Mega-mergers stoke ASX; Federal MP attacked; Putin-Xi-Trump summit

Mega-mergers stoke ASX; Federal MP attacked; Putin-Xi-Trump summit

News in brief

Federal MP attacked: Federal independent MP Helen Haines has been run down by a four-wheel drive outside her Wangaratta electorate office, in what Prime Minister Anthony Albanese described as a deliberate attack. The motive remains unknown, and police and intelligence agencies are investigating. The attack follows growing concerns about politicians’ safety, with violent threats against MPs almost doubling in two years.

 

RBA says A$ can fight inflation: Reserve Bank assistant governor Christopher Kent says higher interest rates are slowing the economy, but it remains unclear whether they're restrictive enough. He also highlighted the Australian dollar's role in controlling inflation, with a stronger currency reducing import costs, including petrol prices.

 

Stockland feels the housing slowdown: Property developer Stockland has reported a 22 per cent fall in quarterly housing sales, with buyer inquiries almost halving over three quarters. Higher interest rates, affordability pressures and tax changes are weighing on demand.

 

Putin’s three-way peace summit: Russian President Vladimir Putin has proposed meeting Donald Trump and China's Xi Jinping next month to negotiate an end to the Ukraine war. The Kremlin says discussions are underway, although nothing has been agreed. Ukrainian President Volodymyr Zelensky has warned his country cannot prevail if Washington sides with Moscow.

 

Japan sets its sights on Martian moon: Japan is launching an ambitious mission to collect material from Phobos, one of Mars' two moons. The spacecraft aims to return just ten grams of material to Earth in 2031, landing in South Australia's Woomera desert. Scientists hope the samples will help explain how Mars acquired its moons.

Fear-o-meter

RBA Assistant Governor Chris Kent when asked about the unemployment rate hitting 4.7pc.

 

“I’d always be a bit cautious about the monthly numbers. They’ve always been volatile, even putting aside these sort of questions about changes in the survey which have had effects of late.

 

“But even having said that, there are indicators where the labour market has become less tight a bit faster than we might have forecast.

 

“And I think a really important question here, is that because demand is weakening maybe a bit more than you might have thought for labour? Or is it because are there still these pressures in terms of costs of labour still rising too greatly?”

Fear & Greed Q+A today

On why El Niño could force the RBA to raise rates again:

 

“The challenge at the moment is that we've already got inflation that's too high and it's been too high for a persistent period. We've had the trimmed mean, the RBA's preferred measure of inflation, now above the midpoint of the target band, above two and a half, for four and a half years, and it's sitting around that three and a half per cent mark at the moment.

 

And that's before we think about all the things that are coming. We've got this energy shock that's going on globally as a result of the Middle East conflict and the Russia-Ukraine war that's ongoing as well. That doesn't seem to be disappearing anytime soon.

 

And then you overlay on top of that, we've got this El Niño event as well playing out that could be upside risk for commodity prices, for food prices, and potentially for the cost of insurance.

 

The fundamental challenge for Australia is that productivity growth is very weak, and so the supply side's very constrained. All of these forces look as though they're acting in the same direction, which is unfortunate, that they put more upward pressure on inflation at a time when inflation's already been high for a sustained period.

 

So I think it all contributes to the idea that the RBA is gonna probably have to lift interest rates further yet, and that's the view that we've got.”

Mega takeovers stoke the ASX

 

It’s been a quiet year for companies listing on the Australian sharemarket, but takeover activity is booming. Yesterday brought another wave of multibillion-dollar deals, led by a $7.8 billion proposal from Japanese insurance giant Daiichi Life to buy retirement income specialist Challenger.

 

Daiichi already owns about 20 per cent of Challenger and a 17.7 per cent premium to Challenger’s one-month average share price, sending its shares up 18 per cent yesterday. The board is considering the offer.

 

Meanwhile, Swedish private equity group EQT has struck a $9.3 billion deal to acquire waste management company Cleanaway, with the board recommending the takeover. Coal producer New Hope also announced a $1.8 billion acquisition of Malabar Resources.

 

And there could be more to come. Gold Fields is pursuing Northern Star, Brookfield is working towards a takeover of Reliance Worldwide, and Austal’s US shipbuilding business is attracting competing bidders.

 

For investors, the takeover boom is a reminder that while companies may be reluctant to float on the ASX, international buyers still see plenty of value in Australian businesses.

Greed-o-meter

Fund category	Sept %	FYTD %	1 year %
All Growth	-0.6	1.3	7.7
High Growth	-0.4	1.2	7.2
Growth	-0.4	0.8	6.3
Balanced	-0.4	0.5	5.2
Conservative	-0.4	0.1	3.8

Source: Chant West. Median returns to 30 September 2026, net of investment fees and tax, before administration fees.

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Australian super funds went backwards in September, with the median growth fund losing 0.4 per cent, according to Chant West. Falling sharemarkets, rising bond yields and inflation concerns weighed on returns, although a weaker Australian dollar helped cushion the losses. Despite the setback, the typical growth fund remains up 0.8 per cent for the financial year to date.

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