Sydney, Feb 3, 2009 AEST (ABN Newswire) - The US stocks closed mixed over the weak consumer spending and income and a better-than-expected reading from the US factory sector.

Yesterday the Australian market ended lower. The benchmark S&P/ASX200 index was down 43.3 points, or 1.2%, at 3497.4 while the broader All Ordinaries index fell 34.6 points, or 1%, to 3443.5. The market is watching RBA's rate cut decision and earnings reports to be released today.

Key Economic Facts and Figures

Australia's home prices fell 0.8% in the December quarter, following a revised 2.4% drop in the previous three months, according to the Australian Bureau of Statistics. The house prices fell less than expected, but it is not likely to move the Reserve Bank's decision on slashing official rates again. Economists are expecting a 100 basis point rate cut by the RBA, which would take the cash rate to a 45-year low of 3.25 per cent.

The Australian Bureau of Statistics international trade in goods and Services data for December are also due.
M&A News

The wagering service provider, Centrebet (ASX:CIL), has launched a hostile takeover for its rival International All Sports (ASX:IAS). The A$18.6 million bid, funded by cash and an existing debt facility, would create an online sports and racing wagering company with nearly 125,000 direct customers.

Woolworths (ASX:WOW) said it had bought online auction business Langton's Fine Wines Auctions Pty Ltd for about A$13 million to bolster its web presence in the liquor sector.

The Chinese state-owned Chinalco told the Foreign Investment Review Board and Federal Treasurer Wayne Swan of its conditional agreement with Rio Tinto (ASX:RIO) yesterday. China Development Bank is believed to be backing Chinalco's proposed US$15 billion investment in Rio.

Queensland property group City Pacific (ASX:CIY) has sold its stake in a 489 hectare residential development to its co-owner Mirvac Group for the fire sale price of A$10 million, less than half its book value.

Important Corporate News

Coal miner Gloucester Coal (ASX:GCL) has confirmed its half-year earnings guidance ended by 31 December 2008 with net profit after tax approximately A$44 million, an increase of 750% on H1 2007. The company also said it is debt free with A$25 million cash on hand.

Regional broadcaster Prime Media Group Ltd (ASX:PRT) is predicting a 19% decline in first-half earnings. Prime said it expects earnings before interest and tax, pre-significant items, of about A$27 million for the six months to December 31, compared to A$32.2 million in the prior corresponding half.

Newcrest Mining (ASX:NCM) yesterday said it has boosted the size of an institutional share placement by 50% to A$750 million due to strong investor demand.

Commonwealth Bank (ASX:CBA) said on Monday that its cash profit after tax was likely to fall 16 per cent to A$2 billion for the six months to December 31 from A$2.385 billion for the corresponding period a year ago.

Qantas Airways (ASX:QAN) has gone into a trading halt pending a material announcement in relation to capital management initiatives.


Michelle Liang
Asia Business News Asia Bureau
Tel: +61-2-9247-4344

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