THE NEWS WRAP: Swan promises “modest” surplus, flags tax sweetener for small businesses

Treasurer Wayne Swan says tomorrow’s Budget will contain a “modest” surplus, with a further tax sweetener for small businesses not in the “fast lane” of the mining boom.

From July, businesses will be able to use past profits to offset current losses by up to $1 million in a so-called “carry back” measure. An estimated 100,000 businesses will benefit from the move.

The Budget is also set to contain a $500 million package for dental care and a new payment for parents of school-age children.

Firms warned over cartel behaviour

The competition watchdog has warned the heads of 2,500 construction firms over the legal perils of cartel-like behaviour.

Rod Sims, chairman of the Australian Competition and Consumer Commission, said that executives in the construction industry will have immunity if they come forward to admit they are part of a cartel.

France elects new president

France has a Socialist president for the first time in a generation after the election of Francois Hollande.

Hollande beat incumbent Nicholas Sarkozy by around 4% of the vote, with the new president promising to shift the economic focus from austerity to growth.

Markets

The Dow Jones Industrial Average dropped 168.32 points, or 1.3%, to 13,038.27 on Friday. The Australian dollar dipped to 102.39 US cents.