While Australian securities rally, the US stock exchange is also rebounding from one of the worst days since 2020 despite a slump in big tech stock prices.
Tech giants Amazon and Apple were hit by supply costs and constraints that translated to lower-than-expected forecasts, sending share prices tumbling in trading after market close.
Netflix and Alphabet followed the trend down, while Microsoft, Tesla and Meta managed to rally.
Kogan, the online retailer, has also been caught out by changing market conditions, with gross sales falling 3.8% in the March quarter and gross profit dropping 11.2% in the same period.
Predictably, the stock fell another 10% after losing 64% of its value over the last 12 months.
The ASX has finished 0.91% up today, recovering for the second straight day after a slump over the last week.
All sectors were higher, with Information Technology leading the way after a hard year of losses, gaining 1.83%.
Australian wholesale energy prices soar 141% QoQ
In bad news for Australian consumers, wholesale energy prices have continued to rise on the back of supply constraints and geopolitical turbulence, increasing a whopping 141% quarter on quarter.
The Australian Energy Market Operator (AEMO) said on Friday that prices in the national electricity market averaged $87 per megawatt-hour in the first three months of this year, while the Quarterly Energy Dynamics Report found that prices have been rising in every region.
Black coal electricity generation was at its lowest quarterly level since 2002 and although wind and solar farm output has hit a new quarterly record, they’re not yet enough to keep up with increasing demand.
The AEMO sees no relief in sight, forecasting that energy companies will increase their power pricing by 8% after the election, averaging out to about $100 a bill.
The Labor party is pointing the finger at the Coalition Government, stating the energy price increases are a result of the "Coalition's war against renewables".
"Electricity prices are higher because cheaper renewables are not moving into the system as quickly as they should be doing so," Australian Labor Party Nation President Wayne Swan told Today.
"The Coalition has held that up. It's another area where they've been missing in action and are living with the consequences of their inaction."
Defence Minister Peter Dutton was having none of it, echoing the party line that cost of living would be worse under a Labor government.
"If you're worrying about electricity prices and petrol prices they will always be higher under Labor," Dutton said.
Violette Mouchaileh, AEMO's executive general manager of reform delivery, stated that rising prices were hitting north-eastern states the hardest, exacerbated by coal-fired outages and grid constraints.
Grid limitations in particular hampered NSW’s ability to import power from Victoria, "despite an average energy price difference of $48/MWh".
"Wholesale prices in Queensland and NSW were again significantly higher than in southern states," Mouchaileh said.
Exposure to international fuel uncertainty is making Australians even more vulnerable, says Dale Koenders, the head of energy research at investment bank Barrenjoey.
"The outlook is the average household electricity bill could be increasing in the order of 20% this year and 20% again next year unless we can see a change in the cost of electricity," Koenders said.
"There is a real shortage of electrons and generation in the market and generators are doing everything they can to make sure the lights don't go out.
"But that just costs more."
Koenders pointed to greater uptake of renewable energy backed by structural grid infrastructure like batteries and pumped hydro storage facilities as a possible solution, but cautioned the transition would not be easy.
"As we go through this energy transition, and prioritise green electricity, what we are facing is greater volatility, greater uncertainty, and higher prices," he said.
"And until we get to that end point where there is sufficient hydro build-out and battery storage as per government targets, we are going to continue to face increased volatility in the electricity market."
Leaked documents reveal Chinese aviation company’s plans to develop Solomon Islands as a ‘regional hub’
A memorandum of understanding (MoU) obtained by the ABC has outlined a proposed exchange between the Solomon Islands and one of China’s largest aerospace companies – Aviation Industry Corporation of China (AVIC) – detailing plans to transform the Pacific nation into an "aeronautical hub".
Signed in November 2019 by Solomon Islands Minister for Communication and Aviation Peter Shanel Agovaka at Yanliang, the MoU outlines plans to upgrade three dozen airstrips in the Solomon Islands in return for the purchase of six aircraft from AVIC Commercial Aircraft, a subsidiary of the larger defence and aerospace giant.
No progress appears to have been made on the terms of the MoU, however, with the CEO of Solomon Airlines, Brett Gebers, stating he was unaware of the agreement when contacted by the ABC.
"I discussed this MoU with the board and, as it has not yet been presented to the board, the chairman said that he will contact the MCA [Ministry of Communication and Aviation] to find out more about it," Gebers told the ABC.
"I was half-heartedly invited to accompany a group of MPs to China around this time in 2019 but nothing ever came of it. There was mention of looking at aeroplanes."
There is some speculation the plans may have been delayed by the emergence of the COVID-19 pandemic, with Dr Graeme Smith from the Australian National University telling the ABC that there was "great deal of urgency in the [aviation] agreement … far more urgency than you find in many MoUs between China and the Pacific".
"I suspect mainly what stopped it from happening is COVID-19, because it was signed in November 2019 [just before the pandemic] and all the timelines … would have gone quickly out of the window," Dr Smith said.
"The requirements for this agreement to kick in would have required both a visit to China by the Solomon Islands side and a visit to Solomon Islands from the Chinese side, both of which would have been very difficult to manage after February 2020."
Dr Smith also expressed concerns about AVIC’s ties to China’s military arm but cautioned against unfounded speculation.
“Is this company going to build a base in Solomon Islands? Probably not, it's not really what they do. But certainly, they have extremely strong ties to the Chinese military." he said.
On the small cap front
Evolution Energy Ltd was 7.29% higher
American Rare Earths Ltd was 5.84% higher
Tietto Minerals Ltd was 5.05% higher
Orion Minerals Ltd was 4.17% higher
Dundas Minerals Ltd was 3.13% higher
South Harz Potash Ltd was 2.94% higher