In this section
Offers for readers
Follow the news from interest
The comment stream
- 1 of 32154
- 1 of 439
The news stream
- 90 seconds at 9 am: Now the Greek creditors turn 46
- Govt to sell up to 2,000 houses 42
- Markets now see OCR cut in 2015 36
- The problem with lifestyle blocks 33
- Little focuses on small business jobs 31
- RBNZ 'pouring petrol on housing fire' 29
- Calls for OCR to remain at 3.5% 22
- 90 seconds at 9 am: Yellen's 'patient' message 20
- Bernard's Top 10 19
- Property investment; Why bother? 18
90 seconds at 9 am: US jobs expansion; Chinese PMI marking time, Aussie manufacturing in big contraction; Westpac makes bid for HK bank stake; NZ$1 = US$0.844 TWI - 76.1
Here's my summary of the key news overnight in 90 seconds at 9 am, including news that tomorrow's Australian rate review is expected to be a tame affair. Markets are not anticipating any change in their 3.0% rate which represents a breather from the steady reductions since October 2011.
In the US, companies kept expanding headcounts in January and revisions to previous months’ showed even bigger gains as their job market grew. American stocks rallied for a fifth week on this news and better-than-estimated earnings sent the main indexes toward record highs. Service industries grew in January too, and at about the same pace as in the prior month, showing the biggest part of their economy is weathering Washington's budget battles.
And a brief update on Jon Corzine's collapsed MF Global. You may recall Corzine as a former New Jersey governor and later Goldman Sachs supremo, and the collapse of MF Global was reported as "another Madoff". Well, it seems it was not insolvent after all. After the stress of bankruptcy and liquidation, even unsecured creditors might get back 100% of their money - quite different to how it was originally presented.
Official Chinese PMI came in at 50.4 in January, slightly lower than expected. That weighed on the Aussie currency.
Australian PMI however came in at 40.2, described locally as 'sluggish' but actually is a disasterous contraction. New Zealand's PMI January won't be released until later next week, but was 50.1 in December. This may go some way to explaining why markets presently prefer the Kiwi to the Aussie.
Over the weekend it emerged that Westpac made a surprise bid in December for a NZ$500 million stake in Hong Kong’s Bank of East Asia. The bid failed it seems, but it is a clear sign Australia’s second-largest bank is becoming more serious about growing in Asia.
Westpac derived most of its NZ$8.1 billion cash profit last year from Australia and New Zealand and has operations in five Asian countries, compared to 14 for ANZ, Commonwealth’s seven and National Australia Bank’s six.
The New Zealand dollar starts today quite a bit higher at 84.4 USc, and especially against the Aussie at 81.2 AUc, and the TWI starts the week at 76.1. (The all-time high is 76.9.)