The markets have started to rally again this week after over a month of sharp falls and shaky recoveries, with the All Ordinaries gaining 1.70% over the period, the S&P200 1.75%, and the Small Ordinaries trailing behind with a 0.99% gain.
Energy and Materials maintained their growth over the week, gaining 3.42% and 3.47% respectively as utilities took a beating, falling -5.50%.
The other sectors mostly enjoyed small gains throughout the week, with consumer discretionary (-0.05%), health care (-0.07%), communication services (-0.31%) and financials (-1.43%) dipping mildly.
The Dow broke through to a new high for the week today, gaining 1.34% since Tuesday May 31, but still sitting well below its 52-week average range at just 22,248.28 points.
The Nasdaq enjoyed similar gains – it is sitting at a weekly high of 12,316.90 points, having gained 2.2% since Tuesday.
According to Paul Robinson, strategist for DailyFX, recovery bounces tend to last between four and eight weeks in bearish markets, indicating there may be a further upswing before the downturn returns.
“Right now, we are at about two weeks, so there appears to be a little time on the market’s side,” Robinson wrote in an article yesterday.
“It bears keeping a close eye on the Nasdaq 100 while all this plays out. It has been the leader on the way up and since the beginning of the year the leader on the way down. It’s looking like the NDX is going to continue that.”
AGL demerger defeat signals new age of shareholder activism
The failed demerger of AGL’s coal assets into a separate entity may herald a new era for investing, where activist individuals and organisations vote in shareholder meetings rather than protest on the street.
Against the backdrop of an election won and lost on climate change action, it’s somewhat unsurprising that tech billionaire Mike Cannon-Brookes and healthcare-based superannuation company HESTA refused to support the demerger, with the superannuation company citing its duty to protect its shareholders interests in supporting decarbonisation and energy transition as the core impetus for its decision.
“The events at AGL represent a watershed in active ownership in this country,” HESTA chief executive Debby Blakey said.
“Shareholders are pushing for greater action on climate change and a more rapid transition that aims to enhance the company’s ability to create long-term, sustainable value.”
Despite losing most of its board of directors post proposal defeat, AGL’s share price hasn’t taken the expected beating.
While shares did dip 1.7% to $8.60 on Monday, the price is back to pre-demerger proposal levels today, sitting at $8.74 with just a -0.11% loss over the last five days, indicating shareholders aren’t following directors in jumping ship en masse.
“It is a real lesson that corporate Australia needs to learn. Retail shareholder activism and true democracy [is] becoming a part of corporate Australia in a way it hasn’t before,” senior campaigner for Greenpeace Australia Pacific Glenn Walker said.
“Everyday shareholders [are beginning] to harness their actual power when voting. This AGL story is the beginning of the end for greenwashing.
“AGL is the first company to publicly realise in this way that they don’t have the sway they thought they had [and] I believe we can unlock that and force more boards to be more responsible actors.”
WHO campaigns for greater unity in the face of emerging outbreaks
The World Health Organization’s (WHO) expert Dr. Rosamund Lewis has reassured the international community that the organisation does not currently expect monkeypox to develop into a pandemic but has expressed concern at our lack of knowledge of the poxvirus’ transmission vectors.
"It is not yet known whether this virus is exploiting a new mode of transmission, but what is clear is that it continues to exploit its well-known mode of transmission, which is close, physical contact," Lewis said.
The WHO has called for greater global unity in tackling unusual emerging pathogens, seeking to avoid the mistakes made during the COVID-19 pandemic.
"We must have one connected global response to monkeypox to avoid it becoming endemic in more countries," WHO Africa director Dr Matshidiso Moeti said in an online briefing.
"It is very important that … we make sure that we share those tools, we build capacities all over the world to respond to these outbreaks.
"What is extremely important now is to avert any potential for a repeat of the inequitable access to COVID-19 vaccines experienced by African countries early in the pandemic.”
Monkeypox comes from the same family of viruses as smallpox – causing fever, aches, and a distinctive lumpy rash – leading some experts to question whether its sudden spread is due to a dramatic fall in smallpox vaccinations after the disease was declared eradicated.
Three cases of monkeypox have been detected so far in Australia, with global levels estimated at about 550 cases across 30 countries.
Small cap wins for the week
Amplia Therapeutics Ltd (ASX:ATX) gained 18.18% in the last five days of trading, buoyed by positive results from preclinical data demonstrating the efficacy of its investigational focal adhesion kinase inhibitor, AMP945, in a mouse model of idiopathic pulmonary fibrosis.
Current treatments for idiopathic pulmonary fibrosis come with the threat of significant side effects, limiting their utility as treatments.
The other small cap winner for this week was Meteoric Resources NL (ASX:MEI), which enjoyed a 25.92% jump in its share price over the period.
The company executed a $30 million agreement to sell the Juruena Gold Project to Keystone Resources today, allowing Meteoric to concentrate its resources on the Palm Springs Gold Project in WA.