Real estate agents' confidence soars

AUSTRALIAN businesses may be doing it tough, but at least real estate agents are feeling pretty good.

A survey of property industry sentiment shows confidence has risen to its highest level in 18 months.

That goes against the wider trend in business sentiment, which remains stuck at below-average levels.

And there's good reason for real estate agents feeling positive: house prices are increasing and investors and owner-occupiers are starting to borrow more.

Property Council of Australia chief operating officer Ken Morrison says there is a feeling would-be buyers are returning to the market after a tough couple of years.

"Last year's fence-sitters have removed the splinters and made a clear decision to walk on the sunny side of the street," he said.

ANZ chief economist Warren Hogan says low interest rates and gains in stock markets have boosted economic sentiment since the start of 2013, which was flowing through to the property market.

He said prices would continue to rise, though any gains would be restricted by concerns about affordability.

"Increased population growth and subdued home building activity will see demand/supply fundamentals tighten further," Mr Hogan said.

"Nonetheless, difficult affordability perceptions and an ongoing sense of caution in the household and financial sectors will limit the rebound in house prices in this cycle."

The Property Council-ANZ confidence index jumped from 107 to 124 at the start of the June quarter, its highest level in 18 months.

An index reading of 100 is considered neutral, so the latest survey shows confidence is very strong in the industry.

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Real estate agents' confidence soars

AUSTRALIAN businesses may be doing it tough, but at least real estate agents are feeling pretty good.

A survey of property industry sentiment shows confidence has risen to its highest level in 18 months.

That goes against the wider trend in business sentiment, which remains stuck at below-average levels.

And there's good reason for real estate agents feeling positive: house prices are increasing and investors and owner-occupiers are starting to borrow more.

Property Council of Australia chief operating officer Ken Morrison says there is a feeling would-be buyers are returning to the market after a tough couple of years.

"Last year's fence-sitters have removed the splinters and made a clear decision to walk on the sunny side of the street," he said.

ANZ chief economist Warren Hogan says low interest rates and gains in stock markets have boosted economic sentiment since the start of 2013, which was flowing through to the property market.

He said prices would continue to rise, though any gains would be restricted by concerns about affordability.

"Increased population growth and subdued home building activity will see demand/supply fundamentals tighten further," Mr Hogan said.

"Nonetheless, difficult affordability perceptions and an ongoing sense of caution in the household and financial sectors will limit the rebound in house prices in this cycle."

The Property Council-ANZ confidence index jumped from 107 to 124 at the start of the June quarter, its highest level in 18 months.

An index reading of 100 is considered neutral, so the latest survey shows confidence is very strong in the industry.

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Premier Investments profit soars 21%

PREMIER Investments, the retailer behind brands including Just Jeans and Portmans, has brushed off the retail gloom and lifted its first half profit by 21 per cent.

The group, which has been rejuvenating its clothing brands, lifted its profit to $46.5 million while revenues rose 2.6 per cent to $460.3 million.

The rise in earnings was attributed to outstanding results from womenswear retailer chains Portmans and Dotti, as well as improved profits at Just Jeans and Jacqui E.

Cost cuts also helped.

Chief executive Mark McInnes did not give any guidance on the outlook for the retailer's full year earnings.

However, he said trading for the first six weeks of the second half of the group's fiscal year were in line with expectations.

"Despite the severe pressures facing all Australian retailers, Premier continues to be well positioned to take advantage of all its growth opportunities," he said.

Premier lifted its fully-franked interim dividend by one cent to 19 cents a share.

Chairman Solomon Lew said benefits from the retailer's six-point earnings improvement plan, which began 18 months ago, had helped lift profits.

The group's costs had fallen 20 per cent, margins had improved and online sales were up by 51 per cent.

While Portmans and Dotti had shown great improvements, work was underway to improve the Jay Jays jeans chain.

Meanwhile, Premier plans to open more stores for its stationary brand Smiggle, which has been a huge hit in Singapore.

Chairman Solomon Lew said benefits from the retailer's six-point earnings improvement plan, which began 18 months ago, had helped lift profits.

The group's costs had fallen 20 per cent, margins had improved and online sales were up by 51 per cent.

While Portmans and Dotti had shown great improvements, work was underway to improve the Jay Jays jeans chain.

Meanwhile, Premier plans to open more stores for its stationary brand Smiggle, which has been a huge hit in Singapore.

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Dow soars to record highs

US confidence boosting global markets DOW JONES hits a new record high.

Traders work on the floor of the New York Stock Exchange. Source: AFP

Traders work on the floor of the New York Stock Exchange. Source: AFP

THE Australian share market has surged to its highest level since September 2008 after Wall Street reached a record high overnight.

The benchmark ASX200 index jumped 0.85 per cent to 5118 points within the first hour of opening as the global outlook brightens.

At 12pm AEDT, the benchmark S&P/ASX200 index was up 55.5 points, or 1.09 per cent, at 5130.9 points.

Official figures released today showed that Australia's economy grew by 0.6 per cent in the last three months of 2012, largely in line with expectations.

The rally on global stock markets was driven by the new Chinese leaderships vow to maintain its growth target, an improving US outlook and investors betting the US, UK and Japanese central banks will continue stimulus measures.

The Dow Jones Industrial Average powered to an all-time record high overnight exactly four years after hitting bottom in the worst economic crisis since the Great Depression.

After more than doubling its value in a steady march upward since March 2009, the Dow assaulted the record from the opening bell and ended the day at 14,253.77, nearly 90 points above the former closing high on October 9, 2007.

The broader index of the US markets, the S&P 500, also settled higher, but at 1539.79 remained 1.6 per cent below its all-time trading high. It was a dramatic rebound that came even as the broader economy continues to struggle to leave behind the 2008-2009 recession, and the government in Washington battles over how to trim its massive deficit, a legacy of the economic crisis.

"It's been a good economy, accompanied by good earnings, coupled with very low interest rates. And no sign that it's over," said Hugh Johnson, chairman and chief investor officer at Hugh Johnson Advisers.

"And it's the only game in town," he said, referring to the low returns on other investments.

The Dow, which weighs the stock prices of 30 top companies in a range of industries, and been a key gauge of health in US capital markets for 117 years, was last at these levels in October 2007, the virtual eve before a financial storm engulfed markets.

A bursting of the housing market and stocks bubble unleashed the deepest recession since the 1930s. In the crash the Dow plunged 54 per cent over 15 months, the impact wiping out the savings of millions and feeding a crisis in the financial industry that forced the government to bail out banks and two major automakers.

But the rebound of company earnings coupled with low Federal Reserve interest rates have fed the recovery in the stock markets.

Also helping has been a set of recent economic data that has been generally solid, if unspectacular. It has raised new questions of whether a fresh, dangerous bubble is building in capital markets, an issue that has been debated in recent meetings of Fed policy makers.

But analysts mostly dismiss that, and describe rising, but cautious, confidence in the real economy.

Compared with the economic conditions in 2007, today's market looks stronger, said Art Hogan of Lazard Capital Markets. For one thing, corporate balance sheets are robust.

"The economy is in a better place," said Mr Hogan. "The last time we were here, the economy was about to fall off a cliff."

Greg Peterson, director of research at Ballentine Partners, said the valuation multiples of earnings are low compared with historic norms.

"This high is imminently reasonable," Mr Peterson said. "It's not a bubble."

The overnight surge came on the heels of rising equity markets in China and throughout Europe, said Chris Low, chief economist at FTN Financial.

The rally gained additional support mid-morning from a pickup in US services sector growth in February, according to the ISM purchasing manager survey.

Still, recent economic reports suggests that the Dow is outpacing the economy as a whole. Last week, the US Commerce Department reported that fourth-quarter economic growth came in at just 0.1 per cent, and the unemployment rate has been stuck around 7.9 per cent.

With AFP.

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AirAsia profit soars, bullish on outlook

Asia's largest low-cost carrier, AirAsia has reported a 168 per cent jump in fourth-quarter profit. Source: AAP

AIRASIA, Asia's largest low-cost carrier by fleet size, says its fourth-quarter profit has jumped 168 per cent year-on-year amid increased passengers.

AirAsia said in a statement that net profit for the quarter ending December 31 stood at 350.65 million ringgit ($A111.42 million), up from 130.68 million ringgit in the same quarter the previous year thanks to "a seasonally strong quarter".

Revenue for the quarter was a record 1.41 billion ringgit, up 10 per cent, as more people flew the airline, which increased its aircraft in Malaysia to more than 60.

"It has been another good quarter and overall a great year for AirAsia as we continue to defy the industry in terms of operational and financial performance," said Malaysia AirAsia chief executive officer Aireen Omar.

For the full financial year, AirAsia recorded a 238 per cent jump in net profit to 1.88 billion ringgit despite a 1.0 per cent rise in the average fuel price this year.

Its 2012 revenue increased by 11 per cent to 5.0 billion ringgit.

Group chief executive officer Tony Fernandes was bullish about the year ahead as AirAsia expands its model - no frills and keeping operational costs low.

"The aviation landscape is constantly changing with high fuel prices and new competition, but through all these challenges AirAsia will continue to defend our leadership titles," he said.

AirAsia has grown rapidly since Fernandes, a former record industry executive, bought the failing airline in 2001. It initially had only two aircraft in operation.

The group now has a total fleet of 120 A320s and has set up subsidiary budget carriers in Indonesia, the Philippines, Thailand and Japan.

The airline, one of the biggest customers for European aircraft maker Airbus, is expecting 360 more aircraft to be delivered by 2026.

Last week it announced a new airline joint venture with India's Tata conglomerate.

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