Jobs data stronger than expected: Midday roundup

Newly released jobs data has beaten economists’ expectations, with employment rising by 23,400 in June according to latest figures from the Australian Bureau of Statistics.

The figures show full-time employment rose by 59,000 while part-time employment dropped by 35,600. Economists had predicted a rise of 15,000.

The unemployment rate remained flat at 4.9% and ICAP senior economist Adam Carr told Reuters the result was “tainted only by the downward revision to last month’s number.

“I’m confident that we’ll see jobs growth accelerate notwithstanding toxic sentiment in the market in the fact that our business leaders tell us we’re in a recession.

“I think prospects are good but don’t think this will lead to a rate hike while sentiment is so toxic.

“I think it’s going to take some fairly big numbers to turn this around and these numbers today don’t cut the mustard.”

Construction industry contracts

The Australian construction industry has contracted for a 13th consecutive month due to weakness in the residential building sector, according to the latest figures.

The Australian Industry Group-Housing Industry Association performance of construction index fell by 3.8 points to 35.8, well below the 50-point level separating expansion from construction.

“The difficult conditions experienced during 2010-11 look set to continue into the opening months of the new financial year,” AIG director of public policy Peter Burn said.

The home building sector fell by 5.7 points to 34.1% and the four major sub-sectors recorded declines.

“The residential construction sub-sectors are continuing to suffer from widespread post-GFC consumer caution and ongoing fears of further interest rate rises,” Burn said.

“The accelerated decline in the detached house component of the Australian PCI in June is alarming given that this sector accounts for over 60% of all new residential construction and interest rates to June had been on hold for seven consecutive months.”

Austar warns on Foxtel deal

Austar has issued a statement saying that an agreement between parent company Liberal Global and pay TV giant Foxtel has not been finalised.

“Austar notes that discussions regarding definitive agreements in regard to the proposal are continuing between Austar, Liberty Global Inc and Foxtel, and the conditions upon which the proposal was made have yet to be satisfied,” Austar said in a statement today.

“In light of the conditional nature of the proposal no assurance can be given that the proposal will lead to a definitive transaction.”

Shares flat on weak US lead

The Australian share market opened flat this morning after a weak lead from US stocks.

The benchmark S&P/ASX200 index was down 12 points or 0.27% to 4592 at 12.10 AEST and the Australian dollar rose to $US1.07c after official jobs data was released.

AMP shares rose 0.51% to $4.89, Commonwealth Bank shares gained 0.1% to $51.52, Westpac lost 0.23% to $21.84 and NAB gained 0.4% to $25.06.

In the US the Dow Jones Industrial Average gained 56 points or 0.45% to 12,626.02.

ASIC says corporate insolvencies on the rise

The Australian Securities and Investments Commission says court liquidations rose 8.6% to 2,409 in the 11 months to May and director-initiated creditors voluntary liquidations rose 7.6% to 3,835.

ASIC’s senior executive leader of its insolvency practitioners team Adrian Brown said Western Australia was seeing its “fair share of corporate insolvencies” despite being viewed as a boom state.

“Interestingly, receivership and voluntary administration appointments Australia-wide have fallen,” Brown said.

Receiverships were down 1.6% to 1,219 and voluntary administrations slumped 5.6% to 1,332.