New home sales rise by 0.3% in November, $45 billion gas deal in doubt: Economy Roundup

New home sales rose during November after two consecutive months of falls, according to the latest figures from the Housing Industry Association.

But growth in new home sales amounted to just 0.3%, the group said, due to a lack of investors plugging the hole left by fewer first home owners.

New house sales dropped by 3.5% in Victoria, and by 1.8% in Queensland while in WA a rise of 12.1% was recorded. Sales were also 2.6% higher in South Australia with HIA chief economist Harley Dale saying November’s figures show investor and upgrade activity isn’t providing the same amount of momentum as first home owner activity.

“The multi-unit sector, meanwhile, continues to look extremely weak as the medium/high density end of the sector faces an on-going lack of available credit,” Dale said.”This situation does not auger well for an easing in very tight rental market conditions over 2010.”

The Australian sharemarket has opened 1% higher this morning, after stocks rose on Wall Street and metals and oil prices continued to rise.

The benchmark S&P/ASX200 index was up 44 points or 1.92% to 4920.9 at 12.00 AEST, while the Australian dollar also rose to US91c.

Commonwealth Bank shares rose 1.5% to $55.68, while ANZ gained 0.3% to $22.97. NAB rose 1.2% to $27.73, while Westpac shares also jumped 1.1% to $25.57.

In the mining sector, Leighton Holdings has managed to secure a 12-month contract extension for a Queensland coal mining project worth approximately $140 million.

Leighton subsidiary Thiess will provide mining services through December 2011, after receiving the contract to operate the Tarong coal project in the South Burnett region of Queensland.

“Thiess is delighted to have the opportunity to continue our very positive and productive relationship with Tarong Energy,” chief executive Bruce Munro said in a statement.

Woodside $45 billion gas deal up in the air

A deal between Woodside Petroleum and China’s largest oil and gas distributor, PetroChina, worth $45 billion is in question after terms were not settled by a deadline.

An initial agreement set out in 2007 had a December 31 deadline to be settled, but no such settlement was made.

“The key terms agreement with PetroChina Co Ltd signed on September 6, 2007 for the potential sale of two-to-three million tonnes a year of LNG from the Browse LNG development expired on December 31, 2009,” Woodside told the ASX.

However, a spokesperson has said the 2007 agreement was only an initial deal.

Meanwhile, as reported in the Brisbane Times, the Kleenmaid brand may return to shelves due to a new company advised by one of the company’s former directors prepares for a roll-out of products.

Former director Andrew Young has met with a business partner in a Sydney private equity firm possibly interested in revitalising the brand. Compass Capital has said it hopes to work with Young in rolling out the new company, but that he owns no shares.

Centro Properties Group has now named current non-executive director Robert Tsenin as the company’s new chief executive and director, with the firm now focused on a restructuring plan.

“The board believes Robert has the requisite experience and knowledge of the group to provide the leadership essential for us to achieve our longer term goals,” chairman Paul Cooper said in a statement.

IMF January forecasts to be more positive

Overseas, a senior official at the International Monetary Fund has said forecasts due out this month will show “more upbeat expectations” for the world economy.

“These are not normal times, and the reasons for caution about the outlook remain powerful, pointing to a relatively modest recovery in the advanced economies,” he said in the blog, but also noted growth projections in emerging market countries are advancing.

In the US, Wall Street investors were given a boost of confidence after the Supply Management index of manufacturing activity grew by its fastest pace in nearly four years in December – a fifth consecutive month of expansion.

The index grew to 55.9 points, up from 53.6 in November. This sent to the Dow Jones Industrial Average up to a 15-month high, gaining 155 points or 1.5% to 10,583.96.