Lower Valley Energy

Market Wrap: US growth fears trigger local falls

A weak US jobs report triggered steep falls on the Australian share market today. Local stocks shed more than 2 per cent. The banks fared the worst, with few pockets of resistance across the board. A number of companies also went ex-dividend today.

The S&P/ASX200 Index tumbled 101 points to close at 4,142. On the futures market, the SPI has sank 93 points.

Economic news Job advertisements in Australia fell for the second straight month in August. ANZ Banking Group’s (ASX:ANZ) jobs survey revealed total job ads were down 0.6 per cent last month.

Inflation plunged last month for the first time since October 2009. The TD Securities - Melbourne Institute monthly inflation gauge fell 0.1 percentage points in August.

Gross business profits from operations increased more than expected in the June quarter, up 6.7 percent, according to the Australian Bureau of Statistics. The rise points to strong June quarter GDP figures, due on Wednesday.

Activity in the Australian sector expanded services last month. The Australian Industry Group and Commonwealth Bank of Australia (ASX: ABC) Australian Services Performance Index rose 3.3 points to 52.1 points in August.

Car sales have increased for the second straight month. The Australian Federal Chamber of Automotive Industries says sales of new vehicles in Australia rose 7.3 per cent from August last year.

Investor confidence is at its lowest point in more than two years. A survey of 820 investors from research firm CoreData has shown investor sentiment dropped 15.7 points to minus 21.7 in the third quarter of this year.

Company news Global growth concerns sank all the major banks today, all closing more than 2 per cent lower, on the same day reports emerged that Standard and Poor’s is embarking upon a major review of global banks. The AA credit rating assigned to Australia’s banks is understood to be at threat due to their reliance on wholesale funding and increasing asset prices and household debt. Shares in National Australia Bank fared the worst of the big four, falling 3.15 per cent to close at $22.77.  Coal hauler QR National Limited (ASX:QRN) has struck a deal to build the $900 million Wiggins Island Rail Project in Queensland. Construction of the export terminal at the Gladstone liquefied natural gas project is due to start early 2012. Shares in QR National firmed earlier in the day but closed flat at $3.26.

Lower Valley pulls plug on winter rate plan

In a small victory for the poorest Jackson Hole residents, Lower Valley Energy has dropped a plan to impose a significantly higher electricity rate in winter.

Instead, all residential users will pay 1 percent more year round, according to a News&Guide report.

Lower Valley’s board of directors had voted in June to create a new pricing system, in which residents would pay a higher rate for power during winter, when demand is greatest. The board opted not to charge more to the heaviest consumers of electricity, who drive up costs for the cooperative as a whole.

The decision sparked a sharp backlash . Among the hardest hit would have been low-income renters, who are more likely to be living in older, poorly insulated homes heated by electricity.

According to the News&Guide, Lower Valley reversed course because of continued uncertainty over how Bonneville Power Administration will price electricity it supplies to the cooperative. The board plans to revisit the rate structure next summer.

Mark your calendars once the date of Lower Valley ‘s annual meeting is set next spring, and be sure to make your voices heard.

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