Australian market set to open higher

THE Australian market has opened slightly higher despite falls in resources stocks.

IG market strategist Stan Shamu said commodity prices continued to fall overnight and he expected resources stocks to drop during the day, especially gold.

"Commodities remained under pressure overnight with notable weakness in gold," he said.

"We expect gold names to struggle today, led by Newcrest Mining which is headed for its lowest level since June 2006 of $15.64."

Newcrest shares opened 81 cents, or 5.11 per cent, lower at $15.05.

The mining giants all dropped on opening.

BHP Billiton lost 11 cents to $33.92, Rio Tinto dived 53 cents to $55.24 and Fortescue tumbled six cents to $3.53.

The four major banks all opened in positive territory.

Commonwealth Bank surged 79 cents to $73.44, National Australia Bank jumped 14 cents to $33.21, ANZ added eight cents to $30.06 and Westpac gained five cents to $31.72.

Graincorp shares fell 0.5 cents to $12.745 after it announced its first half profit had fallen by 34 per cent due to costs from its purchase of several food companies.

Australia's largest grain handler is also currently working with food giant Archer Daniels Midland to complete a $3 billion takeover.

In economic news on Thursday, the Australian Bureau of Statistics is due to release March international merchandise imports data.

KEY FACTS

* At 1016 AEST on Thursday, the benchmark S&P/ASX200 index was up 14.3 points, or 0.28 per cent, at 5,206, while the broader All Ordinaries index was up 13.5 points, or 0.26 per cent, at 5,186.8.

On the ASX 24, the June share price index futures contract was up eight points at 5,209, with 9,973 contracts traded.

* National turnover was 226.93 million securities worth $774.71 million.

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Fire rips through luxury hotel

A FIRE at a luxury hotel on Phillip Island has caused more than $1 million worth of damage.

The second floor of Castle Villa by the Sea on Steele St in Cowes was destroyed after a fire broke out around 7pm last night.

Firefighters battled the blaze for six hours with 13 trucks on scene.

No-one was hurt in the fire and arson investigators will return to the scene this morning.

The hotel commands up to $675 per room a night.

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France's Hollande anticipates zero growth

France has slipped back into recession, with the president predicting zero growth for 2013. Source: AAP

FRENCH President Francois Hollande says he now anticipates "zero growth" for 2013, after the eurozone's second largest economy slipped back into recession.

"It is likely that there will be zero growth in 2013," Hollande told a reporters in Brussels, shortly after his finance minister in Paris tipped 0.1 per cent growth for 2013.

The Socialist leader maintained that France had come through the worst after sliding into recession in the first three months of the year.

The eurozone as a whole, according to new figures released on Wednesday by the European Union, posted its sixth consecutive quarter of economic contraction - leading economists to label it the "weakest link" in the sluggish global economy.

Hollande said the confirmation of recession for his country was "the announcement of something that had already happened, not something about to take place".

"It is my view that we are past the worst," he said after talks with European Commission head Jose Manuel Barroso focused on a summit of EU leaders back in Brussels in seven days' time.

However, Hollande refused to entertain notions that France - the eurozone's second biggest economy, but on an increasingly divergent path from leading light Germany - was dragging Europe down.

"Is France a separate case?" Hollande asked rhetorically, after the 17-state eurozone posted a 0.2 per cent contraction in economic output between January and March of this year, and a 1.0 per cent slide year-on-year.

Hollande said the recession across the eurozone - home to 340 million citizens and the biggest tariff-free market outside the United States - could be explained by "the accumulation of austerity politics".

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Virgin share tumble after profit warning

VIRGIN Australia's shares have tumbled following a profit warning issued by the airline after the market closed on Wednesday.

Virgin Australia said its profits would be lower than those for 2011/12.

"The adverse impact to revenue from the introduction of the Sabre (reservation) system in the third quarter is not likely to be recovered by the end of FY13, given the slower than anticipated improvement in trading and economic conditions," the airline said in its trading update.

In February, Virgin Australia reported a first half profit slump of 56 per cent, but said it expected to improve its underlying performance despite challenging economic conditions.

The airline made a net profit of $23 million in the six months to December 31, down from $51.8 million in the previous corresponding period.

At 1105 AEST, its shares were down 3.5 cents, or 7.61 per cent, to 42.5 cents.

Meanwhile, it expects to complete its 60 per cent purchase of budget carrier Tiger Airways in July.

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$A mildly higher after weak US data

THE Australian dollar is slightly higher as the greenback's week-long rally stalled following the release weak New York State manufacturing data.

At 0700 AEST on Thursday, the local unit was trading at 98.99 US cents, up from 98.72 cents on Wednesday.

During the overnight session, the currency peaked at 99.01 US cents, its highest level since Monday.

BK Asset Management managing director Kathy Lien said the fall in New York state manufacturing activity in May dampened hopes that the US Federal Reserve would end its program of bond purchases aimed at boosting the American economy.

Over the past week, the US dollar rallied against all the major currencies on hopes that that program would end soon.

"The reason why you've seen a mild amount of strength in the Australian dollar is because we've had a weaker US economic report," Ms Lien said from New York.

"That raised some concerns whether the improvements in April economic data will be sustained into May and whether all this talk of the Fed tapering asset purchases is justified.

"So, you saw a little bit of a sell-off in the US dollar and that's driven the Aussie higher. But, it is relatively modest."

Ms Lien said investors would get further indications about the state of the US economy during the offshore session on Thursday night.

US housing starts for April and the Philadelphia Federal Reserve manufacturing survey for the same month will be released.

Ms Lien said she expects the Australian dollar to trade in a range between 98.60 and 99.25 cents on Thursday.

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US stocks hit fresh record highs

US stocks closed at new all-time highs following a choppy day of trading on Wednesday as investors shrugged off more economic gloom from the eurozone.

The Dow Jones Industrial Average rose 60.44 (0.40 per cent) to 15,275.69, setting a new record closing high for the second day in a row.

The broad-based S&P 500 added 8.44 (0.51 per cent) at 1658.78, its fourth straight day of record closes, while the Nasdaq Composite Index increased 9.01 (0.26 per cent) to 3471.62.

All three indices rose through the early afternoon, then retreated somewhat before staging a late rally.

Official European Union figures showed the eurozone economy shrank 0.2 per cent between January and March, the sixth consecutive quarterly contraction in the longest recession since the single currency bloc was established in 1999.

On the positive side on this side of the Atlantic, builder confidence in the US market for newly built, single-family homes rose three points to 44, according to a reading on the National Association of Home Builders/Wells Fargo Housing Market Index.

Art Hogan of Lazard Capital Markets said the market was reacting to a "steadily improving housing sector" as shown by the NAHB data.

"It's been the same theme for most of this year," said Michael James, managing director of equity trading at Wedbush Morgan Securities. "Any pullback in the market is a buying opportunity."

James said the market was cheered by strong gains in financial equities, such as JPMorgan Chase, which rose 1.7 per cent.

Apple dropped 3.4 per cent following reports that a number of leading hedge funds exited or reduced their holdings in the company in the first quarter. Among those to trim holdings were David Tepper's Appaloosa Management, which reduced its stake to 540,00 shares from almost 913,000 shares.

Google put on 3.3 per cent after unveiling a music service for smartphones and tablets powered by its Android software. The technology giant's Google Play All Access launched in the US with a monthly subscription fee of $10.

The yield on the 10-year US Treasury slipped to 1.94 per cent from 1.95 per cent late Tuesday, while the 30-year held steady at 3.16 per cent, the same level as Tuesday. Bond prices move inversely to yields.

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The most iconic Aussie road trip?

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• Famous Aussie photographer embarks on road trip
• Driving from Bondi to the Gold Coast, will be filming
• Says Aussies need to appreciate our own country
• In pictures: Stunning Aquabumps shots

FAMOUS surf photographer Aquabumps has urged Aussies to appreciate what's in their own backyard as he leaves Sydney today on an iconic road trip.

Eugene Tan, who started Aquabumps in 1999, will drive from Bondi to the Gold Coast for the Land Rover Quicksilver Pro event at Snapper Rocks, a 12-day event which attracts more than 80,000 locals and viewers worldwide. He'll stop along the way to capture iconic surf moments.

"It's a pretty iconic drive to Snapper Rocks," Tan said. "The scenery is amazing, it's a pilgrimage for surfers."

While there's no set itinerary, Tan, who will be travelling with a group of up-and-coming surfers, will stop at various beaches along the way including at Seals Rocks, Foster, Crescent Head, Port Macquarie and Byron Bay, ending up at the Gold Coast.

Eugene Tan is set to leave for a great Australian road trip. Picture: Ken Butti

"Australia is so beautiful, I love the diversity from Sydney to the Gold Coast, there's so much plant life and a huge coastline," he said.

"You can find peace and quiet easily and the colour is great. We have beautiful headlands, I like to put them in the backdrop of my photos to give them some perspective."

Surf photography by Aquabumps - Eugene Tan. Picture: Eugene Tan Source: Supplied

Surf photography by Aquabumps - Eugene Tan. Picture: Eugene Tan

Tan said one of the highlights of the trip will by Byron Bay.

"I'm pretty excited about going to Byron, it's pretty spectacular, the whole vibe, the warmth, warm water, long waves."

Surf photography by Aquabumps - Eugene Tan. Picture: Eugene Tan Source: Supplied

He'll be filming his journey and will post footage and photographs onto the Land Rover Australia Facebook page along the way. There will also be a competition for surfing enthusiasts to showcase their own photographic talents.

Surf photography by Aquabumps - Eugene Tan. Picture: Eugene Tan Source: Supplied

Tan urged Australians to follow his lead and travel closer to home instead of going off overseas.

"The Aussie dollar is so high, domestic travel is dwindling, so you've got to remember what's in your own backyard."

Surf photography by Aquabumps - Eugene Tan. Picture: Eugene Tan Source: Supplied

Tan, who quit his day job at 30, has watched and captured the sunrise every day for the past 14 years and has built an extremely successful business out of it – his Facebook page alone has more than 74,000 likes.

"I'm addicted to shooting sunrises, the early light is the best in Sydney. I've been getting up to shoot the sunrise every day for 14 years. You never master it, it's like golf."

In pictures: Stunning Aquabumps shots

Surf photography by Aquabumps - Eugene Tan. Picture: Eugene Tan Source: Supplied

Surf photography by Aquabumps - Eugene Tan. Picture: Eugene Tan Source: Supplied

 
 

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