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Published on: Wednesday, December 14, 2016

  • The major US indexes have continued their rally, hitting new all-time record highs as the US Federal Reserve kicked off its two-day FOMC meeting. The Dow Jones rose 115 points or 0.6%, the S&P index rose 14.8 points or 0.7%, and the NASDAQ rose 51 points or 1%. The Dow Jones has now climbed almost 9% since the November 8 election on the back of president-elect Donald Trump’s expected stimulus measures and lowered taxes and regulations. Eight of the 11 major S&P sectors were higher – and the technology index rose by 1.6%.
  • Treasurer Scott Morrison is expected to issue an appeal for the country’s AAA credit rating, by explaining the government is exceeding agencies’ demands on budget repair. In a speech today, Morrison will urge the agencies to consider that a large amount of foreign debt is vital for the country’s prosperity. Ahead of next week’s mid-year budget update  - which could see the nation lose its AAA rating - Morrison will also flag higher foreign debt (through infrastructure borrowing and other productivity enhancing investment), but only after “bad-debt” is controlled (AFR).


  • Outdoor advertising company APN Outdoor Group (APN) and oOh!Media (OML) have announced that they will be merging to create a “leading, diversified out-of-home and digital media group in Australia and New Zealand with a pro forma market capitalisation of approximately $1.6 billion”. OML shareholders will receive 0.83 APN shares for every OML share held. On completion of the transaction, existing APN and OML shareholders will own 55% and 45% respectively of the merged group. Both companies will cap final dividends for the year (ending December 31) at 12.5 cents and 10 cents per share respectively as part of the transaction. OML shareholders will be able to vote on the Scheme at a meeting expected to be held in March 2017.
  • The Commonwealth Bank will raise its standard variable investor loan rates by seven basis points to 5.56%, effective this Friday, December 16. Its owner-occupier rates will remain unchanged. The move follows earlier raises to the lender's two, three and five-year fixed-rate owner-occupier and investor loans on December 2. Rates for the bank’s line of credit loans will rise 15 basis points to 5.78%. “These changes balance the needs of our borrowers and shareholders, while helping to underpin the long-term sustainability of the Australian home loan market, CBA retail banking group executive, Matt Comyn, said. 
  • At 0645 AEDT on Wednesday, the local share price index was up 35 points, or 0.63 per cent, at 5,585.

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