Sydney, Nov 17, 2008 AEST (ABN Newswire) - Wall Street slumped on Friday with hedge fund selling in advance of a Saturday deadline. On Friday, the Australian sharemarket reversed its sharp losses of mid week to close up over one per cent following a strong US lead and higher base metals prices. As the G-20 leaders failed to come up with specific stimulus action after their weekend meeting in Washington, analysts expect the market volatility to continue but it would be getting close to the bottom.

Last Friday the benchmark S&P/ASX200 index was up 50.8 points, or 1.37 per cent, at 3,748.1, while the broader All Ordinaries index had risen 53.6 points, or 1.46 per cent, to 3,726.0.

At 0736 AEDT, the December Share Price Index futures contract on the Sydney Futures Exchange was down 64 points at 3,693.

The Australian dollar opened weaker as a record fall in US retail sales and data showing Europe in recession reminded traders a prolonged world economic slowdown was on the way, hitting growth-sensitive currencies. At 0700 AEDT, the Australian dollar was trading at $US0.6455/64, down 1.01 US cents, or 1.5 per cent, from Friday's close of $US0.6558/63.

Oil prices closed mixed Friday amid growing signs of economic trouble in the US and Europe, despite the possibility of a new output cut from an OPEC meeting later this month. On the New York Mercantile Exchange, light sweet crude for December delivery fell $1.20 a barrel to close at $57.04.

Key Economic Facts and Figures

Prime Minister Kevin Rudd met Chinese president Hu Jintao for an hour-long discussion in Washington yesterday. Australia and China will move to further speed up negotiations on a free trade deal but they haven't set a deadline to reach a final agreement. "We are confident that we can get real progress in the period ahead," Mr Rudd said.

World leaders have agreed on an action plan to restore global growth and prevent future financial upheaval at the G20 summit in Washington, promising spending plans, a trade deal and reforms. The G20 meeting failed to improve market sentiment, as world leaders deferred key decisions until the next meeting scheduled for April 30.

Today the Australian Bureau of Statistics (ABS) releases its retail trade data for the September quarter.

The Australian Industry Group/American Express survey on Managing Cash Flow in Troubled Times report comes out today.

M&A News

Babcock & Brown (ASX:BNB) has sold wind farm assets held by B&B Wind Partners in Portugal for A$2.23 billion. The assets were sold to a consortium of investors led by Magnum Capital. Magnum and its partners are investing 1.2 billion euros for the 515 megawatts of wind assets in operation and the 156 megawatts of assets under construction in Portugal.

Lion Nathan(ASX:LNN), Australia's second largest brewer, has made an offer for Coca Cola Amatil (CCA) that values the drinks maker at around A$7.61 billion. CCA said it has been in talks with Lion and the proposal, received on November 7, was "incomplete and non-binding".

It is rumoured that China Investment Corp is back in talks about a minority stake in Fortescue Metals Group(ASX:FMG). Last week Fortescue said demand for its product remains strong and its customer relationships are robust amid a downturn in China.

Important Corporate News

BHP Billiton(ASX:BHP) has admitted its iron ore shipments could fall by as much as 28 per cent during the final two months of the year because difficulties in obtaining credit has forced some steel mills to postpone deliveries. The company said the miner still had no plans to cut production, but up to 6 million tonnes of shipments.

Building materials group James Hardie(ASX:JHX) has reported a fall in first half operating profit and declined to pay an interim dividend due to the uncertain conditions in the construction market. Net operating profit, excluding asbestos liabilities, legal expenses and tax adjustments, fell 36 per cent to $US76.2 million in the half, from the same period in the previous year.

The Al Habtoor - Murray and Roberts Joint Venture has been awarded an AED 3 billion contract for the design and construction of the new Zayed University campus in Abu Dhabi for Mubadala Development Company (Mubadala). The affiliate of Leighton Group(ASX:LEI) Al Habtoor Leighton's share is AED 1.5 billion.

1. Related Stocks - Mid Market (AEST 1230)
Code   % Change   Volume     Turnover      Low  High
ASX:BNB  -15.62  4,524,050  $1,904,870    38    46
ASX:LNN  -1.56   380,359    $3,396,697    875   920
ASX:FMG  -3.68   3,469,370  $6,400,818    181   189
ASX:BHP  -3.82   6,530,511  $167,038,587  2493  2558
ASX:JHX  -5.68   272,885    $1,190,850    408   464
ASX:LEI  -4.91   356,118    $8,562,432    2365  2509
2. Top 10 ASX on Turnover - Mid Market (AEST 1230)
Code   % Change   Volume     Turnover      Low  High
ASX:BHP  -3.78   6,531,722  $167,069,351  2493  2558
ASX:NAB  -4.34   7,511,829  $147,250,784  1821  1950
ASX:CBA  -2.74   3,914,938  $129,263,794  2992  3179
ASX:WBC  -1.84   5,235,789  $86,789,622   1603  1659
ASX:ANZ  -2.53   5,435,462  $75,899,380   1307  1388
ASX:RIO  +.02    831,122    $60,344,528   6980  7226
ASX:QGC          8,219,297  $47,223,471   575   576
ASX:TLS  -.93    8,189,018  $34,490,552   418   425
ASX:MQG  -7.17   1,557,171  $32,224,058   2008  2210


Michelle Liang
Asia Business News Asia Bureau
Tel: +61-2-9247-4344

Related Companies

Lion Nathan Limited        
James Hardie Industries N.V.        
Fortescue Metals Group Ltd          
Cimic Group Ltd          
BHP Billiton Limited          
Babcock & Brown Limited        

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