Business Markets

It’s not just the online bookies who have seen their clients gamble on a Coalition win in the drawn out federal election, the Australian stock market seems to taking the same punt.

Gresham Advisory Partners has flagged the rise of domestic-focused miners – up 20 per cent in market value in the past month – as a market signal that that Mineral Resources Rent Tax unlikely to become law any time soon.

Given the MRRT is a Labor proposal and that their parliamentary ally, the Greens, want to see an even tougher tax regime for miners, it seems that share market investors are leaning towards Tony Abbott being installed as Australia’s next Prime Minister.

The would put the market in line with Centrebet which has Mr Abbott on $1.50 to become Prime Minister, shorter odds that Labor’s Julia Gillard on $2.50.

To further highlight that view, Centrebet has Bill Shorten as more likely to be Labor’s leader at the next federal election.

The Gresham view was published today in its review for August of its Group 150, the top 150 ASX listed resources companies, excluding oil and gas, by market capitalisation for the month to the end of August.

“While the outcome is yet to be determined, we expect that the market is increasingly assuming that the MRRT, as presently conceived, is unlikely to see the light of day, at least for the next term of parliament,” Gresham said.

The MRRT was announced in early July by Ms Gillard, replacing the heavier taxation burden of the Resources Super Profits Tax proposed in early May by then Prime Minister Kevin Rudd.

The MRRT was limited to coal and iron ore while onshore gas projects were to be embraced by the existing petroleum tax regime.

“The average market value of domestic focussed companies since the proposed MRRT was announced has increased 20 per cent (15.4 per cent July).”

“International focused companies increased 14.1 per cent (7.6 per cent in July).”

AUSTRALIAN businesses enjoyed a record profit surge in the latest quarter, with mining profits ballooning by nearly two-thirds, thanks to soaring commodities prices.

Profits across all industries leapt by 19 per cent to $68 billion in the three months to June, the Bureau of Statistics said yesterday.

Driving the increase was a 63 per cent explosion in miners’ earnings, which struck $25 billion after contract prices for iron ore and coal were upgraded sharply.

The jump in miners’ income also came as the industry mounted its fierce campaign against a ”super profits” tax designed to capture the windfall flowing to the sector.

The other big winners were in construction, where profits rose 30 per cent, and financial services, which grew by 29 per cent.

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Personal income was flat in June but could have risen by 0.3% mom in July: nonfarm payrolls declined again due to the loss of temporary Census jobs, but aggregate working hours increased by 0.4% mom and average hourly earnings went up by 0.2% mom. Personal spending which had merely remained stable in June, is likely to have risen by about 0.3% mom in July too. Retail sales went up by 0.4% mom, although this was only due to higher adjusted gasoline prices and car purchases.

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Australian businesses are reporting higher revenues than last year, and are expecting revenue to continue to rise, a new MYOB report has found.

MYOB Business Monitor, conducted by business management solutions company MYOB, which found that 74 percent of businesses reported revenue levels at the same or higher levels than a year ago. A further 47 percent of businesses reported they expect their revenue to increase even further in the next 12 months, with 49 percent indicating that they have more work than usual lined up over the next three months.

The findings of this report show that business is picking up in the wake of the GFC, according to CEO of MYOB Tim Reed.

“These results clearly indicate that the engine room of the Australian economy has survived the GFC and is now picking up speed. W

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Legal entrepreneur Jeremy Szwider is the brainchild behind the innovative Bespoke Law. With global headquarters in Melbourne, this is the first virtual law firm of its kind to hit Australian shores.

Bespoke Law provides a platform for a new third tier of the legal profession. Without real overheads, it operates as an “outsourced extension” to in-house legal departments and business units. It does this via an Outsourced In-House Counsel service and alternative fee arrangements. Wit

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