The ASX has shed 3.52% over the last five days.
This latest week has been a doozy, with the index shedding over 100 points in just five days and setting a new 20-day low today.
Only Consumer Staples managed to cross into the green this week, gaining 0.51% as Materials shed the most, losing 10.45%.
The other markets weren’t spared the bloodletting, falling across the board:
Commodities have also collectively taken a beating, with the smallest losses to gold (-2.51%) and the highest to tin (-12.98%).
West Texas Intermediate crude oil plummeted this week, falling from a high of US$97.30 a barrel to US$88.47 today, a 9.07% fall in just five days.
Brent Crude Oil has followed a similar trajectory, peaking at US$105.46 earlier this week before shedding 10.63% to US$94.24 a barrel.
The dip may be timely for Australian consumers, who are eyeing the end of this month with trepidation as it marks the end of the A$0.23-per-litre fuel excise cut for unleaded petrol and diesel.
Jobs summit highlights missing value of women’s labour
The Jobs and Skills Summit has headlined these last few days, as the nation waits to see if the result will be all talk or something of substance.
One of the more surprising turn of events was the unlikely alliance between the Business Council of Australia (BCA) and the Australian Council of Trade Unions (ACTU) on the subject of paid parental leave, and women’s participation in the workforce in general.
The two organisations have presented a united front on the topic of parental leave extensions – one of the largest challenges affecting women in the workplace today, alongside the super and pay gender gaps.
Both the super and pay gap have increased marginally this year, with the super gap climbing to 23.3% as the pay gap rose 0.3% to 14.1%.
As far as Minister for Women and Finance Katy Gallagher is concerned, addressing this parity is a "core economic imperative" for Australia.
"If women's workforce participation matched men, we would increase GDP by 8.7% or $353 billion by 2050," Minister Gallagher said.
Women’s participation in the labour force has historically been lower than men’s, due in large part to the disparity in care giving and child raising roles among the sexes.
Women averaged about 62.2% participation in July this year, while men hit 70.8%.
This has a lasting and compounding impact on women’s opportunities, not only in the workforce but within their superannuation accounts and other long-term life assets.
Director of the Global Institute for Women's Leadership Professor Michelle Ryan suggests that systemic cultural and policy change is necessary to address these gaps, and more emphasis should be placed on men as providers of care.
"This has positive effects further down the line, with fathers who have taken significant parental leave being more involved in childcare even after leave has ended," Professor Ryan said.
Day one of the Jobs summit saw positive agreement on this front; the federal government will bring forward proposed changed to childcare subsidies, whereby families with less than $80,000 combined income could have up to 90% of their childcare costs paid for their first child.
The BCA and ACTU are pushing for an extension of parental leave from 18 to 26 weeks, but Minister Gallagher has stated budget constraints will be a hurdle.
"The Treasurer and I are also absolutely cognisant of the fact we have massive deficits and a trillion dollars of debt … I wish I could fund every good idea that had merit," Minister Gallagher said.
Potential food crisis on the horizon
Federal Nationals leader David Littleproud was in attendance at the Jobs summit, where he highlighted the need for 172,000 more workers on Australian farms.
Australia has mostly avoided the effects of the food crisis currently unfolding on the global stage, but past success doesn’t guarantee future security.
“I saw the human toll. In Carnarvon, [one farmer] walked away from his property because he didn’t have the confidence to be able to plant a crop and harvest it,” Littleproud said.
“Some farms are planning to run at only 50-60% capacity. That causes not just a cost-of-living crisis, it’s a food security crisis ... I’ve got pubs in my own electorate in Barcaldine, the home of the Labor party, where pubs are not open for a feed because they can’t get cooks.”
In a break with traditional thought, Littleproud stated that Pacific work visas are welcome, but that they “can’t do it all".
“We’ve had enough of them coming picking crops and passing through; we want them to live in regional Australia,” he said.
The Nationals leader called on greater government support for those migrating to regional Australia, suggesting student debt waivers, or discounts for medical professionals working in those areas, and recommended similar support should be extended to those working in aged care.
US signs climate investment into law in the form of US Inflation Reduction Act
US President Joe Biden signed the Inflation Reduction Act (IRA) into law on Tuesday August 30, 2022.
While the act is predominantly aimed at reducing inflation, it includes a US$369 billion investment in climate action and renewable energy policies.
Its provisions are far-ranging, including:
- adding two electric vehicle (EV) tax credits totalling US$7,500 for EVs that are assembled in North America and meet certain conditions;
- rebates available through state energy offices for homeowners that make energy-efficient upgrades; and
- provisions to assist in cleaner state and local government buildings through the adoption of net zero energy codes.
Janus Henderson Investors have run the numbers, and they believe the bill will provide substantial funding to develop EV charging infrastructure as well as funding for green hydrogen.
“In our view, the Bill is an acknowledgement that the US needs cheap, renewable forms of energy to both lower inflation and move towards security of energy supply, by reducing reliance on major suppliers like China and Russia, and instead looking to renewable energy grids and other domestic energy sources,” the asset management company stated.
“The Inflation Reduction Act is set to ensure the US makes concrete and swifter progress towards decarbonisation.
“It follows in the footsteps of other regions; the REPowerEU roadmap was unveiled by the European Commission in March 2022.
“It sets out a series of measures to rapidly reduce dependence on fossil fuels, fast forward the green transition to lower energy prices, increase energy security as well as improving industrial competitiveness and supporting technology leadership in the industries of tomorrow.
“China too has green technology leadership ambitions; it’s anticipated that almost half of the world’s solar installations will be in China through to 2031 according to Fitch Solutions, while the International Energy Agency (IEA) reported that half of global EV sales in 2021 were in China.
“For these reasons, the long-term investment case for an allocation to resource equities has never been stronger.
“We continue to see a diverse range of attractive opportunities within a sector that is providing the inputs and technological advancement needed for a more sustainable world.”
On the small cap front
Kingfisher (LON:KGF) Mining surges 109%
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Kinetiko Energy jumps 37%
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Volt Resources climbs 21%
Volt Resources Ltd (ASX:VRC) is up after progressing the Bunyu Graphite Project in Tanzania with a feasibility study update and appointing a battery metals senior advisor.
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C29 Metals rises 15.38%
C29 Metals Ltd (ASX:C29) shares lifted after beginning geophysical surveying on its recently acquired Mayfield Copper Project in Queensland.
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