The ASX 200 posted its best weekly gain since December after Wall Street ended higher, with the S&P 500 hitting a record closing high.
The Australian dollar rallied against the greenback, hitting a 5-week high above 63 US cents after US President Donald Trump told Fox News he could make a deal with China.
Here's how the trading day unfolded, plus insights from our specialist business reporters.
Disclaimer: this blog is not intended as investment advice.
Key Events
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ASX closes higher, for best weekly gain this year
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Premier finishes the week where it started after Myer deal
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Aussie dollar, Kiwi enjoy Trump boost
Market snapshot
- ASX 200: +0.4% to 8,408 points (final values below)
- Australian dollar: +0.6% to 63.23 US cents
- S&P 500: +0.5% to 6,118 points
- Nasdaq: +0.2% to 20,053 points
- FTSE: +0.2% to 8,565 points
- EuroStoxx: +0.4% to 530 points
- Spot gold: +0.7% to $US2,774/ounce
- Brent crude: flat at $US78.26/barrel
- Iron ore: -0.3% to $US103.90 a tonne
- Bitcoin: +2.1% to $US105,272
Price current around 5pm AEDT
Live updates on the major ASX indices:
Goodbye for now
That's all for our business bloggers today — thanks for joining us this week, it's certainly been a big one.
The ASX is closed on Monday for the public holiday, so Stephen Letts will be back with you first thing on Tuesday with a round-up of the overseas market action.
And on Wednesday, we'll get the latest inflation read, with the fourth-quarter Consumer Price Index to be released ahead of the first Reserve Bank interest rates decision of the year in mid-February.
In the meantime, you can read stories from our reporters here and catch David Chau's finance report tonight on the 7pm News or anytime on iView.
And The Business will be back on Monday, hosted by Kirsten Aiken.
It will air Monday to Thursday on ABC News Channel at 8.45pm AEDT, after the Late News on ABC TV and anytime of the day or night on ABC iView.
In the meantime, happy weekend to those who celebrate!
Top and bottom performing stocks
Here's your round up of the biggest stock moves of the session on the ASX 200:
Best percentage gains
- Premier Investments (+6.6%)
- Monadelphous (+5.8%)
- AMP (+5%)
- Tabcorp (+3.9%)
- Centuria Capital (+3.4%)
Worst percentage falls
- Coronado Global (-6.3%)
- Regis Resources (-6.2%)
- Westgold Resources (-4.7%)
- Vault Minerals (-3.9%)
- Steadfast Group (-3.1%)
ASX closes higher, for best weekly gain this year
The Australian share market has closed higher for the week, with the All Ords and the ASX 200 each adding 0.4 per cent.
The ASX 200 rose 1.2 per cent over the past five days, its best weekly performance in a month.
Friday's gains came despite the energy sector being weighed down by an overnight fall in oil prices, while technology stocks also slipped.
ASX 200 sectors (LSEG Refinitiv)
Bank of Japan confident about outlook as rates hiked
Here's some more detail from Reuters, about the Bank of Japan's interest rate hike:
The Bank of Japan raised interest rates on Friday to their highest since the 2008 global financial crisis, underscoring its confidence that rising wages will keep inflation stable around its 2% target.
The decision marks its first rate hike since July last year and comes days after the inauguration of US President Donald Trump, who is likely to keep global policymakers vigilant ahead of potential repercussions from threatened higher tariffs.
At its two-day meeting concluding on Friday, the BOJ raised its short-term policy rate from 0.25% to 0.5% — a level Japan has not seen in 17 years. It was made in a 8-1 vote with board member Toyoaki Nakamura dissenting.
The widely expected move underscores the central bank's resolve to steadily push up interest rates to around 1% — a level analysts see as neither cooling nor overheating Japan's economy.
"The likelihood of achieving the BOJ's outlook has been rising," with many firms saying they will continue to raise wages steadily in this year's annual wage negotiations, the central bank said in a statement announcing the decision.
"Underlying inflation is heightening towards the BOJ's 2% target," the central bank said, adding that financial markets remain stable as a whole.
The BOJ made no change to its guidance on future policy, saying that it will continue to raise interest rates if its economic and price forecasts are realized. But it removed a phrase stressing the need to scrutinise risks surrounding overseas economies and markets.
"Their logic remains the same. They are still far away from neutral, so it's natural to make an adjustment," said Naka Matsuzawa, chief macro strategist at Nomura Securities in Tokyo.
"Unless the BOJ either changes the logic of rate hikes, or even raises the neutral point, which they have been mulling – about 1% – there's not going to much room for the market to price in further hikes in the future."
Tokyo's Nikkei initially held on to its gains after the move but has since fallen back to be fairly flat.
What Wall Street futures are saying right now
All the major index futures on Wall Street are currently down a smidge as the US heads into Friday trading (their time).
That is after the S&P hit a record closing high yesterday as Donald Trump rocks markets in his first week back as US president.
Wesfarmers is another top performer today
Another top performer on the ASX today is Wesfarmers, which owns Bunnings and Officeworks.
It has gained 3.3% apparently after Goldman Sachs upgraded its stock to "buy".
Premier finishes the week where it started after Myer deal
Premier Investments is currently the top gaining stock on the ASX after its sale of 700+ fashion stores to Myer was approved by both companies' shareholders yesterday.
Premier is currently up 6.4%.
That is after the company's stock actually dropped yesterday as its shareholders were approving the deal.
After all is said and done, Premier is basically finishing the week back where it started at $28.62 a share.
I spoke to Premier's Solomon Lew yesterday about his looming return to the board of Myer as part of that big deal.
He also detailed to me the tough economic conditions, which saw Premier put out a "blip" (his words, not mine) in apparel sales figures last year and other rivals like Mosaic collapse.
So how is Myer faring after the deal?
It is up 3.8% to exactly $1 a share. Which, as far as beleagured Myer shareholders goes, isn't too bad.
That is after Myer's stock rose on the deal yesterday.
Wages growth looks set to slow further, opening door to interest rate cuts
An interesting note out from Abhijit Surya at Capital Economics.
He's taken a look at the detailed jobs numbers released by the ABS this week and found signs of a weaker labour market than the headline unemployment figure suggests.
"We learnt that the share of employees who switched jobs over the past three months fell to a record low in Q4 (once we exclude the pandemic from the picture)," he observes.
"Generally speaking, job mobility tends to be a good guide to wage growth, since those who switch jobs tend to get larger pay hikes than those who don't."
He says there are, however, other signs that jobs growth has recently picked up again.
"In order to parse the signal from the noise, we've constructed a composite measure of labour market tightness, which incorporates data on job mobility, labour underutilisation as well as households' inflation expectations," he explains.
"Our index suggests that wage growth will indeed slow further over the coming quarters and settle at slightly below 3% by year-end.
"If that pans out, the RBA may soon become concerned about inflation undershooting the mid-point of its 2-3% target."
But will it be concerned about this when it next meets to set interest rates on February 17-18? That's the question currently on the mind of millions of mortgage borrowers.
CommSec's reporting season calendar is live
We enjoy this handy live list in the business team.
It sets down the date that every major company is due to report results to the ASX starting from January 30.
Is there any company you'd especially love us to focus on this company reporting season?
Are you a shareholder who would like to speak to us for a story about how you feel your investment is going?
Hit me up on [email protected]
Why New Zealand could get another rate cut in February
Emilia here with you for the next hour or so!
Over the ditch, New Zealand has been getting rate cuts from its central bank since August.
Of course, the celebrations have been muted. The reason the rates are going down is because NZ is in a recession.
Westpac has just added to speculation that Kiwis will get another rate cut in February, saying there's a high chance.
Some analysis that just dropped:
The latest updates on the New Zealand economy were a green light for a further rate cut from the RBNZ in February, with inflation pressures well contained. We’re forecasting another 50bp cut at the RBNZ’s February meeting. That will support a recovery in economic activity over the year ahead, though for now conditions remain mixed.
You can read more about New Zealand's economic woes in this piece from last month by our business editor, Michael Janda.
Aussie dollar, Kiwi enjoy Trump boost
It's not just the Australian dollar that's received a boost from Donald Trump's less aggressive stance on China this afternoon.
The New Zealand dollar has also rallied.
President Trump said his recent conversation with Chinese President Xi Jinping was friendly, while also adding he thought he could reach a trade deal with China.
"It went fine. It was a good, friendly conversation," Trump said in an interview with Fox News aired on Thursday evening, US time.
"I can do that," Trump said when asked if he could make a deal with China over fair trade practices.
If the less hostile stance persists, it would be a good thing for both the Aussie and the Kiwi.
"It's still early days, although it looks like he prefers to negotiate with China first and perhaps come to a deal, rather than to use tariffs," Sim Moh Siong, a currency strategist at Bank of Singapore.
"If he goes down the route of holding back on tariffs but instead coming to a deal with China, then you could see more relief coming through in terms of the Asian currencies as well as the Aussie and the Kiwi."
With Reuters
Bank of Japan increases key interest rate to 17-year high
In news out of Japan a short time ago, the Bank of Japan has raised interest rates.
It was a widely anticipated rate hike, which saw the central bank's board raise its short term interest rate target by 25 basis points to 0.5%.
Eight board members were in favour of the move, while one dissented.
BOJ Governor Kazuo Ueda will speak in the next hour.
The Nikkei 225 index remained higher following the decision while the Yen rose against the US dollar.
Market snapshot
- ASX 200: +0.4% to 8,408 points (live values below)
- Australian dollar: +0.3% to 63.06 US cents
- S&P 500: +0.5% to 6,118 points
- Nasdaq: +0.2% to 20,053 points
- FTSE: +0.2% to 8,565 points
- EuroStoxx: +0.4% to 530 points
- Spot gold: +0.7% to $US2,771/ounce
- Brent crude: -0.1% to $US78.21/barrel
- Iron ore: -0.3% to $US103.90 a tonne
- Bitcoin: -0.3% to $US102,872
Price current around 2:25pm AEDT
Live updates on the major ASX indices:
Aussie dollar rallies to five-week high
Over the last hour we've seen the Aussie dollar leap above 63 US cents.
That puts the currency at a five-week high against the greenback.
Australian dollar (LSEG Refinitiv)
According to Reuters, the catalyst was comments made by Donald Trump on Fox News, which also boosted Chinese stocks:
…Trump said his recent conversation with President Xi Jinping was friendly, adding he thought he could reach a trade deal with China.
"I can do that," Trump said in an interview with Fox News, when asked if he could make a deal with China over fair trade practices.
"But we have one very big power over China, and that's tariffs, and they don't want them, and I'd rather not have to use it, but it's a tremendous power over China."
Watch: Donald Trump addresses World Economic Forum
In his first week in office (for a second time), Donald Trump has addressed the World Economic Forum.
The US president appeared at the Davos gathering of economic and political leaders via video, and demanded lower interest rates and oil prices.
He also warned of tariffs on products made anywhere in the world but America.
Here's a report from US correspondent Barbara Miller:
Sotheby's records another year of declining art sales
Emilia here with you for a look into the opaque world of art sales.
The global auction house Sotheby's has just put out its annual results for 2024 and they show it made less than the year previously.
Its consolidated sales were $US6 billion ($9.5b). That's quite a lot less than the $US7.9b ($12.5b) the year previously.
So what's behind the decline?
In an update to subscribers of its newsletter, the global art auction house reiterated that it still is the market leader in sales.
"We delivered this result in a market constrained by fewer objects and collections coming up for sale," CEO Charles Stewart wrote, adding that "lot volume" was down 14%.
"When we brought work to market, it sold excellently.
"Our sell-through rate was 85%, an increase on last year and, in fact, our highest in the past decade. We simply had far more demand than supply."
Meanwhile, Sotheby's also got a cash injection of $US1b from the Abu Dhabi sovereign wealth fund ADQ.
"This capital puts our balance sheet in a position of strength, creates room for additional investment in our business, and also deepens our connection to the Middle East," Mr Stewart said.
"An important growth region for us and a place where we have several initiatives planned for 2025 and beyond."
Not a whole lot is disclosed about profits. Sotheby's notes it gave away $US120 million in 2024 to charities.
Want to know more about the secretive art industry? You can read this investigation I did on Sotheby's and Indigenous art sales royalties last year.
Shoppers abandon payments after receiving scam warnings
NAB has released figures showing customers abandoned $48.5 million worth of payments in the past two months after being promoted with scam warnings.
December was the biggest month in 2024 for abandoned payments as shoppers spent big in the lead-up to Christmas.
The bank's real-time alerts target invoice, investment, romance, and goods and services scams and are its latest tactic to try and prevent customers from losing huge sums to scammers.
The data comes as the government continues to grapple with who is responsible for scam losses.
Do you know more? Or have you lost money to a scam? Contact me at [email protected]
Technology companies such as Facebook and Google recently made a joint submission to the government's Scams Prevention Framework bill, saying they should not be expected to pay out compensation to scam victims and said the blame should be laid squarely on banks.
Under the government's plan, fines of up to $50 million would be imposed on banks, telcos and social media companies that fail to act to prevent scams.
Banks unsurprisingly disagree with the tech companies and want a shared model, especially given so many scams start on social media or via text messages.
Australian gold price touches record high, above $4,400 an ounce
If you've been on the lookout for wedding rings — or jewellery containing gold — you may have noticed they're a lot more expensive these days!
In fact, the price of spot gold briefly hit a new record high of $4,403 an ounce yesterday. That's if you're paying in Australian dollars.
Just to further labour the point, its value has surged 60% in the past couple of years. (An ounce of gold in late January 2024 was worth $2,710).
You may be wondering: what's going on?
The gold price, in Australian dollars, is at it highest level ever. (Refinitiv)
Firstly, the precious metal's price tends to rise in times of uncertainty (ie. wars and global conflict creating) — and periods of high inflation which lead to the devaluation of fiat currencies.
So it has traditionally been propped up by "safe haven demand" and as a "hedge against inflation".
On top of that, many central banks have been purchasing huge stockpiles of gold, including Poland, India, Qatar, Hungary, Jordan and the Czech Republic. (However, the largest gold reserves are still being held by the United States, Germany and Italy).
Lately, there has been a "de-dollarization" movement by central banks — to hold other reserve assets and diversify away from the US dollar and US Treasury bonds.
Weak Aussie dollar playing a role
In addition, the Australian dollar has been incredibly weak recently — after dropping 5.5% since Donald Trump's US election victory in November.
(It's now trading at 62.8 US cents, after briefly tumbling to a five-year low in early January).
The weak Aussie dollar makes it more expensive to purchase assets like gold.
And why is that? Well … it's because the international price of these commodities is priced in US dollars (and the greenback has risen to a two-year high).
So the weak exchange rate means we can't get as much US currency (and we have to pay more for assets which are valued in US currency).
The price of gold edged slightly lower to $4,399 an ounce, at 1:10pm AEDT.
However, if you're buying gold with the strong US dollar, the price will be $US2,766 — which is a three-month high (not quite a record).
Rio Tinto shipments could be hit by cyclone disruptions
Rio Tinto warned on Friday that its first-quarter shipments could be affected by disruptions to its rail operations following record rainfall along Western Australia's Pilbara coastline due to tropical cyclone Sean.
A railcar dumper at the East Intercourse Island (EII) port facility, which handled 45 million metric tons of total iron ore shipments in 2024, had experienced severe flooding, the producer of the steel-making commodity said.
The situation is currently under assessment with preliminary findings indicating that the EII dumper may be out of operation for three to four weeks for repair work, Rio said.
"Recovery works within the broader Iron Ore system are progressing, with the majority of rail and port operations now returned to operations," the company said, adding it was maintaining its overall shipment forecast for 2025.
Heavy rains led Rio Tinto to report a 1% fall in its iron ore shipments in the December quarter, highlighting the recurring impact of severe weather conditions on production, particularly in the rain-stricken Pilbara region.
Meanwhile, Port Hedland, which is integral to iron ore shipments from miners such as BHP Group nd Fortescue, reopened on Monday after the threat posed by the cyclone subsided, with operations resuming following clearance from the Pilbara Ports Authority.