Business confidence falls on economic woes, ACCI report shows
Business and investor confidence fell slightly in the December quarter with most indicators falling below five year averages, a new survey released by the Australian Chamber of Commerce and Industry has revealed.
Some indicators have deteriorated due to financial troubles in Europe, China, and weakness in a number of industries in Australia outside the mining boom.
The index for current business conditions remained flat at 48.2, its lowest level since 1998 and eight points below the average. Expected conditions rose slightly.
The index for current sales remained flat at 47.1, while expect sales grew from 47.6 to 49.4.
A measure below 50 indicates conditions are deteroriating, while a measure above 50 suggests conditions are improving.
Profitability increased from a record low to 43.7, although it remains six points below the five year average. The index for the expected level of full-time employees fell from 44.5 to 43.5, 5.9 points below the average.
National economic conditions remained unchanged at 44.7, while expected conditions fell to 44.5 from 46.1.
And the labour market is expected to soften more, with the expected unemployment rate rose to 61.4 from 60.9 points.
Overall, ACCI said in the report it shows most businesses are still concerned about the "underlying weakness" in Australian non-mining industries.
Australian stocks slightly higher
The Australian sharemarket is slightly higher this morning, with the S&P/ASX200 up 16.6 points or 0.4% to 4241.7 at 12.15 AEST, while the Australian dollar also rose higher to $US1.05c.
All the top-ten shares were up, except for AMP which fell 0.23% to $4.26.
Leading the market were energy and gold stocks.
White Energy Company jumped 5.66%, while Paladin Energy rose 3.97%.Gold miner St Barbara had a good morning, trading 4.27% higher.
Costello warns Government to stop spending
Former federal treasurer Peter Costello has warned the Government to slash spending or else face some of the financial turmoil occurring in Europe.
"Europe at the moment is suffering under a mountain of debt that it can't service," he told Macquarie Radio.
"If the journey keeps continuing at the rate in the years ahead that it did in the last three or four years it won't be too long before we start experiencing European-type problems.
"This is a realisation that I don't think Julia Gillard has yet to come to grips with and I don't think the government has come to grips with."
While Costello said the post-war manufacturing boom was powered by cheap energy, he warns the carbon tax could change the nature of local manufacturing.
"If all we have got is government debt then we would have completely wasted this," he said, referring to the mining boom.
Financial advice industry comes out against FOFA reforms
The Federal Government's overhaul of the financial advice industry could see 35,000 financial advisors and support staff leaving the industry, according to the Association of Financial Advisors.
The dire claim was made by the body's chief executive Richard Kliplin yesterday at the Parliamentary Joint Committee into the Future of Financial Advice legislation.
The two- day hearing began with unexpected with Craig Meller from AMP coming out against the detail of the legislation, as the large body had previously supported the reforms.
He said the legislation went beyond the government's intent, and many clauses of the bill were inconsistent with the explanatory memorandum.
Chief executive of the Financial Services Council John Brogden told the ten-member parliamentary committee that the changes would cost the industry $700 million in the first year, and a further $375 million every year after that.
FWA approves deal between Qantas and its engineers
Fair Work Australia has endorsed a three-year deal between Qantas and its engineers union.
The agreement, struck just before Christmas but approved today, locks in base pay increases of 3% a year, and in a victory for Qantas, excludes some of the Australian Licensed Aircraft Engineers Association's more expensive claims, including a push for a new hanger and expanded job security protection.
The deal should save the airline from 3 years of industrial action by its engineers, as the agreement will last until the end of 2014.
Qantas CEO Alan Joyce welcomed the decision, describing it as a "relief" after "such a damaging industrial campaign." He said the ruling did not include "any of the restrictive demands" the airline faced when he grounded it in October.
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