POLITICS & POLICY

Local stocks snapped a four day losing streak yesterday and our market has started off well again today, after US and European markets rallied on strong Chinese data and anticipation of more good news out of China today.

Finance Minister Penny Wong said on Friday that the Wednesday announcement by BHP Mitsubishi Alliance (BMA) that it would close its Norwich Park coking coal mine in Queensland is not an indicator of the state of the mining industry in Australia.

A proposed 3500-capacity National Convention Centre in Auckland is expected to draw more tourists to the city, generating significant revenues for the government, New Zealand Herald reports.

Bell FX Currency Outlook: Positive economic sentiment out of the US and China, coupled with strong domestic jobs data, has seen the AUD surge higher and open back above USD1.0400 this morning.

Strike one for Lynas opponents.Australian rare earths miner Lynas Corp., whose Lynas Advanced Materials Plant (LAMP) facility in Malaysia is almost complete but still unoperational, has scored a win against the locals who contested the authenticity of the rare earths temporary operating licence (TOL) issued by the country's Atomic Energy Licensing Board (AELB) in early February.

South Korean Defence Ministry spokesperson Kim Min-seok told reporters that North Korea's controversial and internationally-opposed rocket has been fired at 07:39 local time today, BBC reports. The National Disaster Risk Reduction Management Council (NDRRMC) had imposed "no fly, no sail, and no fishing" in Luzon Thursday, lifted it around 1 p.m. and place it back again on Friday.

The Dow Jones Industrial Average posted its biggest one-day surge in nearly a month after the New York Federal Reserve Bank's president reiterated that interest rates likely will remain low and traders took an optimistic view of global growth.

MORNING REPORT (7am AEST)US jobless claims rose by a surprising 13,000 to 380,000 last week - a two-month high. Economists had expected weekly claims to fall to 355,000. The US trade deficit shrank by 12.4pct to $46 billion in February, as exports hit a record high. It was the biggest monthly decline in the trade shortfall since May 2009.

Until the unemployment report came out on Thursday, economists and analysts were anticipating a larger cut on the overnight cash rate when the Reserve Bank of Australia meets in May. Their expectations range from 25 to 75 basis points rate cut.

The government was asking too much from the mining industry, according to leading resource players, as they scored a new federal regulation that require them to furnish information that would allow non-mining firms to capitalise too on the ongoing mining boom.

Yesterday the Australian share market sold off from the open and the All Ordinaries Index (XAO) closed down 46 points or 1.1pct. After a better night on overseas markets the Australian market opened 6 points higher this morning. The concerns over European growth were still around, but investors were happy to hear that the European Central Bank could extend its bond buying program if needed to stimulate the economies.

Acknowledging that the present aged care system badly needs overhaul, the federal government is mulling for ways to effectively address the problem without derailing its goal of realising a surplus by 2013.

Iran has announced a jump in its gold reserves allocation to 320 tons after a discovery of three new gold mines showed 16 tonnes of proven net gold reserves, the Fars News Agency reported on Wednesday.

In a bid to concentrate on the development of its Talisman Gold Mine Project near Waihi in New Zealand, Heritage Gold NZ has announced plans to break up the company into two separate entities, replacing its chairman and transfer non-core assets to a wholly-owned subsidiary.

Bell FX Currency Outlook: A turnaround in market sentiment overnight has seen the AUD rally to back above USD1.0300.

In response to complaints from businesses that their cost of compliance with environmental laws is going up, Australian Prime Minister Julia Gillard ordered on Thursday the streamlining of state and federal laws.

The Reserve Bank of Australia (RBA) is under pressure from unions and business groups to reduce the overnight cash rate when the policy board meets in May. RBA had keep interest rates at 4.25 per cent the past three meetings, but the big four instead increased their mortgage rates twice.

It was a tough start of the Australian share market. The All Ordinaries Index (XAO) opened 30 points lower after European and U.S. market slumped overnight. U.S. markets listed the worst trading day in 3 months, down for the 5th trading day in a row, as new concerns over European growth and a slowdown in internal Chinese growth hit the markets.

It is more prudent to save up now to prepare for the rainy days as the International Monetary Fund (IMF) predicted considerable slides in prices of commodities for financial year 2012-2013.

The Australian government said stopping a group of Chinese asylum seekers setting sail for New Zealand is not covered by its legal authority.

The Australian central bank has been fairly consistent on rolling out its rates policies but its decisions were not of any help to the local economy.

Overall outlook for iron ore consumption and trade continues to look bright even as Chinese demand for the raw commodity may wither in the next years.

A closer cooperation on infrastructure projects between Australia and China is expected to emerge from the newly-signed deal that governments of the two nations hope would further strengthen their trade relations despite the tensions that recently arose.

Developing economy India has forged a memorandum of understanding (MoU) with Afghanistan which outlines a cooperation for the development of the war-torn country's iron and steel sector.

Internship arrangements have reportedly been abused by many employers that the Fair Work Ombudsman has been prodded to look deeper into allegations that companies have been using the set-up to enjoy 'free services' from hapless workers.

Bell FX Currency Outlook: The AUD is lower this morning due to a drop in sentiment offshore, brought on by worries about Spain's economy and Friday's weak US non-farm payrolls data.

In US trade, markets declined in a decidedly risk-off session. A sharp rise in Spanish and other peripheral European sovereign debt yields dented investor confidence. The inability of Spain's fiscal austerity measures to alleviate the pressure in the bond market is worrisome, as Economy Minister Luis de Guindos declined to rule out a rescue for the country, and Bank of Spain Governor Mr Ordonez said Spanish lenders may require additional capital if the economy weakens more than expected.

US wholesale inventories rose by 0.9pct to $478.9 billion in February. The surge in inventories was largely driven by a rise in petroleum inventories which gained 3.9pct - the biggest increase in a year. US ICSC chain store sales rose by 4.1pct last week compared with a year ago. Same store sales are expected to rise between 3-4pct in April.

Less than three months before the Gillard government starts to collect the carbon tax on July 1, the measure continues to generate criticism from various sectors of Australian society. A tax expert questioned the carbon tax's constitutionality on Tuesday and charities warned on Wednesday of its impact on the services it provides poor people.