Sydney, Dec 16, 2008 AEST (ABN Newswire) - US stocks fell overnight on the uncertainty of the US carmakers bailout and the lower US industrial production in November.

Yesterday, the Australian market closed higher as the miners surged on rising commodities prices offsetting the slump dragged by Telstra after the government ruled out the company from the tender list for bidding on the national broadband network. The benchmark S&P/ASX200 share index ended the day 2.3% higher, or 81 points, at 3591.4, while the broader All Ordinaries index rose 2.4%, or 83.2 points, to 3535.7. Traditionally the market would be quiet during this period with more focus on specific stocks rather than the market as a whole.

The Australian dollar has opened lower after failing to benefit from a further bout of US dollar weakness during offshore trading. At 0700 AEDT, the Australian dollar was trading at $US0.6645/50, down from Monday's close of $US0.6673/77.

The price of New York crude oil has soared above $US50 per barrel for the first time in two weeks as the market was driven by expectations that OPEC will cut crude output this week. Light sweet crude for delivery in January delivery fell almost two US dollars in overnight trade, settling down $US1.77 at $US44.51 per barrel.

Key Economic Facts and Figures

The Australian Bureau of Agricultural and Resource Economics has cut its forecast for earnings from commodities exports by 10 percent. Following substantial declines in minerals and energy prices, ABARE now expects resources and farm exports to be in the vicinity of A$192 billion in 2008-09, down from the previous forecast of A$214 billion. ABARE said resource exports, which it had expected to climb 53 per cent this financial year, should now climb by 37 per cent.
Australian Bureau of Statistics (ABS) figures issued on Monday show that the value of personal and commercial commitments fell in October. Lending for personal purposes fell 2.1 per cent in October, while commercial financing was three per cent lower for the month.

Today the Reserve Bank of Australia board minutes of its December 2 meeting are due for release, and the Australian Bureau of Statistics is to issue dwelling unit commencements data for September.

M&A News

The board of Perilya Ltd(ASX:PEM) urged shareholders to reject a hostile A$31.4 million all-scrip bid by fellow lead and zinc miner CBH Resources Ltd(ASX:CBH). Perilya said a merger with CBH was unattractive because it had too much debt.

The board of Asciano Ltd. (ASX:AIO) will meet to give first consideration to any offers received for a minority stake in its coal business. It is said that Asciano hopes a sale of the business could provide A$1.6 billion to A$2 billion to help pay down debt.

Important Corporate News

Manganese miner OM Holdings(ASX:OMH) has revealed it has suspended shipments at a loss of over A$12 million in response to weaker market conditions, which has also prompted a 30 per cent cut to annual production next year.

Rio Tinto(ASX:RIO) is rumoured to be in talks with banking advisers about the possibility of a $US9 billion rights issue in the first half of next year.

Australia's major banks were still in talks last night over Centro's(ASX:CNP) rescue plan. Centro Properties Group's deadline to pay back almost A$6 billion expired at midnight last night.

Builder and developer Lend Lease Corporation Ltd(ASX:LLC) has appointed its finance director, Steve McCann, as its new chief executive officer and group managing director. Mr McCann will take over from incumbent Greg Clarke early in 2009.

Macarthur Coal Ltd(ASX:MCC) has downgraded its first half profit guidance and says there is uncertainty about future coal demand. The company now expects profit in the range of A$75 million to A$125 million for the six months to December 2008, down from its previous guidance of a profit in the range of A$150 million to A$160 million, reaffirmed in November.

Macquarie Infrastructure Group (ASX:MIG) has cut the valuation of its toll roads by 24 per cent because of the dislocation in global economic and market conditions.

1. Related Stocks - Mid Market (AEST 1230)
---------------------------------------------------Code   % Change   Volume     Turnover    Low   High---------------------------------------------------ASX:RIO  -3.18   1,709,358   $68,670,762  3763  4161ASX:MIG  -7.03   3,346,425   $5,263,449   154   164ASX:MCC  -21.55  1,621,255   $4,523,209   268   287ASX:LLC  -4.6    305,444     $2,135,436   685   728ASX:AIO  +2.19   1,910,036   $2,658,663   134   142.5ASX:OMH  -6.11   356,169     $299,999     81    89ASX:PEM  -5.12   337,512     $59,373      17    19ASX:CBH  -7.89   644,000     $22,579      3.5   3.6
2. Top 10 ASX on Turnover - Mid Market (AEST 1230)
---------------------------------------------------Code   % Change   Volume     Turnover    Low   High---------------------------------------------------ASX:TLS  -5.75   114,639,215 $392,945,055 336   350ASX:BHP  -2.33   6,472,306   $199,802,198 3002  3172ASX:WBC  -.6     7,721,661   $127,576,677 1610  1638.5ASX:CBA  -.21    3,893,163   $110,074,243 2785  2842ASX:RIO  -3.33   1,709,638   $68,681,562  3763  4161ASX:ANZ  -2.2    4,593,939   $67,771,960  1460  1497ASX:CSL  +2.73   2,095,254   $58,945,613  2685  2915ASX:NAB  +.21    1,940,589   $37,779,953  1890  1939ASX:WPL  -2.67   1,005,661   $37,407,320  3377  3500ASX:QBE  +2.12   1,366,571   $33,605,027  2412  2503


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

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