Construction work rises in third quarter, Mining tax passes lower house: Midday Roundup

Construction activity increased over 12% during the third quarter, according to the latest figures from the Australian Bureau of Statistics.

The figures have exceeded analysts’ expectations.

Total construction rose 12.5% to $46.46 billion in the September quarter, on a seasonally adjusted basis, with the market only expecting a rise of just 2%.

Most of the work was engineering construction, which rose by 22.6% to $28 billion, while total building work rose by 0.6% to $19.41 billion.

Government promises to find savings as mining tax passes

Meanwhile, the Government has succeeded in passing its controversial mining tax in the lower house after negotiating with independent MPs and the Greens.

The tax kicks in next July and covers coal and iron ore production.

It is expected to bring in $11 billion in its first year, although the Government has been criticised for concessions leaving an estimated $60 million shortfall over the next three years.

Federal Treasurer Wayne Swan told ABC Radio that the Government would “find the savings”.

Stocks open weaker on flat US data

The Australian sharemarket has opened weaker this morning after a disappointing lead from the United States, where investors still remain nervous over the European debt crisis and also the country’s own sluggish recovery.

The S&P/ASX200 index was down 27 points or 0.7% to 4105.2 at 12.00 AEST, while the Australian dollar also fell after the US Government revised its forecasts for the country’s economy – the dollar now stands at $US0.98c.

ANZ shares lost 0.97% to $19.37, while Commonwealth Bank shares fell 0.55% to $47.14. Westpac fell 0.74% to $20.21 as NAB fell 1.34% to $22.82.

In the United States, the Dow Jones Industrial Average fell 53 points or 0.5% to 11,493.7.

APRA, RBA adopt new banking standards

The Australian Prudential Regulation Authority and Reserve Bank will adopt new provisions in the Basel III reforms that will see the central bank provide facilities to ensure banks have enough cash in crisis periods.

“At the moment, the gross stock of Commonwealth debt on issue amounts to around 15% of GDP (gross domestic product), state government debt (semis) is around 12% of GDP,” assistant RBA governor Guy Debelle announced this morning, according to AAP.

“These amounts fall well short of the liquidity needs of the banking system.”

“Thus, to reduce the likelihood of systemic risk, a bank will be able to hold some share of its liquid assets in the form of self-securitised mortgages.”

Property developer Stockland says first home buyers most active market

Property developer Stockland has affirmed its earnings per share guidance, saying first home buyers were its most active market and the recent rate cut has narrowed the gap between renting and buying.

Chief executive Matthew Quinn added that Stockland had purchased 2.6% of its capital, as part of its plan to buyback 5% of its shares.

Quinn added that it had sold $625 million of its assets this financial year.

Former Gunns chief charged with insider trading: Reports

John Gay, one-time boss of Tasmanian timber company Gunns, has reportedly been charged with insider trading after selling the company’s shares before a profit and share-price slump.

The ABC has reported that Gay is expected to appear in the Launceston Magistrates Court shortly.

Gay sold 3.4 million shares at the end of December 2009. Two months later, the company surprised the market by revealing its profit had slumped by 98%.

Gunns will hold its AGM this week in Melbourne.

Government promises to find savings as mining tax passes

Meanwhile, the Government has succeeded in passing its controversial mining tax after negotiating with independent MPs and the Greens.

The tax kicks in next July and covers coal and iron ore production.

It is expected to bring in $11 billion in its first year, although the Government has been criticised for concessions, leaving an estimated $60 million shortfall over the next three years.

Federal Treasurer Wayne Swan told ABC Radio that the Government would “find the savings”.