Shares gain ground, employers fight to keep staff: Economy roundup

The Australian share market has opened higher today after increases in commodity prices overnight. The benchmark S&P/ASX200 index was up 13 points or 0.32% to 4060.2 at 12 noon AEST. The Australian dollar also gained to US81 cents as investors gained confidence after news emerged that more signs of recovery in the Australian economy have been spotted.

Commonwealth Bank shares jumped 1.3% to $37.93, while ANZ lifted 1.2% to $17.08. Westpac gained 0.7% to $19.88 as Woolworths lifted 0.5% to $26.23.

Australian Chamber of Commerce and Industry acting chief executive Greg Evans has said that despite the economic downturn, companies are hesitant to reduce staff counts.

“We are seeing a clear switch from full-time to part-time employment in many areas, and other flexibility measures in order to preserve employment,” Evans said.

“We have come off a period of marked skill shortages, so there is definitely a reluctance on the behalf of employers to make reductions in overall staffing levels.”

China has said it may impose sanctions against miners BHP Billiton and Rio Tinto if the two companies merge their iron ore operations.

“According to China’s anti-trust law, we can veto such a merger agreement if the concentration of overseas business operations will affect domestic market competition,” Ma Yu, the director of the foreign investment department at the Chinese Ministry of Commerce, told the Sydney Morning Herald.

Meanwhile, shareholders of giant OZ Minerals have approved the $1.4 billion deal with Chinese group Minmetals, after the company raised its offer to buy OZ Mineral’s assets.

“Minmetals looks forward to fulfilling the undertakings it made to the Australian government as part of this transaction and contributing to stronger bilateral ties between the two countries, particularly in the resources sector,” Minmetals’ project director for the transaction, Mark Liu, said in a statement.

“A significant part of the attraction to OZ Minerals was the quality of its employees, the majority of whom will join MMG.”

In the US, Wall Street recorded rises on higher commodity prices and good news from the labour market. The Dow Jones Industrial Average jumped 31.90 points or 0.37% to 8770.92.

New figures showed that May retail sales jumped 0.5%, but mostly due to higher petrol prices. But figures from the Labour Department showed that claims for jobless benefits dropped to a better-than-expected 601,000.

“It looks like we are turning the corner. There is pretty clear evidence that the worst of the labor downturn has passed, but we still expect more job losses,” Zach Pandl, an economist at Nomura Securities International, told Reuters.

Back home, beer and wine giant Foster’s has named former Brown Forman executive David Dearie as the new head of its wine division, which was separated from its beer, spirits and cider operations in February.

“David has a proven track record in wine, leading and growing businesses across multiple countries, channels and brands,” chief executive Ian Johnston said.

“David’s appointment completes the renewal of operational leadership required for the fundamental transformation of our business.”