The Australian share market has finished lower after four sessions of gains, with investors worrying the US Federal Reserve will keep raising interest rates above 5 per cent, and keep them there for a while after comments overnight by Fed officials.
And US investment bank Goldman Sachs is set to start laying off workers tomorrow amid the slowing global economy and falling income from investment banking.
Disclaimer: this blog is not intended as investment advice.
Key events
Live updates
Markets snapshot at 4:20pm AEDT
By Sue Lannin
ASX 200: 7,131 down 0.3 per cent
All Ordinaries: 7,337 down 0.3 per cent
Australian dollar: 69.14 US cents up 0.1 per cent
Nikkei: 26,159 up 0.7 per cent
Dow Jones: 33,518 down 0.3 per cent
S&P 500: 3,892 down 0.1 per cent
Nasdaq: 10,636 up 0.6 per cent
Spot gold: $US1873 an ounce, up 0.1 per cent
Brent crude: $US79.16 a barrel, down 0.6 per cent
Bitcoin: $US17,203 up 0.1 per cent
FTSE 100: 7,725 up 0.3 per cent
DAX: 14,793 up 1.3 per cent
CAC 40: 5,185 up 0.7 per cent
Thanks and good night
By Sue Lannin
To recap, the Australian share market ended lower today after more hawkish comments from US Federal Reserve officials about future interest rate rises.
Household spending remained strong in November as people spent up big on the Black Friday and Cyber Monday online sale, but the annual rise also reflected a big bounce back from last year's COVID lockdowns.
Investors are waiting to hear from Fed chairman Jerome Powell tonight and the latest US consumer inflation figures will be out later this week.
Also, US investment bank Goldman Sachs is expected to start laying off thousands of workers on Wednesday.
Have a good night and join us again tomorrow.
Here's some more Hamilton!
ASX 200 market movers at the close
By Sue Lannin
Here's how the ASX 200 finished for the day. Most sectors were in the red led down by industrial firms, miners, energy stocks and financials.
Consumer and healthcare stocks made small gains.
Construction materials firm Boral (+2.7 per cent) did the best, while gold miner De Grey (-7.9 per cent) did the worst.
ASX ends lower as investors worry about more US rate rises
By Sue Lannin
The Australian share market has ended lower after a mixed night on Wall Street.
The ASX 200 index fell nearly 0.3 per cent to 7,336, and the All Ordinaries index lost 0.26 per cent to 7,336.
Business continues call for more migration to solve worker shortage
By Sue Lannin
Amid Australia's worker shortages, the Australian Chamber of Commerce and Industry has upped its calls for the Federal Government to expand the skilled migration intake.
ACCI wants to see the target for permanent skilled migration increased to 200,000 places this financial year and next as the government reviews the migration system.
The employer group also wants all temporary skilled migrants to be eligible to apply for permanent residency, and it wants a $7,200 levy paid by large employers to bring workers in from oversea abolished.
There's no doubt that worker shortages are a big problem across the country, however, some employers are overlooking older Australians, people with disabilities, and migrants, including refugees, who struggle to get recognition for their education and skills.
And this story by political reporter Dana Morse shows that Indigenous Australians still face huge discrimination in the workforce despite the skills shortages.
Goldman Sachs set to lay off staff this week
By Sue Lannin
Reuters is reporting that Wall Street titan Goldman Sachs is getting ready for its biggest staff layoffs since the global financial crisis in 2008.
It says Goldman Sachs will start cutting thousands of jobs from tomorrow, just the latest banking giant to start shedding staff as the global economy slows down.
More than 3000 jobs are expected to go from a workforce of about 50,000 people.
Global investment banking fees nearly halved last year with $US77 billion earned by banks.
The value of mergers and acquisitions dropped nearly 40 per cent to $US3.66 trillion from a record $US5.9 trillion last year.
The Australian Financial Review is reporting that up to 12 staff could be laid off in Australia.
Asian markets mainly lower
By Sue Lannin
Markets in our region are in the red after two Federal Reserve officials said official interest rates needed to reach more than 5 per cent to curb US inflation and stay there for "a long time."
The Australian dollar has come off its overnight high of 69.49 US cents, trading around 69 US cents in afternoon trade.
The ASX 200 is down 0.3 per cent, the Shanghai Composite is down 0.2 per cent, the Hang Seng in Hong Kong has lost 0.5 per cent, but the Nikkei 225 is bucking the trend, up nearly 1 per cent.
Want to succeed at work? Show off!
By Sue Lannin
Confirmation that being a quiet achiever at work won't do you any favours.
Despite former US vice president Aaron Burr's advice to former US treasury secretary Alexander Hamilton in the Hamilton musical to "talk less, smile more" to get ahead, a study by Curtin University says "showing off" at work is the key to career advancement.
Dr Florian Klonek from Curtin's Future of Work Institute says that people looking to fast track their career in 2023 should seize any opportunity to demonstrate their skills.
“We found employees who put themselves ‘out there’ and actively seek situations that are opportunities to showcase their skills and abilities were subsequently awarded better quality tasks that allowed them to develop and grow more skills."
"On the flipside, workers who are concerned about appearing incompetent at work and therefore avoid performance situations were more at risk of showing a decline of skill use over time and had less chance of being granted greater responsibility in the workplace or promotion.”
So there you go. Shout about your talent from the rooftops and don't be a wallflower.
Here's the study which followed 238 nurses for four years if you want have a read (and no I wasn't just looking for an excuse to mention my all time favourite musical!).
US regulator fines former McDonald's ceo for misleading investors about sex scandals
By Sue Lannin
The US Securities and Exchange Commission charged and fined the former boss of fast food giant McDonald's with making false and misleading statements to investors about his termination.
Stephen Easterbrook was sacked in 2019 for poor judgment and having an inappropriate consensual relationship with an employee.
However, McDonald's paid Mr Easterbrook a $US105 million termination agreement ($152 million) saying that his sacking was without cause.
McDonald's then found that Mr Easterbrook had been involved in improper relationships with other women employed by McDonald's, and found he had emailed dozens of sexually explicit photos of the employees to himself.
It sued him to force repayment of his severance package.
The SEC fined Mr Easterbrook $US400,000 and banned him from being a company director for five years for violating the Securities Act and Securities Exchange Act.
Mr Easterbrook did not admit or deny the findings but agreed to the penalties.
McDonald's was found to have broken the law for shortcomings in its public disclosures relating to Mr Easterbrook's termination agreement, but was not fined.
"When corporate officers corrupt internal processes to manage their personal reputations or line their own pockets, they breach their fundamental duties to shareholders," said the SEC's director of enforcement, Gurbir Grewal.
"By allegedly concealing the extent of his misconduct during the company's internal investigation, (Mr) Easterbrook broke that trust - and ultimately misled - shareholders."
Market movers at lunchtime AEDT
By Sue Lannin
Here are the movers and shakers on the ASX 200 over lunchtime.
ASX weaker at midday after mixed session on Wall Street
By Sue Lannin
The Australian share market remains in the red at midday after Wall Street ended mixed.
The ASX 200 is down 0.3 per cent to 7,129 with nearly all sectors in the red.
Industrials, healthcare firms, and miners are among the losers today.
Recce Pharma rose nearly 8 per cent after it received a grant intent from the Australian Patent Office for its anti-virus agent.
Big banks remain higher, but the big miners are mixed with Fortescue Metals (0.1 per cent) higher, while BHP (-0.25 per cent) has lost ground.
Investors were a bit shaken after two Federal Reserve officials stuck with the official line that they expect the US central bank to raise official interest rates above 5 per cent this year before pausing and holding for "a long time".
Here's San Francisco Fed president Mary Daly in conversation with the Wall Street Journal.
We will get the latest on the Fed's thinking when chairman Jerome Powell speaks overnight and the latest US consumer inflation figures will be out later this week.
Meanwhile, US consumers are continuing to spend on credit despite higher borrowing costs.
Borrowing rose by $US28 billion in November according to the Fed, lower than in October, but more than expected.
Two workers sacked after fraud at mining contractor Austral
By Sue Lannin
UK listed Keller Group, the owner of WA mining contractor Austral, says its found that profits were deliberately overstated at the Australian business.
Two workers have been sacked after what Keller called "apparently deliberate and sophisticated financial reporting fraud."
"The financial reporting fraud relates to the overstatement of Austral's performance from 2019 onwards," Keller told the London Stock Exchange.
"An internal investigation is underway and we are in the process of appointing an external adviser to undertake an independent investigation."
Keller says profit was overstated by up to 16 million pounds ($28 million), and the fraud continued into the first half of 2022, which will affect its profit forecast for the year.
More details here from Keller Group:
How we're spending - and on what
By Daniel Ziffer
Hi team, just jumping in to tell you the ABS has been looking inside our wallets again, releasing the Monthly Household Spending Indicator.
Here's what it shows.... inflation:
- Household spending increased 11.4% through the year.
- In that year to November 2021, household spending increased for both services (+24.0%) and goods (+1.2%).
- Through the year, both non-discretionary (+17.1%) and discretionary (+6.3%) spending increased.
This is particularly notable, because 'non-discretionary' spending are the things you can't stop paying to live: things like food, housing, fuel.
It means people are spending more on the essentials.
And the impact has been felt most in our biggest states (NSW and Victoria) and in our most remote area, the Northern Territory.
That's particularly because the 'base' was set in November 2021 when our most populous states were in COVID lockdowns, so there was less spending on services.
Here's the figures for where you are.
Protests by Tesla owners in China who missed out on discounts
By Sue Lannin
Tesla has been cutting the prices of some models of its popular Model Y car to boost sales.
It cut prices in China on Friday by up to 13.5 per cent for its rear wheel drive and long range versions of the Model Y.
Reuters reports that has seen waiting times for the models lengthen by a week according to the Tesla website.
But buyers who missed on the discounts are unhappy saying they overpaid for their electric cars.
Hundreds of Tesla owners gathered at the company's showrooms and distribution centres in Chinese cities over the weekend demanding refunds.
Tesla prices have fallen by up to one quarter since September in China.
Tesla told Reuters that it had no plan to compensate buyers for the discounts they missed out on.
Here's more on the protests from Reuters.
ASX movers and shakers
By Sue Lannin
Here are the top movers in the first hour of trade on the ASX from Refinitiv.
ASX opens lower
By Sue Lannin
The Australian share market has opened in the red after a mixed night on Wall Street.
The ASX 200 index is down 0.1 per cent to 7,346 at 10:10am.
Leading the losses are industrial firms, miners and oil stocks with most sectors in the red.
Going up are tech firms, education stocks, and utilities.
The Australian dollar is holding around 69.07 US cents after rising to nearly 69.5 US cents overnight.
More top executives leave Fortescue
By Sue Lannin
There's been a big shakeup at iron ore giant Fortescue Metals since it expanded into critical minerals and rare earths, as well as renewables, with plans to produce green hydrogen.
A string of senior executives have left the company over the past year with chief financial officer, Ian Wells, the latest to resign.
Mr Wells will step down as chief financial officer at the end of the month and will not present the big miner's upcoming profit results.
He joined FMG in 2010 and has held various senior executive roles becoming CFO in 2018.
Fortescue told the ASX that Mr Wells has resigned to "pursue other opportunities."
FMG founder and executive chairman Andrew "Twiggy" Forrest praised Mr Wells.
"Ian has made a huge contribution to Fortescue over what we will look back on as the formative years of Fortescue," Mr Forrest said.
"Ian has been a trusted member of the executive team which has led Fortescue through a number of iron ore market cycles, more recently the impacts of COVID-19 together with global volatility."
Former Reserve Bank deputy governor Guy Debelle stepped down from FMG's renewable energy arm, Fortescue Future Industries, after a serious bike accident, and former chief executive Elizabeth Gaines resigned in August last year, although she remains on the FMG board.
Former Woodside Energy executive Fiona Hicks will become the new chief executive next month.
Here's an interview I did with Mr Forrest back in 2021 and his plans to export green hydrogen.
US stocks end mixed and Tesla jumps
By Sue Lannin
US stocks have ended off the day's highs with investors worrying about inflation, while hoping that the Federal Reserve will ease off on its interest rate hikes.
The Nasdaq pulled back from its earlier highs, where it jumped more than 2 per cent as electric car maker Tesla saw longer waiting times for some models in China after price discounts seemed to have fueled demand.
Tesla cut prices by 6 to 13.5 per cent on Friday on some of its Model Y cars in China.
Tesla shares rose nearly 6 per cent to $US119.77 overnight.
The Dow Jones index fell 0.3 per cent to 33,518, the S&P 500 gave up its earlier gains, and finished down nearly 0.1 per cent to 3,892, while the Nasdaq rose 0.6 per cent to 10,636.
Brazilian shares higher in volatile trade after capital stormed
By Sue Lannin
Reuters reports that the Brazilian market rose, a day after thousands of supporters of former President Jair Bolsonaro stormed government buildings in the capital Brasilia.
The shocking scenes were reminiscent of the January 6, 2021 insurrection by Donald Trump supporters in Washington.
The Brazilian currency, the real, weakened against the greenback, while the stock market index Bovespa has increased 0.2 per cent to 109,130 after falling earlier in the day.
The real is buying 5.25 US cents.
The coordinated invasion on Sunday afternoon overwhelmed law enforcement and severely damaged the Supreme Court and other locations.
Empiricus analyst Matheus Spiess says the shockwaves could affect Brazil's economic policy under new president Luiz Inacio Lulu da Silva.
"We were surprised to see the level of violence," he said.
"Brazil's stock exchange had detached from that noise about potential institutional rupture, so we can definitely see some negative effects."
But William Jackson, chief emerging markets economist at Capital Economics, said the riots could strengthen the new president's position.
"The riots could result in a long-lasting risk premium on the country's financial assets, particularly if they prompt President Lula to double down on his economic agenda," he said.
Here's more on what happened from Reuters via ABC News.
Nasdaq jumps thanks to Tesla
By Sue Lannin
Good morning, welcome to the ABC Markets Blog. I'm Sue Lannin.
Join me today for all your markets and business news.
Technology shares have boosted the Nasdaq and S&P 500 overnight, and the Australian dollar is heading to 70 US cents.
The Australian market is set to open flat after making ground yesterday.
Grab a coffee and let's go.
