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Published on: Thursday, December 08, 2016

  • Treasurer Scott Morrison has said the fall in GDP was not just a wakeup call about national complacency over the economy, but represented a “demand” that Parliament supports reforms that stimulate investment, such as the proposed company tax cuts. Wednesday’s national accounts revealed that the economy shrank 0.5% in the September quarter – the first decline in growth since March 2011. However, Morrison says it would be alarmist to warn that the economy is headed for recession. Most analysts, along with the government, do not expect a consecutive quarter of lower GDP (which defines a technical recession). Read Peter Switzer’s article for what other economists had to say on the numbers.
  • Bunnings chief executive and MD John Gillam has announced that he’ll be stepping down after 12 years with the hardware chain. However, Gillam will continue to advise parent company Wesfarmers on asset sales, acquisitions, and the arrival of Amazon (AFR). “As well as providing ongoing advice and support to the business, Mr Gillam will continue to chair the Bunnings Group Council, which was set up at the time of the Homebase acquisition to coordinate Bunnings activity across all markets, and will also join the Bunnings United Kingdom and Ireland advisory board,” said a statement to the ASX. Wesfarmers shares last closed at $40.38.

Wesfarmers CEO Richard Goyder (centre), outgoing Bunnings boss John Gillam (left), and Target and Kmart boss Guy Russo (AAP)

  • IAG has announced an update on its strategy at an investor briefing. MD and CEO Peter Harmer revealed the company’s 3-5 year strategy aimed at driving customer and business benefits through two strategic themes: leading (putting customers first) and fuelling. As part of the strategic plan, the company aims to cut around $250 million in operating costs over the next three years. “Fuelling means making the necessary changes to the way we operate – simplifying processes and systems, and optimising resources to be more efficient so we can invest in leading,” Harmer said in a statement.
  • In US economic data, job openings fell from an upwardly revised 5.63 million to 5.534 million in October, according to the monthly Job Openings and Labour Turnover Survey (JOLTS report). According to Bloomberg, economists forecast job openings rose to 5.5 million. New mortgage applications fell 0.7% over the latest week, refinancings were down 0.7% and purchases were up 0.4%.  
  • At 0640 AEDT on Thursday, the local share price index was up 45 points, or 0.82 per cent, at 5,526.

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