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What was the big story this week?
In my view, it’s that the ASX closed on Friday at 7,931pts. We’re slowly creeping back to the 8,000pts level we clocked in mid-Feb.
When it comes to the geopolitical soup that is our current moment, there was one interesting thing to come out of Week 12.
Out of the blue, it seems, we might be about to become pretty good friends with Canada, at least when it comes to trade in the defence sector. Right now, Australia is considering selling a $6B over-the-horizon radar system to….Canada.
Last October, that might have sounded like a pretty crazy proposition – something I noted in this week’s HotCopper Market Watch podcast.
How fast things change. (An over-the-horizon radar, for those playing at home, is basically a wall of tall antennas that detects objects, well, over the horizon.)
And what about the ASX itself?
Woolworths and Coles shares showed they are resilient in the face of a fairly underwhelming ACCC report following twelve months of inquiry into the supermarket duopoly.
Elsewhere, South Korean shipbuider Hanwha made a move to acquire 9.9% of Austal after targeting the company in previous takeover attempts in recent history. (Personally, given how many Navy ships we don’t have, I think we may as well let South Korea do it for us.)
Shorts on Guzman Y Gomez have also climbed just above 6% for the first time, suggesting growing scrutiny around the market capitalisation of that Mexican fast food chain apparently gunning to compete with McDonald’s.
Talking of McDonald’s: we saw the Federal Trade Minister this week joke Australia may put tariffs on beef sent to the US, of which much goes into McDonald’s burger patties, reportedly mixed in with American meat to give the patties ‘structure.’
So far, we’ve fallen short of formally using the word tariffs – just in a joking sense. But Anthony Albanese is talking about “Buy Australian,” and some expect to see budgetary measures to that end.
What those measures could be, exactly, remains anyone’s guess. A stimulus check to buy Vegemite is probably out of the question.
Overseas news
I’m getting tired of talking about Trump – he’s less funny this time around – so let’s just bash this one out.
The US Fed kept rates on hold this week, sensibly, given the fallout of Trump’s existing and soon-to-be-enforced tariff regime hasn’t even manifested yet.
China’s PBOC did the same, so there’s a signal from two major economies and harmonises with expectations the RBA isn’t going to make another cut until around the half point of 2025.
New Zealand, meanwhile, has finally exited a recession with stronger Q4 data looking a little bit tastier, as far as economic growth is involved. Presumably that’s tasty.
Bismuth prices boom
Another week, another obscure metal becoming a mainstream darling due to Chinese export curbs. This time?: Bismuth. Yes, the weird little shiny rainbow rock gem collectors like. Turns out it’s also a tech metal. Go figures.
A better known metal, copper, this week touched US$10K/tn as a combination of Trump tariff threats and Chinese demand expectations came together to push up prices.
Meanwhile, cobalt continues to surge as the Congo shows the world Donnie isn’t the only one who can rattle markets around.
That’s all for this week. Have a great weekend, and we’ll see you on Monday.
Australian Equities
Arafura locks in BOA for NdPr with Traxys for presumed 2029 start
South Korea’s Hanwha takes another go at Austal, picking up 9.9% of shares
Shorts on Guzman Y Gomez clock just over +6% as doubters pick up pace
Australian Economy
ANZ senior econ sees no RBA rate cut til Aug as NAB CEO flags tariff uncertainty
Oz unemployment rate stays flat at 4.1%…
But job losses surprise with a -53,000 fall – while positions up +260K YoY
International Equities
Nike believes sales will plunge this quarter on tariff chaos, lower confidence
NYSE-listed services firm Accenture plunges as DOGE cuts US gov’t contracts
International Economies
US Fed keep rates on pause as tariff uncertainty weighs
And the PBOC follows, with Chinese interest rates (1Y prime) at 3.1%
NZ finally exits recession with Q4 GDP looking healthier
Commodities
Copper touches US$10K/tn on Thursday ahead of widely expected Trump tariffs
Bismuth the latest mineral to soar following new Chinese export curbs
Cobalt goes crazy as Congo curbs exports – and once again flags minerals-for-peace proposals
Geopolitics
ThyssenKrupp expects shipbuilding division to triple as EU defence pact momentum builds
Australia could be about to ink its biggest ever defence export with Canada
Regulatory, Odds & Ends
Greenpeace ordered to pay A$1B in damages to pipeline company by North Dakota court
Australia unveils new crypto regulations, but individual traders needn’t worry
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