The ASX was riding slightly higher in trade today after rebounding from earlier losses.
The S&P/ASX 200 index is up by 12.9 points or 0.18% to 7118.3 led by consumer discretionary, staples, industrials and real estate in the green. Healthcare was the weakest sector.
In the news today
Australian software company's (other) founder ups Genex bid
Atlassian (NASDAQ:TEAM) co-founder Scott Farquhar’s consortium has upped its takeover bid of Genex Power to $346 million.
The bid by the consortium led by Farquhar and wife Kim Jackson sent the energy company’s shares soaring almost 7% to 24 cents by midday.
The Jackson-led Skip Essential Infrastructure Fund and US investment firm Stonepeak put in a new offer of 25c per share, which was enough for the board to open the company’s books for detailed due diligence.
Genex said in a note today, “After careful consideration of the revised indicative proposal (including consultation with Genex’s advisers), the board considers that it is in the interests of Genex shareholders as a whole to engage further with the consortium. Accordingly, the board has decided to provide the consortium with the opportunity to conduct confirmatory due diligence in order to assist the consortium to provide a binding proposal to the board. The provision of due diligence will be on a non-exclusive basis and subject to the terms of a confidentiality agreement between the consortium and Genex.
“If the consortium provides a binding proposal in respect of the proposed scheme at no less than A$0.250 in cash per Genex share to the board, subject to the entry into a scheme implementation agreement acceptable to the board and no superior proposal emerging, it is the board’s current intention to unanimously recommend that Genex shareholders vote in favour of the proposed scheme (in the absence of a superior proposal and subject to an independent expert concluding [and continuing to conclude] that the proposed scheme is in the best interests of Genex shareholders).”
Wage growth won’t add to rate hikes
Data released by the Australian Bureau of Statistics (ABS), and employer data from the Reserve Bank, show overall wage growth was the highest since 2014.
Despite annual wages growing a softer than expected 2.6%, the average private sector pay rise was the fastest in a decade at 3.8% in the June quarter.
The first number pushed real wages further backwards and when adjusted for strong inflation, they fell 3.5% in 2021-22.
“For all the rhetoric and anecdotes of stronger wages growth, the official WPI (Wage Price Index) has been stubbornly slow to lift,” the CBA’s economists wrote in a note last week.
“It is true that wages growth has accelerated. But the pace of change has been modest considering the tightness in the labour market.”
Private sector employees should count themselves lucky.
“A higher proportion of private sector jobs received a wage increase compared to recent June quarters,” the ABS said.
“The average size of wage rises in the private sector grew quickly over the last two quarters, and at 3.8% this quarter was the highest average increase recorded since June 2012.”
The majority of employers expect pay rises of more than 3% this year.
“The upshot is that while wages growth across the economy is moving higher and some people are receiving large pay rises, there have not been broad‑based wages pressures,” CBA head of economics Gareth Aird said.
“Indeed real wages growth (as measured by headline inflation deflated by the wage price index) is deeply negative.
“The RBA is not facing a wage price spiral like is being observed in some other jurisdictions. Put another way, the RBA does not have to run hard against wages growth by aggressively hiking the cash rate.”
The latest figures do not include the recent 5.2% increase to the minimum wage or the 4.6% rise for about 2.4 million award wage workers that recently came into effect.
Construction led the way in wage growth up 3.4%, manufacturing was 3.1% higher and real estate grew 3.1%.
The government sector, education and healthcare recorded the slowest growth at 2.3%.
“Expanding demand for skilled jobs over the last 12 months has continued to build wage pressure across a broader range of industries and jobs, reflected in the increasing size of pay rises,” the ABS’s Michelle Marquardt said.
The private sector saw average hourly wage rises of 3.8% between April and June, up from 2.7% during the same period last year – the highest rate of average wage movement for the sector since June 2012, the ABS said.
The number is based on just 14% of workers and will increase in the September quarter when about 40% of the population factor in July pay rises.
Senior economist at Capital Economics Marcel Thieliant believes wage growth will hit 3% in the September quarter, and 3.5% by mid-2023.
“The proportion of workers receiving a pay rise was unusually high for a June quarter as the number of employees switching jobs has continued to accelerate,” Thieliant said.
The five at five
Polymetals Resources progresses to early-stage mine acquisition discussions for Australian polymetallic asset
Polymetals Resources Ltd (ASX:POL) has recently conducted a high-level review of an Australian polymetallic production asset, currently on care and maintenance.
C29 Metals secures two of three remaining exploration grants for Olympic Dam project in South Australia
C29 Metals Ltd (ASX:C29) has been granted two of three remaining exploration licence applications in the highly prospective Olympic Dam iron oxide copper-gold (uranium) (IOCG) province of the Stuart Shelf in central South Australia.
Critical Resources continues to deliver high-grade lithium at Mavis Lake
“The company continues its drilling program, and is planning a phase three program and identifying future areas for potential permitting,” said Critical Resources Ltd (ASX:CRR) chairman Robert Martin.
Triangle Energy’s Cliff Head joint venture exports second oil load-out through Port of Geraldton
Triangle Energy (Global) Ltd and Pilot Energy (ASX:PGY) Ltd’s Cliff Head Joint Venture (CHJV) has shipped about 51,000 barrels of oil to a refinery in Thailand, where the oil will be sold.
Riversgold triples lithium targets at Tambourah in Western Australia with deep ground penetrating radar survey
“Through this survey, we have at least tripled the footprint of the interpreted lithium system at Tambourah. DGPR should significantly help decrease our drilling costs at Tambourah," Riversgold Ltd (ASX:RGL) CEO Julian Ford said.
On your six
How do you identify quality companies to invest in? Pitcher Partners has a three-pronged approach.
Bring it in: the sporting philosophy to help investors find opportunities
If you are committed to the investment game plan, don’t ride the highs and lows like a football team. Take a leaf out of the coach’s book and stick to the process.
The one for good luck
Emyria approved to start Phase 3 clinical trial of EMD-RX5
Emyria Ltd (ASX:EMD) managing director Dr Michael Winlo joins Elisha Newell from Proactive to talk about receiving approval from the Human Research Ethics Committee (HREC) to start a Phase 3 clinical trial of its ultra-pure cannabidiol (CBD) candidate, EMD-RX5.