Higher growth tipped for 2012, Shares move higher: Midday Roundup

The Westpac-Melbourne Institute leading index of economic activity has now risen above its long-term trend, tipping a possible surge in growth during 2012.

The index, which predicts the likely pace of economic activity three to nine months in the future, was at 4.5% in August, above the long-term trend of 3.3%.

However, that came before much of the current volatility in global markets occurred.

Westpac chief economist Bill Evans said in a statement that it is still too early to determine whether the index result can be trusted.

“Westpac is expecting growth momentum in the Australian economy in the second half of 2011 at an annualised pace of around 1.5%. Consistent with the signal from the Leading Index through the first half of 2011, that is below trend growth for the economy,” Evans said.

“The growth rate in the Index has improved from the 3.1% which was reported for July in last month’s report,” Mr Evans said.

The index noted growth in profits, productivity and dwelling approvals, although these were negated by lower manufacturing prices.

Shares open higher after Wall Street lead

The Australian sharemarket has opened slightly higher this morning after a positive result in the United States, where investors became optimistic after rumours of a new debt deal in Europe.

The benchmark S&P/ASX200 index was up 33 points or 0.8% to 4219.9 at 12.00 AEST, while the Australian dollar was up slightly to $US1.02c.

AMP shares rose 1.94% to $4.21, while Commonwealth Bank shares rose 1.18% to $48.01. NAB shares rose 0.99% to $24.47, as Westpac rose 0.88% to $21.77.

In the United States, the Dow Jones Industrial Average rose 180 points or 1.6% to 11,577.

CSL plans $900 million buyback

CSL has announced a $900 million share buyback this morning, along with reaffirming earlier profit guidance.

“CSL will conduct a further on market buyback of up to $900 million, which we intend to complete over the next 12 months,” CSL chairman Elizabeth Alexander said this morning, according to Fairfax.

“At the end of the first quarter of the current financial year, I can advise the company is trading consistently with our expectations,”

Alexander also said the company has reaffirmed its guidance of 10% growth.

Apple revenue misses expectations as iPhone sales miss target

Apple’s revenue figures have fallen short of analyst expectations, as iPhone sales disappointed, but the IT giant has tipped first quarter revenue of $US37 billion.

It posted quarterly revenue of $US28.27 billion and net profit of $US6.62 billion overnight.

Analysts had tipped revenue of $US29.69 billion, says Thomson Reuters I/B/E/S.

The company announced it had sold 17.07 million iPhone over the quarter, up 21% year on year but versus analyst expectations for 20 million sales.

Webjet quarterly profit lifts, tips 10% full-year profit rise

Online travel group Webjet says it expects full-year profit to 10%, after posting a 23% lift in quarterly profit amid “modest growth” in the industry.

Managing director John Guscic says the growth is driven by “special market stimulatory offers”.

“This creates an ideal environment for internet distribution which brings speed of offer to market and provides consumers with the ability to make rapid informed purchases.”

Shareholders liked the news, pushing its shares up 2.27% to $2.25 at 11.50 AEST.