Shares jump more than 2%, BrisConnections shareholder vote to go ahead: Economy roundup

The sharemarket has opened higher today despite massive job losses in the travel industry and some poor results from Wall Street overnight.

The benchmark S&P/ASX200 index opened just under 1% higher, but was up 85.3 points or 2.3% to 3756.9 at 12.10 AEST.

The Australian dollar also continued its recent strong performance, opening at a six-month high of US73 cents.

ANZ shares have gained 3.8% to $17.25, while Westpac also rose 3.8% to $20.75. Commonwealth Bank shares gained 3.7% to $36.91 as Woolworths lost 0.7% to $25.42.

Qantas shares dropped over 10% after the announcement that it will slash about 1750 jobs from its 34,000-strong workforce, including about 500 management positions.

The company also said that it will sell 10 aircraft, while reducing “flying capacity” by 50%, according to statements made by chief executive Alan Joyce on Sky News. Qantas shares are currently down 8.4% to $1.79.

In the US, Wall Street closed slightly lower after aircraft manufacture Boeing announced cuts in production output. The Dow Jones Industrial Average dropped 25.57 points or 0.32% to 8057.81.

Meanwhile, the long-awaited BrisConnections shareholders meeting is now underway after the Queensland Supreme Court ruled early this morning the vote could go ahead.

The vote will determine the future of the company and its $4.7 billion infrastructure project.

Young IT entrepreneur Nicholas Bolton is leading a charge to have BrisConnections wound up, but needs to get the backing of 75% of the company’s shareholders to win the day.

That looks unlikely, as the company’s second-largest shareholder, QIC, has opposed the winding-up proposal.

“There is value created only if the road gets built, built well, and as quickly as possible,” QIC said in a statement.

Meanwhile, the chair of the Australian Competition and Consumer Commission has warned that further bank mergers will challenge the competitiveness of the industry.

Graeme Samuel has said in The Australian Financial Review that the continued dominance of the major banks may promote anti-competitive behaviour.

“The risk is with four big banks, because of the diminished role of non-bank financial institutions, we end up with less than intense workable competition,” Samuel said.

“If there was another merger of one of the regional banks with the big four, you’d have to ask yourself this – is there the international global marketplace for corporate and institutional banking? That’s not so certain as things currently stand.”