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Welcome to HotCopper’s weekly wrap for Week 37 where it’s been another broadly dry week for the ASX200 as opposed to Wall Street, which appears to be tracking along per usual. That of course might not be too surprising given the stock market tends to retreat a little every September; so far, we’re not seeing any evidence that historical rule has changed.
(That’s somewhat to my chagrin, given not that long ago I pondered in this column whether or not such dogmas would remain true in 2025.)
Looking at big catalysts coming up next week, the US Federal Reserve meets in mid-September to decide on an interest rate decision where it’s widely expected the central bank for the world’s #1 economy will slash rates, possibly by 50 basis points.
That’s in response to a markedly weaker jobs market. At the same time, however, inflation is increasing in the US – the latest data reflected a seventh month high, which is undeniably driven largely by tariffs – but that doesn’t appear to be too influential right now in impacting investor psychology. (Keywords: ‘right now.’)
At any rate, it’s likely a Fed cut could put Australian investors down under into a better mood, although we currently seem to have divorced ourselves from America – perhaps unusual, given most traders at home and abroad take cues from whatever Wall Street is doing.
Looking at news from home, the biggest item this week was probably the fact more Big 4 banks are moving to slash anywhere from hundreds to thousands of jobs (as was the latter case for ANZ), that’s largely because AI technology continues to creep into workplaces across the country. Or at least, that’s a good enough excuse to rationalise a downsize.
Worth noting is ANZ’s new CEO appears to be on a cost cutting mission and was determined to come in swinging regardless of how popular ChatGPT might be. Could be he’s just enthusiastically positioning himself as a ruthless operator for street cred at the VIP Lounge, because AI chatbots are on the whole fairly useless unless you’re in Year 9.
But the biggest news for ASX market takeaways, in my view, has nothing to do with banks or the Federal Reserve or historical market data, but instead what we’re seeing right now from a lot of ASX juniors increasingly moving into critical metals recycling.
Whether you’re recycling solar panels; e-waste like computer motherboards, or other high tech spent assets, the ‘circular economy’ – a key perceived value prop of the green and/or ethical investor – has come back onto the radar, if you’re harvesting critical minerals that are required for defence manufacturing supply chains.
In that way, ESG investing is cool again so long as you’re recycling materials for war. The chaos of markets often has a poetic irony to it, and the fact that socially responsible investment narratives are bouncing back on the wings of long-distance strike-capable drones and other lethal devices definitely evidences that.
