Another 2500 jobs lost: Economy roundup

Just a day after clothing manufacturer Pacific Brands slashed 1850 jobs, more workers have been made redundant from three separate organisations.

Drilling contractor Boart Longyear has scrapped 2000 jobs despite delivering a 92.3% rise in profit in the 12 months to 31 December, jumping to $156.7 million.

Boart chief executive Craig Kipp said business activity has fallen as access to funding has slipped away. “Due to the ongoing volatility in the global economic environment, forecasting the level of business activity over the coming months remains challenging,” Kipp said.

Meanwhile, travel guidebook company Lonely Planet has slashed its workforce by 10%, making 50 jobs redundant. The cuts will affect the company’s Australian, US and British offices.

Car parts manufacturer Drivetrain Systems International has cut 400 workers from its payroll, but the company says it does not have enough money to pay out entitlements.

Shares gain ground

The Australian sharemarket has opened higher today, despite Wall Street closing lower overnight.

The benchmark S&P/ASX200 index was up 28.3 points or 0.85% to 3355.8 at 12.05 AESDT. The dollar slipped back to US64 cents.

NAB shares jumped 1% to $17.50, while Commonwealth Bank gained 0.9% to $29.38. Westpac also gained 1.2% to $16.37.

ANZ shares gained 1.4% to $12.67, despite news the group will cut its 2009 dividend by up to 25%, saving $500 million in the process. The group also says full year cash earnings will remain at a similar level to 2008.

“We see these steps as measured and sensible in light of the economic conditions facing the market,” chief executive Mike Smith said. “While I know reducing dividends impacts on all shareholders, particularly individuals, it is in the best long term interests of all our shareholders in this environment.”

Meanwhile, media group Fairfax has entered a trading halt ahead of a capital raising to help pay off debt.

Wesfarmers, owner of the Coles supermarket chain, has finished a capital raising totalling $1.8 billion. The company expects to commence normal trading on 4 March.

Overseas, Wall Street stocks dipped into the red again after new housing data showed 7% of US mortgages are in default.

The Dow Jones Industrial Average fell 80.05 points or 1.09% to 7270.89. Oil prices also leapt 6% to $US42 a barrel.