Wages growth slows, ASX falls, Commonwealth Bank logs flat first-quarter profit — as it happened

That's it for the ABC's markets blog today.

Thanks for joining us.

We'll bring you the latest from Wall Street first thing in the morning, the ASX when trading opens, before analysis of the latest monthly ABS jobs figures from 11.30am AEDT.

  The Australian share market has closed lower on Wednesday.

The ASX 200 lost 0.7 per cent to end the day at 8,193 points. 

The worst-performers on the main index were Life360 (-7.9%) and Mineral Resources (-7.1%). 

Interestingly, family tracking app Life360 today announced it will allow its 77 million users to track their pets and elderly relatives.

This time the news at MinRes wasn't about founder Chris Ellison (you can refresh your memory about that here).

Instead, today MinRes announced it would mothball its Bald Hill operations after a slump in the lithium price.

The decision to close the lithium mine will affect 300 jobs.

On the upside, Paladin Energy and James Hardie Industries were the top two stocks.

Here's a snapshot of the top and bottom movers:

And here's how the sectors finished up on Wednesday.

Hi, Kirsten Aiken here, dropping in to tell you about the terrific line-up we have on today's program.

I popped down to the World Business Forum at Sydney's Darling Harbour earlier to chat to the economist who predicted the global financial crisis, Nouriel Roubini. You may have heard him referred to as Dr Doom.

He's been warning there is a chance of stagflation under the Trump administration if the President-elect implements his full economic policy agenda including 60% tariffs against exports from China.

But Professor Roubini says he hopes good sense will prevail in the White House in order to avoid the rather difficult to address combination of stagnant economic growth, high unemployment and high inflation.

He also gave some timely advice to the federal government on enhancing productivity, something the Treasurer was talking about at the very same moment across town. David Taylor will have more.

And finally Daniel Ziffer will bring us more on ASIC's legal action against Cbus for allegedly delaying the payment of thousands of death and disability claims.

Watch ABC News at 8.44pm, after the late news on ABC TV, and anytime on ABC iView.

See you later on!

The newly-installed chief executive of Optus has promised to weed out and sack staff who fail to meet the telco's ethical and legal standards.

In his first broadcast interview since being appointed, Stephen Rue spoke with the ABC's senior business correspondent Peter Ryan.

Tune into tonight's PM on ABC Radio National  (530pm AEDT) and ABC Local Radio (630p, AEDT) for a listen.

Mr Rue - the former CEO of the NBN Company - inherits a reputational and legal crisis after Optus sales staff in Darwin and Mount Isa were accused by the ACCC of exploiting indigenous Australians and people with disabilities - selling them mobile gear they didn't want, didn't need and couldn't afford.

"I just want to be clear that there is no place in our company for any employees or franchisees who engage in misconduct against customers," Mr Rue tells Peter Ryan.

"Any employees that were engaged have already been removed from the company.

"We continue to rebuild trust with our customers - this is not who we are. This is not the culture of the organisation - this is not why people came to work out Optus."

The Housing Industry Association released its Economic and Industry Outlook report earlier today.

It makes for some interesting reading about the constraints on construction.

In short: The outlook for new houses next year looks pretty good, but building apartments isn't getting any easier, mainly due to the high cost of construction that have eroded profit margins in that sector. 

HIA Senior Economist, Matt King, notes:

“While activity is picking up, the varied nature of activity levels across capital city and regional markets continues to be pronounced.

"We have confidence that new home building activity across most markets will continue to improve as we transition into the new year. However, Sydney remains an outlier and there is still no indication of a near-term rebound in both detached house and multi-residential building.

“New home building in the Sydney basin remains exceptionally low, primarily doe to exceptionally high land prices and an ongoing excessive impost of housing taxes and infrastructure charges.

“Despite ongoing supply side constraints, Perth, Adelaide and South-East Queensland continue to lead the way in new contract sales and building approvals," Matt King notes.

HIA's well-timed report comes as today the federal government announced a new $900 million government fund would give grants to states and territories if they enact productivity-enhancing policies, such as slashing red tape in housing construction.

Australia's largest gambling company Tabcorp has been fined again.

The Australian Communications and Media Authority (ACMA) found Tabcorp accepted 854 in-play bets across 69 tennis matches between April and October 2023. 

Tabcorp will be forced to pay $262,920 for taking online in-play sports bets — which is illegal in Australia.

Online in-play betting are bets made on a sporting event after it has started.

ACMA member Carolyn Lidgerwood said the ban on online in-play betting is in place to protect vulnerable people.

“In-play betting increases access to gambling opportunities and exacerbates the risks of gambling harm, as people can place bets with high frequency on multiple outcomes during sporting events,” Ms Lidgerwood says.

Tabcorp told ACMA the breaches occurred due to a technical ‘bug’ in its systems.

However, while the in-play bets first occurred in April 2023, it was not fixed until October 2023.

Tabcorp's shares have fallen 6 per cent today to just under 50 cents.

Tabcorp was previously issued a formal warning by the ACMA in November 2021 for accepting in-play bets on a United States college basketball game.

In August, Tabcorp was fined $4.6 million by the Victorian Gambling and Casino Control Commission (VGCCC) and ordered to "transform its operations" after being found to have repeatedly breached the state's gambling code.

Thanks for the comment David.

Here's a handy infographic from the Department of Industry, Science and Resources' September quarterly report.

 The United States isn't a major gold importer so on the face of it any tariffs it may impose on gold would have a minimal impact on Australia's direct export sales.

But gold ends up in a lot of manufactured goods, especially electronics, so there's a potential for a second-hand impact if demand for those products dries up.

If, as some have speculated, Trump's economic plans delay further rate cuts, and even cause some inflation in the US, that could support the thesis that the gold price will rise, since it's the type of thing investors like to hold when inflation rises, you can see the spot price starting to rise from 2022:

No definitive answer for you I'm afraid, but hopefully some useful sign posts!

Remember we said we'd bring you some more hot takes on the today's Wage Price Index from the ABS? Well, I've managed to cobble together a couple of excerpts from the economist notes hitting our inbox:

CBA economist Stephen Wu had this to say:

We think the takeaway from today’s wages data is that there may be more spare capacity in the labour market than the jobs‑related data suggests. The current 4.1% unemployment rate is at low levels (below the RBA’s estimate of the NAIRU) and the number of job vacancies remains elevated. Surveyed measures have also seen a recent uptick in the share of firms indicating that labour is a constraint on production. And the RBA Governor noted at her November press conference there are some signs the easing in the labour market might have ‘stabilised a bit’.

Stephen Wu says expects tomorrow's October labour force survey from ABS to show an increase in unemployment.

NAB Senior markets economist Taylor Nugent reckons wages growth is past its peak "reflecting the substantial rebalancing in the labour market over the past couple of years" but says "the RBA is still awaiting further evidence that will continue and will translate through into cooler inflation pressures."

The bottom line is, he says:

The labour market remains tight with the unemployment rate near 4.1% but has seen substantial rebalancing from the exceptional tightness in 2022. The RBA will be encouraged that the still tight labour market has not so far been an impediment to easing wage inflation. Note though that wages data is not particularly timely, with today’s data reflecting wage changes over the 3 months to August. Given sluggish productivity growth, the RBA will still need to see some further easing in the labour market and better realised inflation outcomes to be comfortable in its inflation trajectory.

All eyes will be on tomorrow's ABS unemployment figures out at 11.30am AEDT.

• ASX 200: -0.9% to 8,182 points
• Australian dollar: Flat at 65.38 US cents
• S&P 500: -0.3% to 5,983 points
• Nasdaq: -0.1% to 19,281 points
• FTSE: -1.2% to 8,025 points
• EuroStoxx: -2% to 502 points
• Spot gold: +0.4% $US2,607/ounce
• Brent crude: +0.4% $US71.42/barrel
• Iron ore: Flat at $US100.65/tonne
  
• Bitcoin: -0.9% to $US87,502.

Price current around 2.29pm AEDT

Jumping in again to share this update on Cbus from ABC senior business correspondent Peter Ryan:

I understand that after weeks of knocking back invitations, Cbus chief executive Kristian Fok has agreed to front the Senate Economics Committee scheduled to convene tomorrow.

This turnaround comes after the Australian Securities and Investments Commission (ASIC) said it was taking Cbus to court over its alleged mishandling of insurance claims to grieving families and people with disabilities.

Cbus has previously resisted calls to front the Senate inquiry suggesting it was “not prudent” given an ongoing review by the prudential regulator APRA.

However, I’m told Cbus has agreed to appear on the proviso that Mr Fok will not be expected to answer questions that may jeopardise the outcome of the APRA review.

The Committee, chaired by NSW Liberal Senator Andrew Bragg, has big questions for Cbus in addition to ASIC’s latest allegations of failed insurance claim handling procedures.

Senator Bragg will see the appearance of CEO Kristian Fok as a victory, even though he had urged Cbus chairman Wayne Swan to appear – describing the former Labor treasurer as “a person of interest”.

Have you seen a business using false or misleading advertising about the National Disability Insurance Scheme?

The ACCC says examples include:

• The use of the words ‘NDIS approved’, as the NDIS does not have the function of approving or endorsing particular goods or services.
• Advertising suggesting NDIS funds will cover “all inclusive” holidays, when general costs associated with holidays would not be covered by NDIS funding.
• Meal delivery services suggesting the cost of meals is covered by the NDIS, when the NDIS does not cover food expenses.
• Advertising that provides instructions on how to use NDIS funding codes to cover costs of recreational services that are not covered by the NDIS – for example, going to the movies or a theme park.
• Advertising that suggests a business is affiliated or endorsed by the NDIS, by using NDIS in its business name or in the description of its services, for example ‘NDIS therapies’.

The ACCC is calling for consumers to dob in those doing the wrong thing after it last month released new guidelines on what can and can't be claimed on the NDIS.

The regulator has confirmed it's already investigating multiple businesses for potentially breaking Australian consumer law.

“The ACCC is concerned that many businesses continue to advertise goods or services that appear on the list of ineligible supports in a way that suggests NDIS funding can be used to purchase them,” ACCC Deputy Chair Catriona Lowe says.

“We are also concerned that many NDIS providers are claiming that certain products or services are ‘NDIS approved’, ‘NDIS funded’ or otherwise NDIS endorsed when this is not the case.”

“The ACCC is actively investigating multiple NDIS providers for contraventions of the Australian Consumer Law and anticipates taking public enforcement action in the near future.”

Know of a business doing the wrong thing? You can make a report to the ACCC.

In company news, if you're wondering why James Hardie Industries is leading on the ASX 200 today, it's because of the company's latest financial results.

The building materials company is currently sitting at the top of the main index, up 7%.

Here's a write-up from the wires:

James Hardie Industries boosted its annual profit view and announced a $300 million share buyback plan today, after reporting better-than-expected second-quarter earnings on the back of strong performance in the Asia-Pacific region.

James Hardie posted a 12% fall in its second-quarter adjusted net income to $157 million due to lower sales in North American operations, the company's top profit generator.

The profit, however, beat a Visible Alpha consensus of $145.9 million.

The company said it now expects at least $635 million in adjusted net income for fiscal 2025, compared with $630 million to $700 million previously forecast.

The company's North American fibre cement division accounted for more than 70% of total sales in the 2024 financial year. However, net sales there were down from the year prior.

The corporate watchdog's Sarah Court has just held a press conference about ASIC's new case against Cbus.

It's worth noting ASIC isn't just alleging that Cbus failed to pay out one in two disability and death insurance claims to its members within a timely manner.

(Which Cbus has already all but apologised for.)

ASIC is also alleging Cbus failed to report the delays it was having in a timely manner, and that when it did, it provided "misleading" information about when Cbus became aware.

Sarah Court says all of this had a real world impact and compounded people's trauma.

"Delays in claims processing can cause real harm," she says.

"Families waiting on payment, whether grieving for a loved one or dealing with severe injury or illness, are reliant on these payments to meet critical expenses. 

"ASIC has brought this case to protect the rights of vulnerable Australians and their families in their most difficult times."

Read more about ASIC's case here.

We'll bring you hot takes on the latest WPI data as they arrive in our inbox.

EY Senior Economist Paula Gadsby notes the 0.8% quarterly rise in the September quarter included the 3.75 per cent rise in the minimum wage (which was the smallest rise in the minimum wage since 2021):

"... in annual terms, real wages growth has been positive for four consecutive quarters, at 0.7 per cent, as headline inflation eases. But when compared to underlying inflation, real wages growth is flat.

For the first time since the December quarter 2020, growth in public sector wages outpaced private sector wages, rising 3.7 per cent in annual terms, compared to 3.5 per cent in the private sector. 

Wages growth continues to ease, and the WPI is on track to meet the Reserve Bank’s forecast of 3.4 per cent by the end of the year.

This result will provide some comfort to the Reserve Bank as it attempts to get inflation back to the 2-3 per cent target band, without being overly restrictive with monetary policy. But if productivity growth remains sluggish, it will be difficult to maintain this level of wage increases without renewing inflationary pressures. The Reserve Bank’s outlook rests on productivity growth returning to its long-run average – and this is far from guaranteed."

The big question for those with a mortgage will be what does it mean for interest rates? According to Paula Gadsby:

"High underlying inflation, low productivity growth, elevated government spending and a still relatively tight labour market, are all factors that reinforce our view that the Reserve Bank will keep rates on hold until at least early next year."

The long winter for Aussie lithium producers has led to another mine being put into care and maintenance — this time it's Mineral Resources' Bald Hill mine in WA.

"The transition to care and maintenance will preserve cash and the value of Bald Hall's spodumene orebody for when conditions in the global lithium market improve," the company said this morning.

Around 300 workers will be "prioritised for redeployment" into other MinRes operations but "where redeployment opportunities cannot be found a redundancy process will be followed".

The wind-down will begin from this week, with a final shipment of lithium from the Goldfields mine expected to leave our shores in December.

It's expected it'll take around six weeks to get the mine going again when the lithium price improves.

The ASX 200 is down on Wednesday. Right now it's down 1.2% to 8,157.

This is how the sectors are faring on the main index today:

Here's a look at the best and worst-performing stocks just after midday:

Stay tuned for more updates.

• ASX 200: -1.2% to 8,158 points
• Australian dollar: -0.1% to 65.27 US cents
• S&P 500: -0.3% to 5,983 points
• Nasdaq: -0.1% to 19,281 points
• FTSE: -1.2% to 8,025 points
• EuroStoxx: -2% to 502 points
• Spot gold: +0.2% $US2,602/ounce
• Brent crude: Flat at to $US71.88/barrel
• Iron ore: Flat at $US100.65/tonne
  
• Bitcoin: +0.2% to $US88,499.

Price current around 12:15pm AEDT

The pace of wages growth has slowed, but it's continued to outpace inflation for the fourth quarter. 

That'll bring some relief to households struggling with the cost-of-living.

As mentioned in my earlier post, annual wages growth slowed to 3.5 per cent.

Quarterly wages growth was up 0.8%.

In comparison, inflation rose 0.2% in the September quarter and headline inflation was up 2.8% over the year.

Both private sector and public sector wages grew 0.8% in the September quarter (in seasonally adjusted terms).

The largest industry contributors to quarterly wages growth were Healthcare and social assistance (+1.7%), Retail trade (+2.1%), and Administrative and support services (+2.1%).

ABC business editor Michael Janda is filing on the latest figures here:

The latest ABS Wage Price Index data has just landed.

Key points are:

Wages growth in Australia has slowed to 3.5 per cent over the past year, according to September quarter data released by the Australian Bureau of Statistics.

That was down from 4.1 per cent wage growth over the year to June, with quarterly wages growth easing to 0.8 per cent in the September quarter.

The number was marginally below typical economist forecasts for wages growth.

We'll bring you more commentary and analysis shortly.