“Google tax” could hurt Aussie businesses overseas; Iron ore tanks; Shares up as gold rises: Midday Roundup

Federal Treasurer Joe Hockey’s “Google tax” could hurt Australian businesses overseas, according to the Parliamentary Budget Office.

Fairfax reports Hockey’s attack on multinational profit-shifting could be in breach of Australia’s international tax treaties.

The independent adviser warned the unilateral introduction of a “diverted profits tax” like ones being considered by Australia and Britain could result in the imposition of “revenge taxes” on Australian businesses operating overseas.

Iron ore price tanks

The price of iron ore has fallen below the $US50 a tonne mark for the first time for the first time in a decade.

The Australian reports at the end of the latest session, benchmark iron ore for immediate delivery to the port of Tianjin in China was trading at $US49 a tonne, down 3.9% from its prior close of $US51 a tonne.

The figure is a record low since The Steel Index began releasing the data in 2008.

Shares up as oil, gold rise

Shares have rallied this morning off the back of a surprising rise commodity prices.

“Despite screaming headlines in various Australian business dailies, commodity prices rallied overnight,” said Michael McCarthy, chief market strategist at CMC Markets.

“Oil jumped more than $2 per barrel, and gold slammed through the U$1200 mark, rising $21 in the session.”

“These dramatic lifts should see Australian resource shares on the front foot today. Futures markets are indicating a lift of around 0.5% at the open, but positive momentum could see further gains.”

The S&P/ASX200 benchmark was up 38.1points to 5898.9b points at 11:33PM AEST. On Wednesday, the Dow Jones closed down 0.44%, falling 77.94 points to 17,698.2 points.