight day, with the All Ordinaries Index (XAO) edging higher by 0.3 pct or 14.1 pts to 4441.3. The dollar value of shares traded also was significantly higher than the first part of the week.

Delays will not only attend the $36-billion national broadband network (NBN) roll out but also considerable budget overshoots, reports said.

OZ Minerals, owner of the Prominent Hill copper mine project in South Australia, is eyeing potential copper and gold mining targets in Chile and Peru.

As quality mineral reserves continue to decelerate and grow thinner, spurred by the world's increasing urbanisation and technological advancements, the very miners that capitalised on these reserves will face jumping operating costs to double in the next five to ten years.

It would be appropriate for the central bank to push down the cash rate at this time, according to Prime Minister Julia Gillard, stressing that in the present situation such move would "widespread benefits for households and business."

South African miner Gold Fields has increased the initial investment on its Chucapaca gold project in Peru to $1.2 billion from $750 million, confident the gold project will receive the necessary support of nearby communities, social action groups as well as government related procedures in securing regulatory permits amid earlier misfortunes experienced by other firms of other Peruvian mining projects.

Analysts are looking forward to Australia's Prime Minister Julia Gillard's speech harping on the Reserve Bank to cut rates to prop up the domestic economy. This may lower down the pessimistic leads seen reflecting on Thursday's Australian markets beginning with the IMF's disclosure that the European debt burden will still weigh down on global markets.

Bell FX Currency Outlook: The Australian Dollar is slightly weaker this morning after a mildly negative night in offshore markets.

The Australian sharemarket rose by 1.3 pct or 58.4 pts to 4427.2 today, making it the best session in close to two months. It was also the first time that shares improved this week.

Pele Mountain Resources Inc., a Toronto-based mining firm, announced on Tuesday it has entered into a binding agreement to sell its Highland Gold projects to a wholly-owned subsidiary of Prodigy Gold Inc. for $1.8-million.

Kevin Rudd could have stayed on as prime minister, according to Fortescue Metals Group chair Andrew Forrest, who revealed Wednesday that the former Labor leader was working on acceptable revisions for the controversial resources super profits tax (RSPT).

The prospect of resounding defeat on 2013 continues to haunt the ruling Labor Party, according to the latest Newspoll survey, but key members brushed aside the ominous numbers and insisted the gloom will eventually disappear, soon.

Brazilian miner Vale SA, the world's biggest iron ore producer, has said it is open to working with state-controlled Petroleo Brasileiro SA towards a possible project cooperation on rare earths.

The Australian market reversed yesterday's losses at the open of trade this morning. At lunchtime in the East, the All Ordinaries Index (XAO) has added 49pts to 4,418 points.

Bell FX Currency Outlook: The AUD is stronger this morning, currently trading at USD1.0400, after a better than expected result for the Spanish bill auction overnight saw equity markets rise and risk appetite return to the market.

The federal government of Australia will provide a $1,000 bonus to employers that will hire people aged 50 and above to provide more employment opportunities to the older unemployed. It is in response to The Economic Potential of Senior Australians report submitted by a panel.

Aussie companies are exporting jobs to New Zealand amid high wages across the Tasman, Dominion Post reports. Woolworths, a major supermarket, is shifting 40 contact centre jobs from across the Tasman to Auckland within the week, while Imperial Tobacco has earlier said it will transfer manufacturing headquarters from Sydney to New Zealand.

MORNING REPORT (7am AEST)US factory output fell for the first time in four months, down by 0.2pct in March. US industrial output was unchanged in March after a similar result in February. For the March quarter industrial production rose at a 5.4pct annual rate, with manufacturing advancing at a 10.4pct pace. US housing starts fell 5.8pct in March to an annual rate of 654,000 units. However building permits rose 4.5pct to a 747,000 unit annual pace - the highest since September 2008.

Worldwide military expenditure increased by just 0.3 percent from 2010 to 2011, compared to annual average increases of 4.5 percent between 2001 and 2009.

Stocks rallied Tuesday as worries eased about Spain's rising borrowing costs and investors cheered a series of strong quarterly earnings reports from U.S. companies, shrugging off mixed U.S. economic data.

Aussie Home Loans (AHL) added on Wednesday to the growing call for the Reserve Bank of Australia (RBA) to cut interest rate. AHL Chairman John Symond called for at least 50 basis points reduction.

The Australian market was out of the blocks in positive fashion this morning with stocks up by close to 0.5 pct at one point only to fade away as the day progressed. In the final three or so hours of trade all the gains dissipated with the All Ordinaries Index (XAO) ending 0.3 pct or 13.7 pts lower to 4368.8. It was also another quiet session on the market today for the second consecutive day.

The technology switch embodied in the $36 billion national broadband network (NBN) could lead to significant job losses, according to giant telco Telstra Corporation.

The World Bank Board picked on Monday a non-political replacement for its outgoing chief, American Robert Zoellick, in a selection process that critics claimed lacked the transparency demanded by member nations.