On a day when NATO called an emergency meeting to deal with a deadly missile attack that killed two Polish citizens and Donald Trump announced his run at a second Presidency saying he “would save America”, the market is lower but hasn’t been blown away.
US President Joe Biden held an emergency meeting of G7 allies to discuss the supposed attack on Poland, however, he is not blaming Russia.
“It is unlikely ... that it was fired from Russia. But we’ll see,” Biden told reporters after the meeting.
Warsaw has raised its military awareness as Poland looks at how to respond.
EU chief Charles Michel said the EU would support Poland.
“Just spoke with (Mateusz Morawiecki). Assured him of full EU unity and solidarity in support of Poland. I will propose a coordination meeting on Wednesday with EU leaders attending G20 here in Bali,” Michel tweeted.
Australia’s Foreign Minister Penny Wong offered support for Poland but called for calm until an investigation was complete.
“I would echo the words of the Polish Prime Minister, who said he called on Poles to remain calm and prudent,” Senator Wong said.
“I also say to Australians, we will stay in close contact with our friends and partners.
“The Polish Government will undertake a proper investigation, and I urge people, as the Polish Government has, to await the outcome of those investigations.”
The Russian Defence Ministry denied its missiles had strayed into Polish territory.
You would have thought another destabilising act of this kind would have a major impact on the market. Instead, the ASX only saw minor downward movement.
The S&P/ASX200 19.40 points or 0.27% to 7,122.20. Over the last five days, the index has gained 1.76% but is down 4.33% for the last year to date.
The bottom-performing stocks in this index are De Grey Mining Ltd and Imugene Ltd (ASX:IMU, OTC:IUGNF), down 9.52% and 9.20% respectively.
Looking at the sectors, Energy was the best performer with a 1.14% gain. Materials and Real Estate made minor gains of 0.60% and 0.50% respectively. The biggest loser was Utilities down 1.46% followed very closely by Consumer Discretionary down 1.43%.
Making news today
Wage date reinforces next wage rise
The Australian Bureau of Statistics released its September quarter wage statistics.
In the September quarter of 2022 the seasonally adjusted WPI:
- rose 1.0% this quarter and 3.1% over the year; and
- the private sector rose 1.2% and the public sector rose 0.6%.
Seasonally adjusted private sector wages rose 1.2% over the September quarter of 2022, the highest quarterly rate of wages growth since the September quarter of 2010.
Through the year growth lifted to 3.4%, the highest annual rate since the December quarter of 2012.
Jobs paid under individual arrangements were the strongest contributor to wages growth.
While this is good news for workers, it does raise questions about the Reserve Bank of Australia’s continued attack on inflation.
According to Betashares (ASX:BBUS) chief economist David Bassanese, the strong data is likely to push the RBA into another 25-point rate rise next month.
"Today’s stronger than expected wage price index result, especially the relatively large gain in private sector wages, likely cements the case for a further 0.25% rate rise by the RBA next month," Bassanese said.
"That said, the result is not alarming enough to suggest the bank will revert to a larger 0.5% rate increase, especially as the relatively large gain in private sector wages in part reflects the recent increase in minimum award wages."
The ABS noted that the largest Fair Work award wage increase in more than a decade was a major contributor to private sector wage growth.
Standing up for the private sector
Wage growth will no doubt affect interest rates, however, according to Business Council chief executive Jennifer Westacott the government should rethink “untrialled multi-employer bargaining”.
“Businesses are delivering the strongest rate of wages growth in a decade, which will help ease the burden of skyrocketing inflation and cost of living pressure for the six out of seven workers employed by a business," she said.
“The government’s strong advocacy for higher award rates at the Fair Work Commission has helped deliver for Australians in some sectors, but strong growth for workers on enterprise agreements or in individual arrangements are the biggest drivers of faster wages growth.
“We all agree that Australians should get paid more, but the workplace relations legislation currently before the Senate isn’t a solution and it risks sending workers backwards.
“This is a reminder that the parliament, the government and the key stakeholders must focus their efforts on the sectors and workers who need help, not the businesses that already pay their workers more and deliver better conditions."
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