ASX News LIVE | XJO Set for Strong Day Following Wall St Rally; Meridian, Metcash and AQZ feature

The ASX 200 closed today up 1.29%, at 7,279.0, with broad gains across the market. All sectors were in the green by the end of the day, with all ords up 1.3% after positive news out of China buoyed sentiments.

The price of iron ore jumped to its highest price in the past six months which saw shares of Rio Tino up 3%, while Fortescue finished over 4% up today, ending the week up almost up 10%.

That’s all from me today, have a great weekend!

As his socials are now locked, I have to pass on his tweet via a secondary account, but here is millionaire property developer Tim Gurner’s response to his controversial statements made this week at the AFR Property Summit on Tuesday.

In a now viral clip which is shared in the previous post he has caught headlines around the world when he called for unemployment to rise ’40-50%’ and called workers ‘arrogant’.

I deeply regret that everyone heard what I really think and oddly those outside a room of property developers weren’t so on board. pic.twitter.com/JCuSqaXsuH

— Greg Jericho (@GrogsGamut) September 14, 2023

Property developer Tim Gurner gained the ire of the internet this week after accusing workers of becoming ‘arrogant’ and suggesting unemployment in Australia needed to jump 50%.

Now, unemployment figures are back in the spotlight, with the latest statistics from the ABS showing unemployment remained at 3.7% while the participation rate increased to 67%.

Here’s an interesting chart breaking down the evolution of employment in Australia by demographic.

https://twitter.com/MattCowgill/status/1702215106183287247

The yield on Australian bonds is typically lower than the yield on Australian equities, for good reason. Bonds are considered to be a lower-risk investment than equities.

That typical overperformance of equities is often referred to the ‘risk premium’. Investors demand and seek higher returns on riskier investments to compensate for the possible loss of capital.

We are in an interesting period where the difference between the two is lower than it has been for over a decade.

As we sit on the end of the tightening cycle, it’s going to be worth watching where this goes from here.

Will equities rise back out of the ashes?

Difference between the yield on Aussie bonds and Aussie equities (grey line) via DB… pic.twitter.com/sv8tHWd4BU

— christopher joye (@cjoye) September 13, 2023

Arm Holdings Plc climbed 25% in its trading debut after raising nearly $5 billion in the year’s largest initial public offering to date.

It’s great news for equity markets and Softbank Group, which acquired Arm in 2016 for $32 billion.

After an initial deal to sell Arm to Nvidia for $40 billion fell through in 2022, the company has held onto Arm, awaiting a good time in the markets, which came and went last year.

‘The markets of last year didn’t really cooperate,’ Arm’s CEO Rene Haas said in an interview. ‘In terms of where we landed the plane, relative to where we thought we were six to nine months ago, we, we landed in a great place.’

The chip designer’s shares closed at $63.59 in NY trading overnight, giving Arm a market value of over $65 billion.

The IPO is a great litmus test for the market’s appetite for tech stocks more broadly. It shows the Nasdaq rally still has some legs as both retail and institutional investors eye the potential of AI and semiconductor stocks.

Investors in the IPO included some of Arm’s major customers, including Intel, Apple, Nvidia, Samsung and TSMC.

Here’s the latest episode of our weekly podcast, where Greg and I talk about inflation.

Is inflation re-accelerating? Will rising oil prices push central banks to raise rates further?

Is a recession now unlikely? And are markets overvalued?

These are the meaty questions we grappled with in this episode.

As for what’s not priced in? Recession remains a risk the market continues to under-price, at its peril.

The ASX 200 opened up 1.31% in what looks to be a very positive day trading.

A strong rally overnight saw the S&P 500 up by 0.84% and the Nasdaq up by 0.81% as US retail sales rose more than expected in August.

‘Today’s economic data confirms the path toward a soft landing, but without being so hot that the Fed thinks they might need to do a couple more rate hikes,’ said Ross Mayfield, Investment Strategy Analyst at Baird. ‘All together, it’s pretty bullish.’

European stocks leapt to their biggest one-day percentage gains in six months after the ECB raised interest rates for the tenth straight time but suggested it was at the end of its monetary tightening cycle.

Oil prices continue to surge to their highest prices since last November as tight supply continues to weigh on markets.