5 things you need to know today
Published on: Tuesday, November 29, 2016
- The Organisation for Economic Co-operation and Development (OECD) expects the Australian economy will grow below three per cent until 2018 but has urged the Reserve Bank of Australia (RBA) to raise the cash rate in late 2017. A rate hike will unwind house prices and other financial distortions which have been spurred on by the low-rate environment. The OECD also said that in the face of disappointing economic growth, the government should look to fiscal policy to support the economy. “There is already fiscal space to respond to an unanticipated downturn in activity,” it said.
- Global oil prices had a volatile session on Monday but clawed back earlier losses. The markets continue to react to the uncertainty of whether the major oil producers will agree on output cuts at the OPEC meeting on November 30. Iraq suggested it would coorporate in an agreement to trim output at the meeting which supported prices. Brent crude rose $US1 or 2.1% to $US48.24 per barrel. Prices are expected to remain volatile until OPEC’s meeting provides a clear picture on whether OPEC and non-OPEC producers can agree on cuts.
- Telecommunications firm Vocus has flagged a full-year underlying net profit of between $205 million and $215 million. In a statement to the ASX, the company said that the FY17 result is expected to be skewed to the second half. “The Board expects to increase dividends in line with the growth of the business, taking into account the capital requirements and accretive opportunities in the M&A and further infrastructure projects.” Vocus will hold its AGM today at 11am.
- Investors and analysts have downplayed the prospects of a $5 billion takeover bid by Ladbrokes Coral for Tabcorp – a potential threat to Tabcorp’s $11.3 billion merger with rival Tatts. The news pushed Tabcorp shares almost 2% higher yesterday to $4.71. Citi analysts said a bid from Ladbrokes would be “a relatively difficult bite for Ladbrokes given the size of the deal – Tabcorp’s market cap of $3.9bn versus Ladbrokes’ $4bn and given Ladbrokes only just closed on the purchase of UK gaming company Gala Coral” (The Australian).
- At 0645 AEDT on Tuesday, the share price index was up six points at 5,478.