Activity in the construction sector contracted to a 13-month low with a lack of housing construction negating improvements in the commercial and engineering sectors, the new AIG-HIA construction survey reveals.
The overall construction index fell by 0.1 points to a 13-month low of 43.2, below the 50-point level separating expansion from contraction.
“Rising interest rates earlier in the year played a role in dampening demand, while the on-going lack of available finance for development is showing no material sign of improvement and is a major obstacle to a sustained recovery,” HIA chief economist Harley Dale said in a statement.
However, there were some signs of improvement. The index of apartment building grew by 2.5 points to 47.6, with engineering increasing 4.1 points to 40.3. Commercial property grew 7.6 points to 42.9 while the index of new orders grew 0.5 points to 43.5.
Woolworths has hit a roadblock in its plan to purchase 150 new property sites for its hardware chain, with Victorian planning minister Justin Madden rejecting a combined permit application for a store in North Geelong.
The decision was based on the findings of an independent committee, with the rejection the first of eleven assessments to take place.
“Woolworths is disappointed to no longer have the opportunity to locate a home improvement store on this particular site in Geelong, but respects the process undertaken by the Independent Advisory Panel to reach its decision,” a spokeswoman for Woolworths told Fairfax.
In February the Victorian government appointed the advisory committee to consider the suitability of 11 sites chosen by Woolworths for its new hardware venture with US giant Lowes in an attempt to help fast track the process in the state.
”The advisory committee found that this development was not consistent with the City of Greater Geelong’s strategic direction and did not adequately address issues such as urban context, equitable access, public amenity and environmental sustainability,” Madden said in an official statement.
Meanwhile, Domino’s Pizza has released a statement saying it has no plans to acquire the Crust Pizza chain.
“Domino’s Pizza Enterprises would like to confirm it has no intention to purchase Crust Pizza…recent speculation about DMP being in negotiations with Crust Pizza is unfounded and incorrect,” chief executive Don Meij said in a statement.
The Australian sharemarket has opened flat today, with no leads from Wall Street due to the Labor Day public holiday and uncertain markets back home as investors await another interest rate decision from the RBA.
The benchmark S&P/ASX200 index was up two points or 0.06% to 4578.4 at 12.20 AEST, while the Australian dollar was also up slightly higher to US91c.
ANZ shares gained 0.9% to $23.88, while Commonwealth Bank shares rose 0.5% to $52.37. Westpac rose 0.9% to $22.99 as AMP rose 0.8% to $5.10.
Fitch Ratings has announced its support for the MySuper superannuation accounts proposed by the Cooper Review, saying such accounts would allow funds to become more competitive and profitable.
“The continued strong growth of managed funds and potentially a stronger competitive position against industry funds could lessen the earnings strain,” the agency said in a statement.
AWB has said drought in Russia and current weather damage in Europe has increased interest for Australian wheat products.
“The interest is helping to generate better physical prices for Australian wheat on top of the general improvement in world prices,” general manager of commodities Mitch Morison said in a statement.
“So we are in a strong position talking to customers about shipments both in bulk and containers.”
Westpac has appointed general manager of pacific banking Jane Kittel as the new managing director of the BankSA business.
“Jane is one of our most experienced general managers and has successfully managed our banks in the Pacific through the volatile period of the last few years,” Westpac chief executive Gail Kelly said in a statement.
“I grew up in South Australia and I’m absolutely delighted to have the opportunity and responsibility of running such an icon in the state.”
As reported by The Australian, Leighton Holdings is preparing to announce an ending date for Wal King’s reign as chief executive.
Several sources have revealed the company will either name David Savage or David Saxelby as King’s replacement. It is understood he will step down from his role sometime before the end of the year.
British Airways chief executive Willie Walsh has told the Australian Financial Review the company is eager to merge with Qantas.
“Qantas is a very strong global airline with a great brand, but I’m not sure that they share our view on consolidation at this point,” he said.
“We’ve done the work in our discussions with them two years ago and we know there’s a strong case there – it’s definitely something that would be interesting in the future if Qantas were like-minded.
“I don’t see any evidence of Alan [Joyce] wanting to pursue that at this stage, but that may change.”
However, Qantas head of corporate affairs David Epstein told The Australian no discussions have taken place.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
