Unemployment remains steady at 5.1%, Shares jump: Economy roundup

The unemployment rate remained steady at a seasonally adjusted 5.1% during June, according to the latest data from the Australian Bureau of Statistics.

The figure, which is the lowest in 18 months, comes after the ABS revised May’s unemployment rate to 5.1% from a previously reported 5.2%.

The ABS reported employment increased to 11,077,600, with unemployment decreasing to 603,400. The participation rate was at 65.1%, while aggregate monthly hours worked increased to 1.56 billion.

Full-time employment increased by 18,400 to 7.79 million, while part-time employment increased by 27,500 to 3,306,000. Meanwhile, unemployment decreased by 200 to 598,400, with the number of persons looking for full-time work decreasing by 11,000 to 424,700.

Meanwhile, Australian shares have risen over 2% due to solid leads on Wall Street, where stocks rose over 2.8% after State Street Corp announced a particularly optimistic forecast ahead of the reporting season.

The data comes as jobs website Seek announced ads rose 2.3% in June, representing a total increase of 40% over the year to 30 June.

“June’s figures demonstrate continued movement in the right direction and clearly show that, after a period of rapid recovery during 2009, the jobs market has settled into a pattern of sustained steady growth,” managing director Joe Powell said in a statement.

The benchmark S&P/ASX200 index was up 93 points or 2.19% to 4347.9 at 12.10 AEST, while the Australian dollar also increased to US87 following the labour force data announcement.

ANZ shares have risen 3.8% to $22.03, while Commonwealth Bank shares gained 3% to $49.71. Westpac rose 3% to $21.89 as NAB gained 3% to $22.79.

Meanwhile, 99% of proxy votes have been reportedly cast in favour of the demerger of Dulux paint from Orica group.

As reported by Reuters, Orica shareholders are meeting in Melbourne to discuss the arrangement. It is understood just under 99% were in favour of the demerger.

ACCC delays BHP, Rio ruling again

The Australian Competition and Consumer Commission has once again delayed its decision on the $US116 proposed joint venture between iron ore giants BHP Billiton and Rio Tinto.

ACCC chairman Graeme Samuel said last month the competition watchdog would release its decision on 22 July, but a new statement suggests the ruling has been suspended “at the request of the joint venture parties to allow them to make additional submissions to the ACCC”.

Some analysts have suggested the Australian competition approval will be easier to obtain than in Europe, where regulators may be tougher on the deal. It is understood second-tier miners have expressed competition concerns regarding movements in iron ore prices as a result of the deal.

Property group Lend Lease has now finalised the terms for its European subsidiary to commence a $2.7 project to regenerate the Elephant & Castle area.

“Outline planning for the masterplan along with detailed planning for the first phase is anticipated in 2011 with work on site anticipated to commence in 2014,” Lend Lease said in a statement.

The company will provide investment and development management services as part of the project.

Meanwhile, building materials manufacturer CSR has said the sustainability of longer-term housing starts remains uncertain, at a time when commercial construction has failed to pick up pace.

“Commercial construction activity continues to be weak,” chief executive Jeremy Sutcliffe reportedly told shareholders at a meeting today.

“Commodity prices, including aluminium, continue to fluctuate, which CSR attempts to mitigate through hedging of the physical commodity and currency where commercially practicable,” he said.

Additionally, he said that earnings in the Sucrogen sugar division will be subject to weather and other variables. “While CSR remains subject to the knock on effects of the global economy, we are confident of optimising our assets as best as we can.”

 Prime Minister Julia Gillard has ruled out any carbon price trading before 2012, she told ABC Television last night.

“I am holding to the decision that was announced by the government that we will review in 2012 the nature of the community consensus in Australia about the Carbon Pollution Reduction Scheme,” Gillard said yesterday. 

“The announcements of the former Prime Minister Kevin Rudd about the Carbon Pollution Reduction Scheme stand.”

Cooper defends MySuper recommendation

Jeremy Cooper has defended his recommendation the Federal Government introduce a low-cost default super account. He has addressed some criticisms the recommendation is “paternalistic”.

“It’s acutely paternalistic – it’s saying that if we don’t force Australians to defer some of their wages and salary and put them away for a time, they’re simply not going to save, so we’ll force them, and so that’s how we have to see the system.”

Meanwhile, Germany has agreed to a plan to cut its deficit over the next four years, with finance minister Wolfgang Schaeuble saying Germany is now on track to cut its deficit below 3% of GDP by 2013.

“Those who doubted the seriousness of this plan have to take these figures into account,” he told a news conference.

This news was greeted with optimism in the US, where stocks rose over 2.8% due to some preliminary positive forecasts ahead of the earnings reporting season. The Dow Jones Industrial Average gained 274.66 points or 2.82% To 10,018.28.

Jeremy Cooper, Labour Force, Cooper, MySuper, Seek, Economy, Finance