Not the best of times to be spending weak US dollars in a strong currency economy like Australia, or for repatriating money from overseas.
So it was a touch odd to see Xstrata whip out a $3.1 billion offer for Jubilee Nickel yesterday: a deal if revealed a couple of months ago, could have been done for 5-10% less that in US terms.
The deal was revealed as the Aussie climbed over 92 USc and kept on going ahead of the two-day meeting of the Fed starting tonight. It traded around 92.50c last night, up one and a third USc since Friday afternoon but eased to around 92 USc. Oil prices also traded over $US93 a barrel, before closing at $93.53 in New York.
The Jubilee bid sparked a rush in resources, the All Ordinaries adding 91.8 points to 6808.2, topping its previous record close of 6779.58, also set on October 11,
And the ASX200 index rose strongly by 91.5 points to 6792.1, beating its prior closing high of 6771.91, also set on October 11.
The Dow rose overnight and our market will start firm again today. Copper and gold rose, the latter topped $US792 an ounce.
Brokers said Rio Tinto and BHP alone made up 30 points of the rise yesterday.
Jubilee jumped 40%, taking the nickel miners up with it along with a spread of other miners.
BHP was up $1.54 to $47.30 and Rio jumped $5.59 to $112.59. Jubilee surged $6.72, or more than 39% to $23.82 after the Xstrata bid.
Other nickel miners such as Sally Malay Mining rose 61c to $5.51, Minara Resources 43c to $6.48, and Mincor Resources 31c to $4.84.
Zinifex improved rose 44c to $18.59 after banking about $1.4 billion from the successful initial public offer of Nyrstar. Another $140 million could come later this year.
Oil and gas producer Woodside Petroleum put on $1.12 to $55.21, and Santos rose 46c to $14.94, despite problems in the Cooper Basin, as world oil prices jumped over $US93 a barrel for West Texas Intermediate.
Boral revealed yesterday to shareholders that a combination of the higher dollar and the tougher housing market would clip returns by around 15% over the full year (that's if the dollar remains around present levels).
Investors didn't give the rising currency a second thought yesterday, concentrating on the higher US dollar prices for oil and gold (and copper) and forgetting that the higher Aussie is clipping those prices.
Zinifex raised $1.4 billion from the float of its smelting and processing joint venture, Nyrstar NV. If it had done the deal and brought in the money a week ago yesterday it would have got just under 89 US (what) and the amount raised could have been $100 million more for the company, such has been the rise in the Aussie over the past week.
Zinifex and its partner Umicore SA of Belgium, said yesterday they sold 86.96 million shares in Nyrstar at 20 euros per share.
The two companies said they may sell an additional 13 million shares to cover over-allotments resulting in their exit from the company.
Nyrstar, which owns smelters in Australia, the Netherlands, Belgium, France, Thailand and the US, produces about 10% of the world's zinc, plus lead, silver and some heavy metals like cadmium.
Zinifex said in the statement that the proceeds raised from the sale of Nyrstar "will enhance the range of acquisition opportunities that it might consider. Zinifex will now focus on growing its mining business to complement the already strong performance from our two mines, Century and Rosebery.''
But the dollar has cut the expected high cash payment some ZFX shareholders were initially expecting.
Likewise the $23 a share offer for Jubilee Mines from Xstrata would have been cheaper if launched a month ago. The Aussie dollar was around 5% or so cheaper then (it had spent the past month bouncing around from 88c to just over 90c and back down again.
The likes of Ridley Corp, the stockfeed group, had a gloomy story for shareholders: the Aussie dollar is a burden, but so is the drought in Australia which is damaging customers and revenues, although things are holding up at the moment.
And if the market falls, then the likes of listed investment company, Argo Investments, are waiting to pounce.
Argo had an upbeat AGM in Adelaide yesterday and revealed an ambition to go shopping for more shares if there's a correction.
Chairman, Chris Harris, told shareholders that the company had spent more than $200 million for "quality investment purchases" during the 15% fall in the market in the August credit freeze.
But with no debt and $400 million in cash reserves, he said the company was ready to invest more.
"We are ready to take advantage of any further setbacks in the share market," Mr Harris said.
Some of those recent purchases have done well, such as top ups in Westfield Group, QBE Insurance Group, National Australia Bank, Fairfax Media, Global Mining Investments, Brambles and Woolworths.
These buys add to Argo's major share purchases in the past financial year, including BHP Billiton, Telstra, Rio Tinto, Woodside and Santos.
Managing director, Rob Patterson, said Argo's diversified portfolio of Australian shares increased in value during the 2006/07 financial year from $3.1 billion to $4.2 billion.
Of this increase, $700 million resulted from revaluations of the company's long term investments.
But Mr Patterson acknowledged Argo's total portfolio return of 28.4% for the year fell below the 30.3% return from the All Ordinaries Accumulation Index.
The All Ordinaries result was driven by energy and natural resource companies, he said and "Given our conservative corporate objective, it is not unusual for our return to lag the market when it is rising rapidly."
Mr Harris also defended the portfolio weighting, saying Argo needed to balance the low, although growing, dividend yiel
