Sydney, July 16, 2007 (ABN Newswire) - Australian shares rose slightly this morning after data showing improving consumer sentiment in the U.S. buoyed stocks with U.S. dollar earnings, while mining firms such as Alumina continued to rise on takeover hopes.
At Midday the ASX200 index has added 19 points to 6,408 and on the futures market the SPI 200's up 15.
Shares in Rio Tinto have fallen again this morning, adding to a 2.5 percent decline on Friday on concerns that it was paying a full price for Alcan. Rio said it would pay US$101 a share to create the world's largest aluminium producer, trumping a US$29 billion hostile bid by Alcoa. Citigroup downgraded its rating on Rio to hold from buy, saying that the Alcan acquisition appeared to be fully priced and only marginally earnings accretive. Rio's main rival, BHP Billiton , which has been rumoured to be eyeing U.S. aluminium maker Alcoa, was also tracking lower in morning trade after analysts warned BHP's possible competitive response to the Rio Tinto's takeover of Alcan would push the mining giant into an extreme anti-competition row with regulators world-wide. Rio Tinto shares have fallen 3.14% to $98.12, and shares in BHP have dropped 0.64% to $38.91
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