Housing starts plunge despite rate cuts: Midday roundup

Housing starts fell more than expected in the March quarter, according to data from the Australian Bureau of Statistics. The data showed total starts fell a seasonally adjusted 12.6% in the three months to March 31, to 30,623 units.

The result came after a upwardly revised fall of 4.5% in the December quarter and despite two rate cuts by the Reserve Bank at the start of they year

CommSec analysts had expected a 1.5 per cent fall in new home starts during the quarter.

News Corp unveils $2 billion takeover while poised to axe jobs

News Corporation has made a takeover offer for Consolidated Media Holdings offering a price of $3.50 a share.

If accepted, the deal would have major ramifications for the Australian media industry with News set to double its stake in Fox Sports Australia and Foxtel to 100% and 50% respectively.

The price values Consolidated Media at a total of around $1.97billion.

The offer is subject to a number of conditions, including clearance from News Corporation, the Foreign Investment Review Board and the Australian Competition and Consumer Commission.

News’ takeover bid comes on the same day that the media company is expected to announce massive jobs cuts.

An announcement is expected in the early afternoon and may involve up to 1,000 jobs.

Australian dollar hits six-week high

The Australian dollar has hit a six-week high as traders await the outcome of the two-day US Federal Reserve meeting.

The Fed is discussing putting more stimulus into the American economy, which in the past has put downward pressure on the US dollar.

At 11.30am (AEST), the local unit was trading at US101.78 cents, up from 101.26 cents on Tuesday.

Early on Wednesday, it hit US102.03 cents, its highest level since May 8.

In an economic report this morning ANZ said that a weaker US dollar had benefited “high beta” currencies such as the Australian Dollar while “not-so-dovish” minutes from the Reserve Bank released yesterday also underpinned the Australian dollar.

Stockmarkets open higher

The Australian stock market opened higher after Wall Street enjoyed a solid session on speculation the Federal Reserve will act to stimulate the US economy.

At the official market opening, the benchmark S&P/ASX 200 index rose 0.78% to 4,155.5 points, while the broader All Ordinaries Index grew 0.75% to 4,199 points.

Media stocks dominated news in early trade, after News Corporation’s takeover bid and Fairfax shares rising on the back of Fairfax directors demanding Gina Rinehart agree to certain conditions before taking a seat on the board.