ASX snaps two-day losing streak after technology stocks rally, unemployment rate falls to 4 per cent — as it happened (2024)

• ASX 200: +0.4% to 7,749 points (final values below)
• Australian dollar: -0.3% at 66.41 US cents
• S&P 500: +0.9% to 5,421 points
• Nasdaq: +1.5% to 17,608 points
• FTSE: +0.8% to 8,215 points
• EuroStoxx: +1.1% to 522 points
• Spot gold: -0.4% to $US2,312/ounce
• Brent crude: -0.3% to $US82.34/barrel
• Iron ore: +0.8% to $US104.55/tonne
• Bitcoin:-0.9% to $US67,456

Price current around 4:15pm AEST

Updates on the major ASX indices:

Thanks for your company throughout the day.

We'll be back to do it all again tomorrow for the final time this week — and it's going to be quite the day, with the Bank of Japan meeting.

Until then, you can catch up on the day's developments below — or for more news, you can tune into tonight's episode ofThe Business on ABC News at 8:45pm, after the late news on ABC TV, and anytime on ABC iview.

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After two days of back-to-back losses, the ASX 200 has closed 0.4% higher to 7,749 points on Thursday afternoon.

A rally by technology and healthcare stocks led the charge on the sectors front, gaining 1.6% each.

Other sectors that recorded gains were: real estate (+1.2%), consumer cyclicals (+0.9%), industrials (+0.8%) and utilities (+0.6%).

Three sectors ended in the red for the day: energy (-0.6%), education (-0.6%) and basic materials (-0.4%).

As for the top performing stocks for the day:

• Nanosonics +4.6%
• Polynovo +4%
• Life360 3.7%
• NEXTDC +3.6%
• A2 Milk Company +3.4%

And the bottom performing stocks:

• ASX Ltd -8%
• Liontown Resources -4.8%
• Lynas Rare Earths -4.4%
• Arcadium Lithium -4.1%
• Sigma Healthcare -3.7%

The Pharmacy Guild of Australia says it holds the same concerns as the competition watchdog when it comes to the proposed merger deal between Chemist Warehouse and Sigma Healthcare.

"As a major structural change to the community pharmacy sector, the Guild remains concerned that the reverse takeover of Sigma by Chemist Warehouse will increase prices, reduce service quality and degrade the world-class health care available through Australia's community pharmacy network," a spokesperson said in a statement.

"The Guild is similarly concerned by the potential for discriminatory and/or self-preferencing conduct by Chemist Warehouse, the foreclosing of pharmacies currently supplied by Sigma, and the use of Sigma's data assets to undermine the competitive position of non-Chemist Warehouse pharmacies.

"The ACCC's statement that 'Chemist Warehouse appears to exert significant control or influence over its banner stores, including through high levels of executive ownership of Chemist Warehouse stores' warrants urgent attention from State and Territory regulators."

Housing affordability is a major issue here in Australia, but new research from US academics shows that our capital cities are among the least affordable places in the world to buy a home.

The study compared housing markets in 94 cities across eight countries: Australia, Canada, Hong Kong, Ireland, New Zealand, Singapore, the United Kingdom and the US.

To compare the different markets, researchers used a ratio of median incomes to median house prices, also known as the "median multiple".

Of the Australian capitals, Sydney, Melbourne, Adelaide, Brisbane and Perth were all in the least affordable 25% of cities out of the 94 places included in the study.

As for the cities that are the most affordable in the world?

You'll have to read the full story from my colleague Clint Jasper below to find out.

Although the unemployment rate fell to 4% in May, analysts say it will likely keep rising in the months ahead — and that will keep the RBA in a holding pattern when it comes to interest rates.

"At 4%, the unemployment rate is spot on the RBA's forecast for the second quarter," Tony Sycamore from IG said.

"Today's numbers will not impact the outcome of next week's RBA meeting, where rates will likely be kept on hold at 4.35% for a fifth-straight meeting."

Even though May's employment growth was driven by a rise in full-time employment, economists say the numbers seem to be consistent with the RBA's expected conditions in the jobs market.

"There is clear evidence that monetary policy is having the intended impact on the Australian economy, even if that's been slower than the RBA might prefer," said Callam Pickering from global job site Indeed.

"We view monetary policy as being tentatively poised. Another unwelcome surprise on the inflation front could certainly force the RBA to take action.

"Nevertheless, we believe that the economy will be sufficiently weak this year to drag down service sector inflation, with the recent inflation figures being more an aberration than a change in trend."

Earlier today, the ACCC said it was particularly concerned about competition in the country's pharmacy sector, should it give the green light to Chemist Warehouse and Sigma Healthcare's proposed merger.

To be clear, the ACCC hasn't said "no deal" to the proposal, but it's wanting more detail about it before it makes up its mind — which is due to happen on September 5.

But if you haven't been following the story, or have seen the headlines and want to know what it means for Chemist Warehouse, you're in the right place.

Here's everything you need to know about the proposed merger between the two businesses that would create the biggest pharmacy company in Australia worth almost $9 billion👇

(And if you still have questions, feel free to send them my way by using the blue comment button at the top of the blog, and I'll do my best to answer them throughout the afternoon!)

The positive momentum on the ASX 200 is pushing the local bourse higher at lunch, gaining 0.5% to 7,754points as of 12:25pm AEST.

(You can get the latest figures at the top of the blog.)

Tech and real estate stocks are driving the local market when it comes to the sectors — they're up 1.7% and 1.5% respectively.

Other sectors with substantial gains include consumer cyclicals (+1.3%), health care (1%), industrials (+0.9%) and utilities (+0.8%).

Only two sectors are in the red: energy (-0.4%) and basic materials (-0.3%).

As for the top movers so far:

• Nanosonics +4%
• Audinate Group +3.9%
• NEXTDC +3.7%
• Polynovo +3.7%
• Life360 +3.5%

While the bottom movers include:

• ASX Ltd -8.8%
• Sigma Healthcare -6.4%
• Liontown Resources -3.3%
• Arcadium Lithium -3.1%
• Lynas Rare Earths -2.5%

Bjorn Jarvis, the head of labour statistics for the ABS, says there are a couple of reasons behind the unemployment rate dipping slightly in May to 4%.

"In April, we saw more unemployed people than usual waiting to start work. Some of the fall in unemployment and rise in employment in May reflects these people starting or returning to their jobs," he said.

"While the total number of unemployed people fell by 9,000 in May, this followed a 33,000 increase in April.

"Unemployment was around 24,000 people more than in March, an average increase of around 12,000 people each month.

"There are now almost 600,000 unemployed people, however, that is still nearly 110,000 fewer people than in March 2020, just before the pandemic."

Mr Jarvis said both the employment-to-population ratio and the participation rate are still far higher than they were prior to the pandemic.

"Together with elevated levels of job vacancies, this suggests the labour market remains relatively tight, though less than in late 2022 and early 2023," he said.

Australia's unemployment rate fell to 4.0% in May, down 0.1 percentage points from April.

Employment rose by 40,000 people in May, and the number of officially unemployed people declined by 9,000, which helped the unemployment rate to decline slightly.

The Commonwealth Bank says despite a lift in its monthly Household Spending Index, growth in consumer spending has almost flatlined since January and stage 3 tax cuts are unlikely to meaningfully shift spending.

The monthly CommBank Household Spending Insights Index (HSI) rose 1.1 per cent in May to 150.2 following a 1.0 per cent drop in April, continuing the month-to-month spending volatility seen throughout 2024.

While household spending rose in May, spending remains soft since January with monthly gains averaging just 0.1 per cent, pointing to a weak consumer environment. This compares to a monthly growth rate of 0.8 per cent in the first four months of 2023.

Nine of the 12 HSI spending categories rose in May, led by increases in spending on Household Goods (+2.3 per cent), Food and Beverage Goods (+1.8 per cent), Hospitality (+1.7 per cent) and Transport (+1.3 per cent), all of which were weak in April.

In the year to May 2024, the pace of increase in the HSI Index lifted to 4.3 per cent, driven by Insurance (+8.6 per cent), Utilities (+7.1 per cent), Transport (+6.1 per cent) and Education (+6.0 per cent) — all essential spending categories that have recorded price increases over the year.

S&P Global warns university rankings and research funding would be harmed by planned restrictions on international student migration.

The university sector has warned the planned student caps could cost 4,500 jobs nationwide.

The government has also announced a crackdown on "visa hopping" students, cutting off some visa avenues from July.

Read more from political reporter Jake Evans.

The Australian Competition and Consumer Commission (ACCC) says the proposed merger between Chemist Warehouse and Sigma Healthcare raises "competition concerns" and would be a "major structural change" for the country's pharmacy sector.

The competition watchdog has released its preliminary statement of issues outlining a number of competition concerns should the merger between the two companies proceed.

"This is a major structural change for the pharmacy sector, involving the largest pharmacy chain by revenue merging with a key wholesaler to thousands of independent pharmacies that, in turn, compete against Chemist Warehouse," ACCC Commissioner Stephen Ridgeway said in a statement.

The ACCC said the deal would create a "new business model for the pharmacy sector" that "could raise barriers to rivals expanding or entering, which may lessen competition".

Read more here frombusiness reporter Kate Ainsworth.

The Australian sharemarket has opened higher, tacking gains on Wall Street.

The ASX 200 was up 58 points or 0.8 per cent to 7,773, by 10:15am AEST.

All sectors were higher except for education sector.

Most of the gains are coming from the tech (+1.8pc) and real estate (+1.8pc) sectors.

Here are the top and bottom movers at open.

A timely report from recruitment firm Kelly has been released today ...

If you're feeling fed up with a lack of autonomy and flexibility at your workplace, a new survey by Kelly shows you're not alone, with nearly half of employees surveyed saying their mandated work on-site days are"seemingly in defiance of employees' wishes".

And while 73 per cent of respondents expect AI to impact their roles, only about a third of them feel positive about the looming changes ... unlike executives surveyed, 64 per cent of whom had "high ambitions" for AI automation in their businesses.

But wait, there's more! The survey revealed that just 34 per cent of executives think more diversity in the workplace "supports" business performance, a number that falls to 29 per cent when you ask C-suite executives.

Executives' own assessment is damning: 53 per cent — unchanged from two years ago — admit that their organization's leaders and senior managers are failing to create an inclusive culture. Half say that few of their organization's senior leaders are from underrepresented groups. Nearly half (49 per cent) also say that their DEI strategy only pays lip service to supporting talent from underrepresented groups.

Some metric on these results — the survey includes 1,500 executives, and 4,000 workers from 13 countries and eight industries.

The full report is out to day for those keen to read on.

Qantas has announced it will purchase the remaining 49 per cent of Byron Bay-born online travel business TripADeal, accelerating Qantas Loyalty's exposure to the growing $13 billion online holiday packages market.

The acquisition will enable the group to deepen synergies by combining Qantas and Jetstar's extensive network with the growing curated tour market. It will also create a more tailored and integrated experience for Qantas Frequent Flyers.

Qantas acquired a majority stake in TripADeal in 2022, enabling its Frequent Flyers to earn and use their Qantas Points on African safaris, Fiji beach holidays, European getaways, adventures to India, and other ready-made holiday packages.

A scathing Senate report into the big four consultancy giants has called for greater scrutiny and regulation of the firms to ensure taxpayers are getting value from the billions of dollars being spent by governments.

The inquiry has made 12 recommendations, including calling on the firm to name and shame all the partners and staff involved in the saga.

Other sweeping changes recommended include slapping restrictions on the way accounting firms operate.

Their partnership structure could be revamped so that they would be subject to greater oversight and be required to pay corporate tax.

These firms would also face tougher hurdles when applying for lucrative government contracts.

But this isn't the end of probes into the industry, with a criminal investigation into a former PwC partner underway and several other inquiries that could make further recommendations about the governance and structure of big four firms, including a potential split between auditing and consulting functions.

Watch the story bybusiness reporter Nassim Khadem.

The Federal Reserve held interest rates steady on Wednesday and pushed out the start of rate cuts to perhaps as late as December, with officials projecting only a single quarter-percentage-point reduction for the year amid rising estimates for what it will take to keep inflation in check.

In a set of projections that likely removes the prospect of a reduction in borrowing costs before the November 5 US presidential election, Fed officials repositioned from expecting three quarter-percentage-point reductions in March to just the one despite an acknowledgement in the US central bank's new policy statement of "modest further progress" towards its 2% inflation target, an upgrade from its May 1 statement.

Fed Chair Jerome Powell, speaking at a press conference following the end of the two-day policy meeting, said that combination reflected a "conservative" outlook for inflation among policymakers. Even as "more recent monthly readings have eased somewhat," that is not yet enough to instill "greater confidence" in inflation returning sustainably toward 2%.

"It's only one reading," Powell said of a Labor Department report earlier on Wednesday showing the consumer price index eased last month more than expected.

"When we are (more confident), then we can look at loosening policy," Powell said.

Theshift among policymakersalso coincided with an increase to 2.8% in the estimated long-run, or "neutral," rate of interest from 2.6%, which indicates policymakers have concluded the economy needs more restraint to finish the battle against rising prices.

Recent progress has been slow, and Fed officials now project a slightly higher end-of-year inflation rate of 2.6% versus the 2.4% anticipated as of March.

While rate cuts are now seen getting a likely later start and proceeding at a slower pace this year than investors have anticipated, the Fed's policy rate is seen falling fast next year, with reductions of a full percentage point in both 2025 and 2026.

The Fed's statement and new Summary of Economic Projections show a central bank wrestling over how to respond to data that many read as pointing to slower inflation — consumer prices did not rise at all in May on a month-over-month basis, according to data released on Wednesday — but also to steady growth and job creation.

The S&P 500 and Nasdaq posted record closing highs for a third straight day on Wednesday afterinflation data came in softer than expected buttheindexes ended off the day's highs as the Federal Reserve projected only one interest rate cut this year.

The Fed's March projections included three quarter-percentage-point reductions. The US central bank, in a statement at the end of its June 11-12 meeting, also said it left its policy rate unchanged, as expected.

Stocks were choppy following the newsand press conference with Fed Chair Jerome Powell, with the S&P 500 and Nasdaq paring gains late and the Dow finishing near flat.

Stocks openedhigherafter the Labor Department reported that theUS Consumer PriceIndex was unexpectedly unchanged in Maydue to cheaper gasoline.

"The CPI number was certainly cooler than estimates and drove optimism to start the day but that was only half of today's menu," said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles.

James said he would have expected the market to end weaker after the Fed's update, noting that "the commentary was hawkish and rate cut (expectations) were trimmed from three to one".

Just after the CPI report, traders boosted bets for a Fed rate cut by September and another by December.

Apple's shares climbed 2.9%, extending Tuesday's strong gains, and the company briefly once again became the world's most valuable, dethroning Microsoft from the top spot.

• ASX 200 futures: +0.7% to 7,782 points
• Australian dollar: Flat at 66.64 US cents
• S&P 500: +0.9% to 5,421 points
• Nasdaq: +1.5% to 17,608 points
• FTSE: +0.8% to 8,215 points
• EuroStoxx: +1.1% to 522 points
• Spot gold: +0.3% to $US2,323/ounce
• Brent crude: +0.7% to $US82.46/barrel
• Iron ore: +0.8% to $US104.55/tonne
• Bitcoin: +0.7% to $US68,555

Price current around 07:30am AEDT

Live updates on the major ASX indices: