Economic and market news
In Australian market news this week, the ASX200 broke back up through the 7000 threshold on Tuesday. This was said to have been off the back of ‘dovish’ sentiments on US monetary policy (with markets pricing a lower likelihood of another official rate rise) and positive signs of inflation easing in NAB’s monthly business survey.
The business survey data show ongoing resilience in activity. Business conditions were down slightly in September but in line with where they have been since May. Capacity utilisation remains high and there has been gradual improvement in forward orders (including in retail). Business confidence remained broadly neutral. Labour cost, purchase cost, and output price growth all eased in September, which was taken as suggesting the momentum of some of the key pressures driving inflation may have started to step back.
In overseas economic news, there were a ‘stunning’ 336,000 jobs added to the United States economy in the month. Alongside this, other new data on jobs market saw the number of people filing new claims for unemployment benefits rise moderately last week, but layoffs declined in September. These figures were said to indicate that the labour market is still tight at the end of the third quarter, and to suggest the economy remains resilient.
It was reported that Chinese consumers travelled and spent less over the Golden Holiday week than the government had hoped. The nation recorded some 826 million domestic trips over the eight-day vacation period that concluded on Friday, bringing in some 753.4 billion yuan ($125 billion) in revenue.
Australian indices
ASX 200: Rose this week (1.40 per cent), breaking back through the 7000-point threshold to close at 7040.6 points on Tuesday.
All Ordinaries: Also rose (0.14 per cent), closing at 7231.0 points on Tuesday.
Government Bonds
Government Bond Yields (Source: Bloomberg)
|
NAME |
COUPON |
PRICE |
YIELD |
1 DAY |
1 MONTH |
1 YEAR |
|
GTAUD2Y:GOV Australia Bond 2 Year Yield |
0.25
|
92.59 |
3.94% |
-3 |
+13 |
+68 |
|
GTAUD5Y:GOV Australia Bond 5 Year Yield |
2.75 |
94.09 |
4.04% |
-4 |
+22 |
+46 |
|
GTAUD10Y:GOV Australia Bond 10 Year Yield |
3.00 |
88.25 |
4.45% |
-6 |
+37 |
+59 |
|
GTAUD15Y:GOV Australia Bond 15 Year Yield |
3.25 |
83.87 |
4.70% |
-6 |
+38 |
+59 |
Reserve Bank of Australia (Source:RBA)
|
RBA CASH RATE TARGET (RBATCTR:IND) CURRENT (per cent) |
MOST RECENT DECISION (percentage points) |
MOST RECENT CHANGE (percentage points) |
1 YEAR PRIOR (per cent) |
|
4.10 |
No change (3 October 2023) |
+0.25 (6 June 2023) |
2.60 |
Currencies (source:RBA)
As at the close on 10 October, the AUD/USD had risen over the week, up 1.50 per cent, to 0.6411. The AUD/RMB also rose, up 1.36 per cent in the period, closing at 4.6721 on Tuesday.
Commodities
Global oil prices had been softening from their recent highs over the past week. However, the conflict in Israel has seen the price of Brent crude surge by as much as 5 per cent, to over US$88 a barrel.
Venture Capital
New data on the state of the Australian venture capital industry show that funding to start ups edged marginally above the 2020 run rate. However, the $739M announced in Q3 fell short of the amount seen in Q2 by 9 per cent, and the total announced funding so far in 2023 stands at just 42 per cent of that seen the same period in 2022. Cut Through Ventures suggests that this is due to a rise in smaller internal rounds, which it believes represents an underreporting of 10-15 per cent of the total funding volume.
A feature article in The Australian newspaper talked about the difficulties faced by biotech start ups, particularly in raising sufficient funding from Australian investors to fund medical trials.
Ferronova
Stoic investee Ferronova has shared more about its agreement with Purdue Innovate and how it is set to improve MRIs for glioblastoma, an aggressive form of brain cancer.
Morse Micro
Kevin Daly and David Halasz from Stoic investee Morse Micro spoke to The Signal Podcast about all things Wi-Fi HaLow, including how the technology enables secure, low bandwidth IoT connections at the sub-1 GHz spectrum, and the benefits over long distances in rural areas.
Property
Stoic investment partner Elanor Investors Group published its 2023 Environmental, Social Governance Report, summarising its achievements during the year and setting the direction for the future in these areas.
It also announced that one of its properties in Brisbane (200 Adelaide Street) has achieved a 5 star National Australian Built Environment Rating System rating, an increase from 4 stars the previous year. It highlighted its commitment to providing a best-in-class sustainability pathway, and noted that over 36 per cent of its portfolio is carbon neutral certified.
New data show that rental vacancies have dropped to a fresh low of just 0.8 per cent nationally, with record lows in Sydney (0.9 per cent), and Perth (0.3 per cent). This has fuelled more rental price growth, although there has been deceleration in some segments.
