The ASX made gains today, moving 17.10 points or 0.25% to 6,995.30. The local bourse gained on the back of US optimism about unexpectedly low jobs figures, which dampened the possibility of a rate hike.
Over the last five days, the index has gained 2.47% but is virtually unchanged over the last year to date.
Health Care was firmly in the green (up 1.42%) followed by Consumer Discretionary (0.57%) and Real Estate (0.32%), while at the other end of proceedings, Energy languished (down 0.97%), while Communications Services were softer (0.34%). Everything else was hovering close to even.
Bank says customers are adapting
Net profit at Westpac was up 26% to $7.2 billion, while the bank’s loans are up 5% to $773 billion, comprising mortgages (4%) and retail deposits (10%).
The bank also delivered investors a $1.5 billion share buyback.
The good news for the bank comes as CEO Peter King commented that hardship and arrears metrics were looking pretty good on the whole, and only half as bad as those seen during the height of the COVID-19 pandemic.
This is despite Westpac data showing that 40% of its mortgage customers are no more than a month ahead in their repayments, while about 1.5% are already at least a month in arrears.
Holiday rate hike
State Street (NYSE:STT) Global Advisors senior strategist Clive Maguchu and research analyst Garvit Srivastava have these predictions about what happens after the Melbourne Cup Day RBA meeting:
“The macro uncertainty from elevated inflation and the central bank efforts to stem this now seems destined to continue. The markets are now embracing the ‘higher for longer’ narrative and pushing out expectations for rate cuts.
“In recent months, the Fed, BoE and Reserve Bank of Australia (RBA) left interest rates unchanged.
“The primary theme in all the commentaries for the pause was quite hawkish, indicating caution against letting inflation get out of hand and warning that interest rates could stay elevated for a longer period of time.
“The surge in oil prices over the last quarter, and now, potentially, the breakout of war in the Middle East, has maintained the significance of the said concerns.
“The thorn in the side for global central banks has been the strong labour markets.
“Although the consensus view is that the Australian labour market is strong, we believe that it is cooling.
“Overall, the (economic) picture is not quite as gloomy compared to peers, with Australia having lower recession risks than many other developed economies. This is partly to the credit of the RBA.
“The RBA has tended to approach rate hikes with greater restraint than other global central banks, only raising rates by a cumulative 400 bps versus 525 bps by the Fed. Instead, the RBA has opted for several hawkish pauses instead. The pause in October serves as an example of this stance. A hike is still an option for November.
“Our expectations are that over the next few months the tighter monetary conditions will show a material effect on economic growth. However, without any decline in inflation, policy reversal is unlikely.
“We favour a diversified quality defensive equity approach in the present climate. Defensive equities are more equipped to endure economic uncertainty. They are characterised by short duration earnings, high margins and stable operations which are less exposed to the high rate environment.”
The five at five
Imugene sees positive early signs in VAXINIA trial; “may be potent anti-cancer drug”
Imugene Ltd (ASX:IMU, OTC:IUGNF) is seeing positive early signs from its phase 1 MAST (metastatic advanced solid tumours) clinical trial evaluating the safety and efficacy of VAXINIA — the novel cancer-killing virus CF33-hNIS, including one complete response in bile duct cancer and one partial response (PR) in melanoma.
Read more
Fenix Resources completes $2 million sale of Extension Hill hematite assets
Fenix Resources Ltd (ASX:FEX) has secured $2 million from Terra Mining Pty Ltd and Extension Hill Pty Ltd (EHPL) for the completed sale of the decommissioned Extension Hill hematite operation in Western Australia's Mid-West.
Read more
Aurumin confirms presence of lithium at Mt Palmer with broad pegmatite intersections
Aurumin Ltd (ASX:AUN) has identified lithium mineralisation at the Mt Palmer Project in Western Australia, encountering wide intersections of lithium-caesium-tantalum (LCT) style pegmatites in drilling on the tenure.
Read more
Gold Hydrogen inks MoUs for natural hydrogen pilot plant collaboration
Gold Hydrogen Ltd (ASX:GHY) has signed Memorandums of Understanding (MoUs) with Wasco Energy and H2Site to collaborate on a proof-of-concept natural hydrogen pilot project on South Australia's Yorke Peninsula.
Read more
Elixir Energy will share information with Origin Energy for Grandis Gas Project
Elixir Energy Ltd (ASX:EXR) has executed an information-sharing agreement with Origin Energy ahead of the upcoming spud of its Daydream-2 well at the Grandis Gas Project in Queensland’s Taroom Trough.
Read more
On your six
US anti-woke movement targets ESG investment criteria
Rio Tinto (ASX:RIO), Australia's largest iron ore exporter, is exploring the possibility of repurposing former mines in the Pilbara region to establish solar power farms. The initiative aims to offset the 3 million tonnes of carbon emissions annually produced by its network of 17 operational mines.
Read more
The one to watch
Lightning Minerals confirms multiple pegmatites in Quebec
Lightning Minerals Ltd (ASX:L1M) MD Alex Biggs tells Proactive the company has completed its initial exploration program at its Dalmas and Hiver projects in the James Bay region of Quebec, Canada, confirming historical reports of outcropping pegmatitic lithologies at both project areas.
Watch