insto - Australian financial markets

Investors face a raft of potentially market-moving domestic and offshore economic indicators this week.

Second-quarter GDP is due on Wednesday. The consensus market forecast is 0.9 percent in a range of 0.5 percent to 1.3 percent.

The GDP data will be foreshadowed by Tuesday’s Q2 current account balance, which is seen at a consensus deficit of A$16.6bn, in a range of –A$11.7bn to –A$5.0bn.

July dwelling approvals data are due on Tuesday as well. The market consensus is a fall of 0.7 percent in a range of minus 5.0 percent to 3.0 percent.

BHP Billiton reported an annual net profit of A$14 billion, its second highest on record, up 16 percent from the previous year, as Chinese growth spurred on renewed commodity demand. CEO Marius Kloppers, while cautious about global growth in the short-term, remained confident about long-term commodity prices, allocating a record A$17 billion for growth projects in the year ahead. “Given the volatile environment we’ve had over the last year, we consider these a very pleasing set of result,” he said.

Going to London to find work at a bank is no longer mission impossible. The UK economy may still be struggling, but financial services job vacancies are picking up, at least for now.
Compared with July 2009, there was a 71 per cent increase in new jobs in London’s financial district in July 2010, according to the most recent survey from recruitment firm Morgan McKinley.

National Wealth Management prices 5-year A$130m senior FRN

National Wealth Management has priced a A$130m senior FRN of its MTN program at 220 basis points over 3-month BBSW, lead manager NAB said. Details are as follows:

Issuer: National Wealth Management Holdings Limited
Rating: AA- (S&P)
Instrument: Floating Rate Notes
Issue amount: A$130 million
Coupon: 3 month BBSW +2.20%
Settle: 31 August 2010
Mature: 31 August 2015
Lead Manager: NAB
 

QBE has set its sights on growth through offshore acquisitions to improve returns and offset its low risk investment strategy, CEO Frank O’Halloran said this week.

QBE’s half year profits were down by 39 percent to US$440 million (A$490 million) following substantially smaller returns from its low risk cash and fixed income investment portfolio, the insurance company said.

BHP Billiton, the world’s largest mining company, made a hostile A$44 billion bid for Canadian fertilizer firm Potash Corporation, laying the foundations for what may become the biggest takeover of 2010. BHP is keen to expand into potash, a crucial ingredient to most fertilizers, with a successful bid transforming it into the market leader in the global fertilizer industry and diversifying its offerings beyond mining.

ANZ said it recorded unaudited underlying profits of A$3.6 billion for the nine months to June, up 26 percent for the corresponding period last year. This puts it on track to deliver earnings above A$4.5 billion for its 2010 financial year, ending September 30. CEO Mike Smith said that its core businesses were performing well against the backdrop of Australia’s “solid” economic performance, continuing Asian growth and the recovery in New Zealand.

Can banks evolve with their customers? By Pascal Gautheron, managing director of Accenture’s banking practice in Asia Pacific.

The QR National IPO is one of the market’s big hopes of 2010. As James Brooks reports, the float is still on track for Q4.

In early July, key participants in Australia’s syndicated loans market gathered for a roundtable in the Sydney offices of law firm Blake Dawson. Here is an edited transcript of the discussion, moderated by Insto editor Lachlan Colquhoun.