(19 January 2019, AFR, p27, by William McInnes) ‘Australian shares extended their gains for a second week on Friday despite investors erring on the side of caution. The S&P/ASX 200 Index rose 105 points this week, or 1.8 per cent, to 5879.6, while the broader All Ordinaries climbed 106.4 points, or 1.8 per cent, to … Continue reading
(19 January 2019, AFR, p20, by Sarah Turner) ‘December’s 1.3 per cent drop in house prices has proved the tipping point for Capital Economics, with the economics forecaster slashing its interest rate forecast as it braces for a deeper housing downturn. Marcel Thieliant, Capital Economics’ senior economist for Australia and New Zealand, said he made … Continue reading
(19 January 2019, AFR, p12, by Hans van Leeuwen) ‘London | “Brexit means Brexit,” Britain’s Prime Minister Theresa May once famously said. But with a mere 10 weeks to go, she still doesn’t really know what it means and neither does any Australian entrepreneur, exporter, executive or employee with British or European interests. All they … Continue reading
(19 January 2019, AFR, p3, by Joanna Mather) ‘Treasury officials have warned the federal government that Australia’s high levels of household debt will become unmanageable in the event of a downturn if unemployment rises. “A large increase in unemployment would quickly see an increase in loan defaults, which leads banks to slow the flow of … Continue reading
(18 January 2019, AFR, p27, by Robin Wigglesworth and Owen Walker) ‘New York/London | BlackRock founder Larry Fink has sounded a positive note on the global economy despite “many reasons to be worried and hit pause”, arguing that the miasma that enveloped financial markets in late 2018 was probably overdone.’ Read more at AFR.com (might … Continue reading
[COMMENT: Does this article tell us something about the state of health of the global economy? Or simply something about big banks? – say no more.] (18 January 2019, AFR, p22, by: Hannah Levitt, Max Abelson and Ben Foldy) ‘The six biggest United States banks have never had a $US100 billion year. Until now – … Continue reading
(18 January 2019, AFR, p19, by Jessica Gardner) ‘Monash Investors principal Simon Shields has warned aged care investors to prepare for a torrid year that will weigh on the share prices of Estia Health, Japara Healthcare and Regis Healthcare as the royal commission kicks into gear. Not that he is worried. Short-selling the sector’s three … Continue reading
(18 January 2019, The Age, p14, by Mathew Dunckley) ‘Department store giant David Jones is the latest retailer to confess to a weak Christmas amid gathering evidence that penny-pinching consumers shopped early at November sales and then stayed away from the shops during the festive rush. In a statement released on Thursday night, David Jones’ … Continue reading
(18 January 2019, The Age, p3, by Shane Wright) ‘A drop in home loans taken out across the country has prompted more warnings of further falls in house prices, with increasing interest from first-time buyers unable to offset dwindling numbers of investors. Figures from the Australian Bureau of Statistics released on Thursday showed the value … Continue reading
(17 January 2019, AFR, p30, by Larry Schlesinger) ‘Sydney office incentives lifted sharply in the final quarter of 2018, dampening rental growth, and should be “monitored closely going forward”, analysts at Deutsche Bank Research have warned.’ <snipped…> ‘Incentives, which can include rent-free periods and landlord contributions to office fitouts, usually increase as office leasing conditions … Continue reading
(17 January 2019, AFR, p29, by Larry Schlesinger) ‘The collapse of companies tied to Western Sydney developer and builder Merhis Group has cut a path of destruction among subcontractors and suppliers at the same time as the Australian Tax Office chases tens of millions of dollars in unpaid taxes. Amid the scrutiny on apartment construction following … Continue reading
(17 January 2019, AFR, p28, by Matthew Cranston) ‘Leading investment bankers in Australia’s commercial property market have admitted new floats and other corporate M&A activity will be softer this year due to volatile conditions and heated valuations. In an exclusive roundtable with The Australian Financial Review the majority of investment bankers agreed that commercial property … Continue reading
(17 January 2019, AFR, p26, by Timothy Moore) ‘Optimism for global growth and corporate earnings has crashed among global fund managers, according to Bank of America Merrill Lynch. A net 60 per cent of fund managers surveyed between January 4 and January 10 now think global growth will weaken over the next 12 months, which … Continue reading
(17 January 2019, AFR, p17, by James Fernyhough) ‘The combustible cladding crisis has left Australian building surveyors struggling to find compliant professional indemnity insurance, a development that industry sources warn could bring the construction industry to a “screeching halt”. If left unresolved, they say the withdrawal of insurers from the market could leave surveyors non-compliant … Continue reading
(17 January 2019, AFR, p17, by James Fernyhough) ‘Global business leaders have identified the potentially catastrophic effects of climate change as by far the greatest long-term risk facing the world, in a hard-hitting report released by the World Economics Forum ahead of its annual meeting in Davos next week. The Global Risks Report, which represents … Continue reading
(17 January 2019, AFR, p11, by Jeremy Warner) ‘Beware – according to the theory popularised by the economist John Maynard Keynes – “the paradox of thrift”. So far, the UK economy has proved remarkably resilient to the tortures of Brexit, which though they have resulted in slower growth and a profound political crisis, have not … Continue reading
(17 January 2019, AFR, p10, by Hans van Leeuwen) ‘London | The British Parliament has meted out a devastating defeat to Prime Minister Theresa May’s Brexit plan, rejecting it by a margin of 230 votes, forcing her back to the drawing board with her domestic critics and the European Union, and dealing a further blow … Continue reading
(17 January 2019, AFR, p9, by Michael Smith) ‘There’s a certain irony in the fact that Xi Jinping is now turning to the private sector to rescue China’s massive economy from its slowest period of growth since the global financial crisis. The nation’s millions of private-sector entrepreneurs have long complained they are disadvantaged by a … Continue reading
(17 January 2019, AFR, p9, by Jim Tankersley) ‘Washington | The partial government shutdown is inflicting far greater damage on the US economy than previously estimated, the White House acknowledged on Tuesday, as President Donald Trump’s economists doubled projections of how much economic growth is being lost each week the standoff with Democrats continues. The … Continue reading
(17 January 2019, AFR, p1, by Sue Mitchell) ‘First it was home loans, now retail spending appears to have fallen victim to the crackdown on credit in the wake of the financial services royal commission. Veteran retail adviser James Stewart says weak retail spending is another “unintended consequence” of the royal commission as consumers worried … Continue reading
(17 January 2019, AFR, p1, by Hans van Leeuwen) ‘London | As the vote tally was read out in Britain’s House of Commons, showing the epic scale of Prime Minister Theresa May’s defeat, the thousands of protesters gathered outside let out a collective roar of triumph. The elated throng of Union Jack-waving Brexiteers cheered the … Continue reading
(17 January 2019, The Age, Business, p20, by Stephen Bartholomeusz) ‘The pre-Christmas implosion in sharemarkets seemed to be signalling something very unpleasant ahead. The New Year bounce back in markets suggests the outlook may not be quite that bad. That doesn’t, however, mean that markets are sanguine about the prospects for the US and the … Continue reading
(16 January 2019, AFR, p1, by: Sarah Turner, Hans van Leeuwen and Lisa Murray) ‘Australia’s major banks are putting in place contingency plans to deal with the uncertain fallout from Brexit, setting up subsidiary offices in cities such as Frankfurt and Amsterdam to ensure they can still operate effectively across Europe.’ Read more at AFR.com … Continue reading
(15 January 2019, AFR, p29, by Larry Schlesinger) ‘Transaction activity in Australian commercial real estate has entered a cyclical downturn with new figures from CBRE showing the value of deals fell 9 per cent to $32.8 billion in 2018 in part due to a major slump in Chinese investment. Over the same period, the volume … Continue reading
(15 January 2019, AFR, p27, by David Finnerty) ‘The return of yield-hungry investors signals the worst may be over for Indonesia. Global funds are piling back into Asia’s bellwether for emerging markets, buying $US795 million ($1.1 billion) of debt so far this year and sending yields down about 90 basis points from their October peak … Continue reading
(15 January 2019, AFR, p27, by Mohamed A. El-Erian) ‘Markets have had a full week to digest the very strong US jobs report, as well as signs of progress in the China-US trade talks. Yet despite the positive news, investors and traders believe the Federal Reserve will stop hiking interest rates this year and will … Continue reading
(15 January 2019, AFR, p19, by: Edwin Chan, Lulu Yilun Chen and David Ramli) ‘Many of China’s proudest technology champions were only too glad to put 2018 behind them. This year may present even bigger challenges. From brushes with the law and a jaw-dropping market rout to regulatory clampdowns and even destructive American action, China’s … Continue reading
(15 January 2019, AFR, p9, by Michael Smith) ‘A surprise fall in China’s imports and exports in December has triggered fresh warnings the world’s second-largest economy faces a bumpy year even if Beijing can negotiate a permanent trade truce with the United States. A soft global economy contributed to China’s negative trade data in the … Continue reading
(14 January 2019, AFR, p30, by Larry Schlesinger) ‘Prominent Melbourne businessman Tim Roberts-Thomson and his family have sold 33,000 hectares of prime grazing land fronting the Murrumbidgee River in NSW’s Southern Riverina for about $60 million, adding to a strong start to the summer rural selling season.’ Read more at AFR.com (might need AFR login … Continue reading
(14 January 2019, AFR, p29, by Ingrid Fuary-Wagner) ‘Australia’s largest property markets of Sydney and Melbourne might have shown some big falls in house prices but it is outback Queensland that was the worst performer in 2018 with mortgagee-in-possession sales starting to bite. Property prices in the expansive region, which encompasses the towns of Longreach, … Continue reading
(14 January 2019, AFR, p21, by Sarah Turner) ‘Sharemarkets have shaken off some of last year’s gloom in the early weeks of 2019 but fund managers and strategists say the United States earnings season is the next key hurdle for markets.’ Read more at AFR.com (might need AFR login access, or try: AFR.com/trial)
(14 January 2019, AFR, p11, by Edward Malnick) ‘London – The Tories are on the brink of a historic split, senior Conservatives warned late on Saturday, as Brexiteers and Remainers both threatened to torpedo the government if they don’t get their way. Pro-EU MPs claimed that a third of the cabinet would resign if Theresa … Continue reading
(14 January 2019, AFR, p10, by Mike DeBonis) ‘Washington – The longest federal government shutdown in US history ground into a fourth week on Saturday with President Donald Trump showing fresh defiance on Twitter, congressional Democrats firmly resolved to resist his calls for a border wall, and unpaid workers caught in the middle. “We will … Continue reading
(12 January 2019, AFR, p5, by Vesna Poljak) ‘Retail sales advanced 0.4 per cent in November, from 0.3 per cent in October, providing comfort around what has emerged as a critical month on the consumption calendar because of the popularity of online promotions such as Click Frenzy. Economists were looking for 0.3 per cent month-on-month … Continue reading
(11 January 2019, AFR, p15, by Bo Seo) ‘Women’s fashion retail group Noni B has overcome headwinds in the retail sector and reported a successful Christmas season, buoyed by its strategy to cut costs and exploit differentiated markets after acquiring five brands from rival retailer Specialty Fashion.’ <snipped…> ‘While the retail sector has struggled with … Continue reading
[COMMENT: A number of news reports of the Christmas shopping period indicate disappointing sales for many retailers, but not this one.] (11 January 2019, The Age, Business, p20, by Patrick Hatch) ‘Mid-market women’s fashion retailer Noni B has upgraded its half-year profit guidance after seeing better than expected Christmas sales. The group, which also owns … Continue reading
(11 January 2019, The Age, Business, p20, by Stephen Bartholomeusz) ‘The second half of last year was a horrible one for commodities, with prices tumbling from mid-year and accelerating in the final months as concerns about trade tensions and the US Federal Reserve Board’s monetary policies unnerved all markets. This year, however, has started on … Continue reading
(11 January 2019, AFR, p27, by Katherine Greifeld) ‘As the US government kicks off its debt sales this year, here’s one potentially worrisome sign for traders to keep in mind: the steep decline in demand at its bond auctions. Of the $US2.4 trillion ($3.3 trillion) of notes and bonds the Treasury Department offered last year, … Continue reading
(10 January 2019, AFR, p29, by Matthew Cranston) ‘Confidence in the property sector is at its lowest point in more than five years and expectations around the availability of finance – key for the health of building and transaction activity – has worsened to its lowest on record, according to more than 1000 industry experts. … Continue reading
(10 January 2019, AFR, p26, by Lu Wang) ‘Everyone knows profit growth is poised to cool this year. But by how much? Analysts who try to answer that question by looking at signals embedded in the stock market are coming up with some worrisome numbers. Going by history, the 16 per cent decline in the … Continue reading
(10 January 2019, AFR, p25, by Martin Wolf) ‘Should we be concerned about the state of the world economy? Yes: it always makes sense to be concerned. That does not mean something is sure to go badly wrong in the near future. On the contrary, the world economy seems to be heading into just a … Continue reading
(10 January 2019, AFR, p15, by Matthew Cranston) ‘Beauty and home products retailer Crabtree & Evelyn is the latest retailer to fall victim to lower discretionary spending by under-pressure households, with restructuring experts KordaMentha appointed to close down the entire Australian network of stores. “We decided to execute the close-down of Crabtree & Evelyn in … Continue reading
(10 January 2019, AFR, p4, by Elouise Fowler) ‘As 2018 drew to an end, Australian employers hunted around the nation to hire new staff to fill 242,900 jobs in the private sector and 21,500 government jobs, which amounts to a modest growth in total job vacancies by 1.7 per cent, according to fresh data from … Continue reading
(10 January 2019, AFR, p5, by Michael Bleby) ‘Building approvals of new apartments dropped to their lowest in more than five years in November, as investors retreated and developers scaled back new plans in the face of tighter credit curbs and uncertainty about the east coast housing market.’ Read more at AFR.com (might need AFR … Continue reading
(10 January 2019, AFR, p3, by John Kehoe) ‘A slowdown in the world economy will soften anticipated federal revenues and may force the government to spend more to support Australia, stopping the Morrison government reaching its much-hyped return to a budget surplus next year, economists at Fitch Solutions have predicted. Fitch Solutions, a global macroeconomic … Continue reading
(9 January 2019, AFR, p39, by Ed Shann) ‘The global economy is slowing, sharemarkets are falling and volatility has risen. Monetary policy is what is driving markets. Don’t be fooled by chatter about Donald Trump, Brexit, Italy or other causes. Global monetary tightening is what is important. Central banks have moved from printing money by … Continue reading
(9 January 2019, AFR, p30, by Ingrid Fuary-Wagner) ‘Property stock levels are soaring in several capital cities across Australia as homeowners struggle to sell leaving homes to languish on the market. The number of listings in Melbourne, Canberra and Sydney surged 25.4 per cent, 19.3 per cent and 16.5 per cent respectively year-on-year in December, … Continue reading
(9 January 2019, AFR, p29, by Nick Lenaghan) ‘One of the biggest apartment developers in Melbourne – Malaysia’s UEM Sunrise – is prepared for as much as a 10 per cent default rate on the settlement of apartments in its $330 million CBD tower, signalling just how difficult the market is about to get following … Continue reading
(9 January 2019, AFR, p28, by Karen Maley) ‘Is Beijing about to hasten to the rescue of the global economy as it has done twice before in the past decade? Certainly, investors’ hopes for yet another Chinese stimulus program were boosted at the end of last week after China’s central bank stepped up efforts to … Continue reading
(9 January 2019, AFR, p27, by Timothy Moore) ‘The S&P 500 could still be as much as 14.5 per cent overvalued, and that could keep the Federal Reserve on the sidelines through the first half of 2019, according to NAB. NAB market strategist Tapas Strickland said the recent sell-off “has seen valuations come back more … Continue reading
[COMMENT: Now this is a very interesting insight into the global soy bean market, and who supplies soybeans to whom.] (9 January 2019, AFR, p24, by Gregory Meyer) ‘Reserve, Louisiana | The final 370 kilometres of the Mississippi river have long reinforced American might in global food markets. Ten grain terminals tower like fortresses along … Continue reading
