Fortescue shares placed in trading halt

Fortescue Metals Group shares have been placed in a trading halt amid reports the company has requested a waiver on its debt commitments.

The reports sent the company’s shares plummeting more than 13% yesterday.

Fortescue said in a statement today it had requested the halt due to concerns about “continued rumours and speculation”.

“Discussions with its banks have progressed significantly overnight and it is in the best interests of shareholders to halt trading in Fortescue’s securities,” the company said.

“Fortescue re-iterates its announcement from yesterday that it is in compliance with its banking covenants and is conducting discussions with its supportive banking group.”

Fortescue expects to make an announcement regarding a restructure before September 18.

US central bank embarks on stimulus program

The United States’ Federal Reserve has announced it will buy $US40 billion worth of mortgage-backed debt every month until employment improves.

The third round of quantitative easing will last until at least the end of the year. However, chairman Ben Bernanke said there was no target in mind.

“We’re looking for ongoing, sustained improvement in the labour market. There’s not a specific number we have in mind. What we’ve seen in the last six months isn’t it.”

This comes just after the European Central Bank embarked on a similar program to boost consumer confidence and employment.

Australian stock market jumps 1% on the back of US stimulus

The Australian stock market opened over 1% stronger on the back of the Federal Reserve’s stimulus announcement.

At the official market open, the benchmark S&P/ASX 200 index gained 1.09% to 4386.9 points, while the broader All Ordinaries index jumped 1.05% to 4,4405.5 points.

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