by Paul Sanger
At noon, the S&P/ASX 200 is 1.06 per cent or 72.30 points lower at 6770.60.
The SPI futures are pointing to a fall of 68 points.
Best and worst performers
All sectors are in the red. The sector with the fewest losses is Information Technology, down 0.05 per cent. The worst-performing sector is Energy, down 2.71 per cent.
The best-performing stock in the S&P/ASX 200 is Reliance Worldwide (ASX:RWC), trading 3.48 per cent higher at $3.71. It is followed by shares in Life360 (ASX:360) and Computershare (ASX:CPU).
The worst-performing stock in the S&P/ASX 200 is Atlas Arteria (ASX:ALX), trading 8.75 per cent lower at $6.66. It is followed by shares in De Grey Mining (ASX:DEG) and Ramelius Resources (ASX:RMS).
Asian markets
Shares in the Asia-Pacific have fallen as investors digest US economic data and look ahead to the release of China’s industrial production and retail sales figures for August.
The offshore Chinese yuan weakened past 7 against the dollar overnight, and last changed hands at 7.0163 after reaching 7.0213 earlier in the session.
The Nikkei 225 in Japan has fallen 1.17 per cent, and the Topix index has slipped 0.74 per cent.
South Korea’s Kospi has shed 0.63 per cent and the Kosdaq has lost 0.46 per cent.
Hong Kong’s Hang Seng index has fallen 0.8 per cent. The Shanghai Composite in mainland China has slid 0.38 per cent and the Shenzhen Component is 0.28 per cent lower.
MSCI’s broadest index of Asia-Pacific shares outside Japan is 0.75 per cent lower.
Nothing new from RBA Governor Lowe
No major revelations from RBA Governor Lowe’s remarks before a parliamentary committee. Expects further rate hikes to return inflation to target, but it will be appropriate to slow pace of tightening at some point and policy is not on a pre-set path. Stressed need to keep inflation expectations contained and avoid wage-price spiral. Pointed out medium-term inflation expectations remain well anchored, and stronger wages growth has not been a major driver of inflation. Highlighted economic weakness abroad and conceded difficulty of achieving soft landing if there is further material bad news on the global economy. While recent data suggests spending has remained resilient amid a tight labour market and strong financial buffers, Lowe repeated considerable uncertainty around how these factors will balance out over the months as household budgets come under pressure from higher rates and inflation.
Xi-Putin meeting reaffirms close ties
Xi-Putin meeting on the sidelines of the Shanghai Cooperation Organization summit drew attention, though there were no major takeaways. Xi said China is ready to work with Russia in extending strong support to each other on issues concerning their respective core interests (Xinhua). China will work with Russia to deepen practical cooperation in trade, agriculture, connectivity and other areas. Putin said he appreciates Beijing’s “balanced position” on Ukraine (Nikkei). Also expressed firm commitment to the one-China principle and condemned provocative moves by individual countries on issues concerning China’s core interests. Focus was on whether they would reveal any notable advancement in bilateral ties after having declared a “no limits” relationship weeks before Russia invaded Ukraine. But Eurasia analysts suggested Putin was unlikely to get much more out of Xi than trade and investment deals.
South Korea adds to FX verbal intervention
FT reported Finance Minister Choo Kyung-ho flagged South Korea reviewing “contingency plans” to tackle foreign exchange volatility, with the won hovering at a 13-year low against the dollar as currencies across Asia come under pressure from an increasingly hawkish Fed. Said authorities would take necessary measures if there was excessive volatility. Story recalled BOK warned this month that the won’s recent fall had been too fast relative to the country’s economic fundamentals. Analysts expected won to continue depreciating until year-end, dragged down by Fed tightening and Seoul’s ballooning trade deficits. Cited Korea Capital Market Institute’s view that Asian currencies will remain under pressure for the time being as the Fed continues its outsized rate hikes, contrasting with easing bias in Japan/China while South Korea has shifted to smaller moves.
Japan LDP policy chief Hagiuda calls for $209b stimulus to combat inflation
Sankei reported LDP policy chief Hagiuda at a party meeting called for JPY30T ($209b) in stimulus to address higher cost of living. Argued that measures should at least match the JPY30T-plus delivered in supplementary budgets last fiscal year against the backdrop of ongoing inflationary pressures, softening global growth, and yen weakness. Suggested funding should draw from reserves, extra budgets, as well as expand the next FY general budget if necessary. Stimulus talk has subsided over the past week after Prime Minister Kishida ordered a fresh economic package in October with the possibility of an extra budget. Main features are a JPY50,000 cash handout program for low-income households, as well as extensions of measures to regulate gasoline and imported wheat prices at current levels. Guidance on funding has been limited to JPY3.5T out of reserve provisions with the total package size yet to be determined.
Company news
Australian oil and gas explorer and developer Red Sky Energy (ASX:ROG) today provided notification on the current progress with its Yarrow well at the Innamincka Projects. Commenting on the progress, Red Sky Managing Director, Andrew Knox, said: “Red Sky is pleased that the Yarrow 3 gas well has commenced drilling last night. The activity aims to test the extent of the gas accumulation at the Yarrow gas field, and we look forward to providing the results once received.” Shares are trading 16.7 per cent higher at 1 cent.
Desert Metals (ASX:DM1) today announced the confirmation of a significant rare earth discovery at the Innounendy Project located in the Narryer Terrane in WA. First assay results from the initial aircore and RC drilling program have been received and confirm the presence of thick and continuous rare earths mineralisation lying close to surface and indicating a potentially significant mineralised system. Managing Director Rob Stuart commented: “This is a great result for the Company to confirm a significant rare earth discovery at an early stage in the exploration programs at the Innouendy Project. The mineralisation assayed to date is showing encouraging grades over significant widths from close to surface. The drill program extends over a 20km area, so we look forward to seeing just how large this system becomes as the remaining 11,000m of assays are returned over the coming weeks. Once all assays are compiled we intend to return to the field as soon as possible to execute a more expansive drill program to test the extent of this exciting discovery.” Shares are trading 44.6 per cent higher at 60 cents.
Mamba Exploration (ASX:M24) today provided an update on the results of the reprocessing of the Ashburton / Gascoyne regional radiometric data. The reprocessing and rebalancing of the thorium radiometric data have highlighted at least eight distinct anomalies within the company’s Ashburton / Gascoyne Project tenements located in the upper Gascoyne region of Western Australia. Commenting on the data reprocessing, Managing Director, Mike Dunbar said: “The Gascoyne has long been the “forgotten” part of the mineral endowment of Western Australia. Thanks to the recent discoveries in the region made by Dreadnought and Kingfisher, this has finally changed, and we are pleased that the potential is starting to be recognised.” Shares are trading 36 per cent higher at 17 cents.
Radiopharm Theranostics (ASX:RAD), a developer of a world-class platform of radiopharmaceutical products for both diagnostic and therapeutic uses, is pleased to announce that the US Food & Drug Administration has granted Rare Pediatric Disease (RPD) Designation for its DUNP19 technology for the treatment of osteosarcoma. The RPD program is aimed at advancing development of drugs with the potential to treat serious, rare paediatric diseases. Riccardo Canevari, CEO and Managing Director of RAD, said: “This is again excellent recognition of the work to date by Dr David Ulmert and his team and the potential for DUNP19 to make a significant difference to young patients in need. The RPD and associated PRV can be incredibly valuable and we look forward to progressing the DUNP19 program and eventually taking advantage of this.” Shares are trading 9.09 per cent higher at 18.5c
Commodities and the dollar
Gold is trading at US$1663.45 an ounce.
Iron ore is 0.2 per cent higher at US$101.05 a tonne.
Iron ore futures are pointing to a fall of 1.2 per cent.
One Australian dollar is buying 67.00 US cents.
