THE NEWS WRAP: Fortescue expects demand from China to underpin iron ore price
Fortescue Metals Group chief executive Nev Power predicts growing demand from China will lead the iron ore price to settle at about $120 a tonne for the rest of 2013, albeit with some volatility.
Power says the Chinese Communist Party’s plan to double China’s GDP between 2010 and 2020 will provide an underlying growth rate of around 8% per year, leading to strong infrastructure spending as urbanisation continued.
The mining giant also revealed it plans to release a shortlist of possible buyers for a minority stake in its Pilbara infrastructure assets by the end of next month.
US jobless claims at lowest levels since 2008
New jobless claims have fallen for the second consecutive week in the US, according to new figures from the US Labor Department.
The figures show initial claims for unemployment insurance benefits falling to 330,000 for the week ending January 19, down 5,000 from the previous week’s figures, representing the lowest levels since early March 2008.
The four-week moving average also fell for the second consecutive week to 351,750, well down from the 370,000 range the figures trended at for most of 2012.
Equity-based Crown takeover of Echo Entertainment increasingly likely: Deutsche Bank
New figures compiled by Deutsche Bank show that an equity-based takeover of casino operator Echo Entertainment could be an increasingly attractive option for James Packer’s Crown.
According to figures compiled by the bank, Crown shares have outperformed Echo’s by 56% over the past six months, meaning an equity component in any takeover bid would potentially be far more palatable to Packer than it was in the middle of last year.
Figures show that if Crown were to buy Echo shares at a 20% premium to current market prices, funded by an equal mix of debt and equity, Packer’s stake in Crown would be reduced from over 50% to 39.4%.
The Dow Jones Industrial Average added 0.4% to 13,834.02. The Aussie dollar is down to US104.71 cents.