International Share Market Volatility - Talking Business 2011 Ep 28c

A review of the week in business, with expert analysis and commentary.

Leon and Garry talk about the share market’s volatility, both here and around the world. Future Fund chairman David Murray says it will be volatile for the next 20 years. Volatile times too for the Australian dollar. The Federal Government faces an uphill battle to bring the budget back into surplus. Superannuation managers still have more than half of their funds in shares. The NAB business survey shows trading conditions have deteriorated. Australia's unemployment rate surges to an eight-month high of 5.1 per cent and job advertisements decline 0.7 per cent in July. Consumer confidence falls for a fourth straight month in August to hit a 27-month low. Markets bet that interest rates could be cut. The International Monetary Fund says Australia is well positioned to handle a severe global financial market disruption and can cut interest rates. Treasurer Wayne Swan is briefed by US treasury secretary Tim Geithner on US economic problems. Margin calls sparked by Australia's five-day share rout surge to levels not seen since the global financial crisis. The number of home loans approved in June rises slightly. BIS Shrapnel expects national building starts will recover by 8 per cent in 2011-12. National Australia Bank records quarterly cash earnings of $1.4 billion and Commonwealth Bank posts a record cash net profit after tax of $6.835 billion. Commonwealth Bank and Westpac cut home loan interest rates. Telstra's annual profit falls by 17 per cent to $3.231 billion and Optus posts a 4.9 per cent fall in quarterly profit to $161 million. David Jones suffers a 10 per cent drop in sales, Harvey Norman posts a 1.7 per cent increase in global sales and Myer gives chief executive Bernie Brookes a pay rise and extends his contract for two years. Cochlear Ltd increases full year profit 16 per cent to a record $180.1 million. JB Hi Fi posts a fall in full-year profit to $109.7 million, a 7.55 per cent drop on the previous corresponding period. Coca Cola Amatil reports a 28 per cent fall in first-half profit as the closure of a fruit processing factory in regional Victoria wipes more than $80 million off the bottom line. About 150 job cuts expected under an overhaul of the Coca-cola owned SPC Ardmona food business. Bendigo and Adelaide Bank reports its full-year net profit is up 41 per cent to $342.1 million. Mining and rail equipment maker Bradken reports a fall in annual profit to 67.56 million. Developer Stockland says its net profit for 2010/11 is $754.6 million, up 57.7 per cent. Online travel agency Webjet has delivered a 5 per cent rise in full-year net profit after tax to $11 million. Rupert Murdoch’s News Corp reports a lower quarterly profit as weaker box office and DVD sales offset a strong performance by its cable and television business. Foxtel’s profit jumps 26 per cent to $200 million. Bain Capital and Kohlberg Kravis Roberts & Co are among potential bidders for MYOB Ltd, which could be sold for around $A1 billion. Adelaide based Argo Investments Ltd has increased full year profit by 11.8 per cent to $172.06 million. The coal market is heating up with Rio Tinto and Japan's Mitsubishi Corp offering to buy out minority investors in Coal & Allied Industries.

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Garry Barker and Leon Gettler