ASX at the close

Stan Shamu for Chris Weston, Chief Market Strategist at IG Markets Calmer heads prevail While many market participants are still surprised about the fairly orderly response to the Greek ‘no’ vote, it certainly seems calmer heads have prevailed for now with a glass-half-full approach being taken. One of the key events following the referendum was

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Bill Evans on the RBA rate decision

From Westpac’s chief economist, Bill Evans: As expected the Reserve Bank Board left the cash rate unchanged at 2% at its July Board meeting. There were very few changes in the Governor’s statement from the statement following the June Board meeting. Even though the Australian dollar has declined from around USD0.77 at the June meeting


China households are not exposed to shares

From HSBC: The Shanghai Composite Index has fallen 27% since 12 June 2015, a sharp drop versus the 117% jump over the previous eight months. These dramatic swings have raised concerns about a possible negative impact on the economy. In this note we look at the main channels through which equity market volatility can affect


RBA holds with mealy-mouthed bias

The Reserve Bank of Australia has released its July meeting outcome and has decided to hold rates steady: At its meeting today, the Board decided to leave the cash rate unchanged at 2.0 per cent. The global economy is expanding at a moderate pace, but some key commodity prices are much lower than a year


Labor, Nationals put heat on TPP trade deal

By Leith van Onselen Labor and the Nationals have stepped-up pressure on the Trans-Pacific Partnership (TPP) deal, which is in the final stages of negotiation. Fearing the deal will raise significant costs to consumers and taxpayers, Labor spokewomen on trade, Penny Wong, and shadow assistant treasurer, Andrew Leigh, have jointly called on the Government to


Immigration continues to fall

By Leith van Onselen The Australian Bureau of Statistics (ABS) has released visitor arrivals and departures data for the month of May, which registered further falls in net long-term and permanent migration into Australia. In the year to May 2015, there were 687,130 permanent and long-term arrivals into Australia – down from the record 792,500


Shanghai opens, crashes (updated)

Shanghai is now down 3%: Led by Chinext which is still down 5%: Unstoppable. From the AFR: Trading was halted in more than 25 per cent of Chinese listed shares on Tuesday, in what appeared to be the latest government-backed attempt to shore up the country’s plunging equities markets. The suspension of more than 700


The population monster that’s swallowing Melbourne

By Leith van Onselen Over the past decade, Melbourne has dominated the nation’s population growth, leading the way in each and every year since 2004 (see next chart). With the Victorian manufacturing sector in decline (and now facing near extinction), the Government in the mid-2000s effectively turned to selling citizenship and immigration to drive economic


Construction PMI recession deepens

The Australian Industry Group (AIG) has released its Performance of Construction Index (PSI) for June, which reveals that Australia’s construction sector finished the financial year in recession, recording a reading of 46.4, down 1.4 points from May: The national construction industry contracted at a steeper rate in June, as weaker engineering activity continued to outweigh


Measuring Port Phillip’s iron ore happiness

Another dubious report out today from an economic consultancy engaged in a rent-seeker’s fight. This time it’s Port Phillip Partners and the customer is RIO and the Minerals Council: The Australian iron ore industry has capitalised on a decade of unprecedented volume and price growth to create a market position stronger after the commodities boom than


Productivity Commission calls for super reform

By Leith van Onselen The Productivity Commission (PC) has joined the conga line of experts – including Financial System Review head David Murray and the Australian Treasury – calling for reform of Australia’s superannuation system. In a research paper entitled Superannuation Policy for Post-Retirement, the PC reiterates how population ageing will greatly increase the demands


EZ gives Greece one last chance, lol

From the FT: Athens will be given a final chance to present a new reform plan to eurozone leaders on Tuesday night despite a hardening attitude to Greece in many capitals after the emphatic rejection of previous bailout terms in Sunday’s referendum. But eurozone officials said leaders were unlikely to agree to restart rescue talks


Why gold is going nowhere

From Miranda Maxwell at Dad’s Army: In a volatile period for global markets, gold has been a nonstarter, failing to sustain a rally this month even as Greece proudly voted for noone-knows-precisely-what, and China’s stock market crashed causing “horror and anxiety.” …Surely that’s a time to embrace a safe haven? Indeed the US dollar hit


Treasury releases foreign investment reforms

The Australian Treasury yesterday released the Exposure Drafts and Regulatory Impact Statement of legislation designed to tighten foreign investment rules, including those relating to residential real estate. On 2 May 2015, the Government announced a package of reforms to strengthen the foreign investment framework, including: stronger enforcement of the foreign investment rules by transferring all


China’s centrally planned stock bubble fail

From Investing in Chinese Stocks comes a great line up of centrally-planned margin lending fails: December 2014: The shadowy trading behind China’s stock market boom This mania for margin trading—which allows individual investors to borrow from the broker to up the amount of their stock bets, magnifying the size of gains and losses—is a new thing.