POLITICS & POLICY

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.

After a long and arduous battery of routine inspections, not to mention many power failures and blackouts, Japan is ready to resume using nuclear energy after Japanese Prime Minister Yoshihiko Noda last week declared that two reactors were already safe to reactivate and operate after having passed undergoing computerized "stress tests".

With only 54 of its nuclear plants working, Japan's crude oil, heavy fuel oil and liquefied natural gas (LNG) consumption had surged in the last fiscal year ending March 31.

Australian troops will be out of Afghanistan by 2013, according to the prepared speech that Prime Minister Julia Gillard is set to deliver on Tuesday, but the country remains committed to the overall cause of preserving the democratic government in the war-torn nation.

The Australian share market lost ground yesterday, with the All Ordinaries Index (XAO) closing down 22 points to 4,382 points. Overnight the US markets ended mixed and European markets closed slightly higher. Concerns over Spanish debt and growth prospects and mixed economic data out of the Unitied States held back the tech heavy NASDAQ and lead to low volumes being traded out European markets.

If you happen to need even more evidence that President Obama has gutted his campaign promises and betrayed not only the left but also African Americans who enthusiastically supported his election, he has just gone public with his support for the continued war on drugs.

The New Zealand Embassy was hit when Taliban insurgents on Sunday launched violent attacks on several sites in Kabul, Afghanistan. Insurgents fired grenades and automatic weapons in a series of attacks in the country’s capital, and it has been described by foreign media as one of the most serious in years.

The Dow Jones Industrial Average rose amid better-than-expected retail sales data, while Apple shares' biggest drop since October pulled other major benchmarks into the red. The Dow bounced from its biggest weekly slide of the year to rise 71.82 points, or 0.6%, to 12921.41.

Bell FX Currency Outlook: The Australian Dollar is trading relatively unchanged this morning from yesterday's levels following a choppy night of trading with equities mixed, US Treasuries little changed and upward pressure on European bond yields.

MORNING REPORT (7am AEST)US retail sales rose by a larger than expected 0.8pct in March after rising by 1.0pct in February. Forecasts centred on 0.3pct growth. Excluding autos and gasoline sales rose by 0.7pct.

The Australian sharemarket lost ground for the first time in three sessions, with the All Ordinaries Index (XAO) down 0.5 pct or 21.7 pts to 4382.5. All sectors ended in the red with the exception of the telcos, with Telstra (TLS) up 0.3 pct or 1 cent to $3.37.

Opposition lawmakers have called on Prime Minister Julia Gillard to apply pressure on embattled Labor MP Craig Thomson to cooperate with all police inquiries that seek to shed light on the alleged corruption that marred the Health Services Union (HSU) operations under his watch.

A recent survey into the Pogo Mine, a large gold mine located in Interior Alaska, has yielded a new discovery of at least 1.2 million ounces of gold.

Australian banker Westpac Bank, the country's second largest by market capitalisation, has been granted a license by the Indian central bank to set up a branch in the region.

China is calling on New Zealand to provide a policy environment that will create a fast track for Chinese investment, according to China's fourth-ranked leader, Jia Qinglin, who made the remark in a contribution to the New Zealand Herald.

Trade Minister Tim Groser says New Zealand must strengthen economic ties with Indonesia, New Zealand Herald reports. Even as Mr Groser acknowledged "some problems" within Indonesia, he stressed Indonesia was a fully democratic state and hinted New Zealand should look closely into opportunities with the fast-developing Southeast Asian nation.

The Coalition says Australian banks were merely laying out policies that would shield their profit margins as Australia & New Zealand Banking Group (ANZ) decided on Friday last week to push up its interest rate, again ignoring the April rates hold announced by the Reserve Bank of Australia (RBA).