Unemployment falls to 5.2%, Shares hit one-month high: Midday Roundup

Official jobs figures have beaten expectations with the unemployment rate falling to 5.2% in September.

According to the Australian Bureau of Statistics, 20,400 jobs were created last month, with full-time jobs accounting for 10,800 of the new jobs.

Economists had expected unemployment to stay steady at 5.3%.

Australian dollar rises, rate cut expectations drop on jobs figure

The result prompted a rise in the Australian dollar by almost one US cent to 102.3 US cents, after the local currency dipped below parity yesterday.

The result also lessens the likelihood of a rate cut next month, and adds to a better-than-expected National Australia Bank business survey released on Monday.

Meanwhile, Westpac says a 5% fall in its unemployment expectations survey suggests “households may be seeing an improvement in labour market conditions,” although the survey remains 27% higher than it was six months ago.

Australian sharemarket reaches one-month high

The Australian sharemarket reached a one-month high this morning amid optimism a European debt deal is on its way, rebounding from a dip yesterday after a week-long rally.

At 11.40am, the S&P/ASX 200 index was up 0.73% to 4235.2, and the All Ordinaries index was up 0.82% to 4297.1.

The gains were broad-based, with the major miners and Telstra trading higher before midday although the banks were mixed.

IG Markets analyst Cameron Peacock said positive US leads and higher commodity prices were likely to support the financial, materials, industrials and energy sectors.

ACCC gives preliminary approval to Virgin Australia/Singapore Airlines alliance

In company news, the competition regulator has given preliminary approval to a tie-up between Virgin Australia and Singapore Airlines, which will see the two airlines cooperate on international and domestic connecting routes.

“The ACCC considers that this alliance is likely to result in material benefits to the public, including enhanced products and services, in particular increased online
connectivity for passengers,” ACCC chairman Rod Sims said in a statement.

“The ACCC also considers that the alliance is likely to make Virgin Australia more competitive with other airlines, including Qantas.”

Further comment on its draft decision is being sought.