Newcrest Mining cuts spending ahead of job losses, construction sector enters third year of contraction: Midday Roundup

Newcrest Mining signalled this morning possible job cuts as it slashes spending, with the company cutting capital spending in the 2014 financial year to $1 billion.

The miner announced this morning the downgrade on its spending from the previous $1.5 billion, as it’s almost halved its exploration spending, reducing it to only $85 million.

Newcrest’s spending cuts come as it prepares to cut jobs and reduce corporate costs by at least 20% as it closes its Brisbane office.

Chief executive Greg Robinson said the announcement was a “very dramatic” move in reaction to market conditions.

“Overall our strategy is maintained, although short term we are tactically reacting to these lower prices. We will continue to have an unhedged revenue stream.”

Shares in the mining company were down 8.72% just after midday.

Construction sector enters third year of contraction

May marked the third consecutive year of decline for the construction industry, despite rises in input prices and wages.

New figures released from the Australian Industry Group’s monthly Performance of Construction Index found the sector remained “broadly unchanged” in May with a rating of 35.3 on the index, with ratings below 50 indicating contraction.

Despite the overall contraction, input prices and wages increased, with ratings of 73.4 and 55.9 respectively.

The housing sector dropped on the index for the third consecutive month to 30.4, with the sharpest rate of contraction in eight months.

Sharemarket continues to fall

The Australian sharemarket has opened weaker today, continuing a fall that has seen more than $100 billion wiped off the market in the past two weeks.

The benchmark S&P/ASX200 index was down 48 points or 1% to 4732.3 at 12.10 AEST, while in the United States the Dow Jones Industrial Average rose 80 points or 0.5% to 15,040.6.

The Australian dollar has also risen slightly this morning, moving to US95c after dropping to US94c overnight.