Good morning. Wall Street ended the week little changed on Friday, the S&P 500 flat at 7,354 and the Nasdaq down 0.2% to 25,298, capping a five-session slide that left the S&P 2.0% lower over the week and the Nasdaq down 4.6%. The selling centred on chipmakers and the AI complex, after a report that OpenAI may push its listing into 2027 and as investors questioned the cost of the data-centre build-out. Over the weekend the Bank for International Settlements lent that worry an institutional voice, warning in its annual report that AI spending, increasingly funded by debt and private credit, could turn from boom to a protracted investment bust with knock-on effects for credit markets.
Treasuries firmed, the US 10-year yield down 2 basis points to 4.37% and 8 basis points lower over the week, with the 2-year at 4.09%. Brent crude fell 3.5% to US$72.60, its lowest since February, as Gulf shipping recovered, though the United States and Iran exchanged fresh strikes over the weekend and the head of Japan's NYK Line said mines will hold Strait of Hormuz traffic below half its pre-war level for months. Gold rose 1.6% to US$4,096 and copper 2.2% to US$13,684.
Locally, the ASX 200 closed Friday up 0.2% at 8,764, with iron ore steady at US$100.33 a tonne and the Australian dollar at US68.95 cents. ASIC turned to the largest superannuation platforms, finding trustees overseeing more than $300bn across 977,000 accounts are still not doing enough to protect members, and said it would name and enforce where needed. RBA Assistant Governor Christopher Kent speaks at 11:30am AEST, with the cash rate held at 4.35%.
Money markets price no change at the next meeting, and the major banks are split on whether the next move is up or down given Middle East energy costs. Assistant Governor Christopher Kent speaks at 11:30am AEST.
The 15-month review followed the collapses of the Shield and First Guardian funds; ASIC said it was overwhelmingly disappointed at the lack of progress since 2024 and would name and enforce where needed.
Preliminary auction clearance rates have slipped to about 47%, the weakest since April 2020, while rents rose 5.9% over the year to May; budget changes to negative gearing and capital gains tax have added to the slowdown.
It flagged four pressure points, re-accelerating inflation, lingering supply shocks, financial fragilities and the durability of AI spending, and noted that AI capex is increasingly funded by debt, private credit and hedge funds rather than operating cash flow.
Core PCE rose to 3.4% in May, the highest since October 2023, and the June payrolls report is due later this week; most economists polled expect the Fed to hold, with some flagging the risk of a rise.
Gulf exports have recovered toward about 75% of pre-war levels, but the head of NYK Line said mines will keep Strait of Hormuz shipping below half pre-war volumes for months, and the US and Iran exchanged fresh strikes over the weekend. Gold rose 1.6% to US$4,096 and copper 2.2% to US$13,684.
Vietjet, named the world's top budget airline for 2026, already flies Sydney and Melbourne to Ho Chi Minh City and has more than 100 aircraft on order.
Jessica Farrell becomes President North America from 1 July, and President Australia Geraldine Slattery adds Copper South Australia, bringing all Australian operating assets under her remit.
The portal would circulate reports of suspicious behaviour across the industry and may be extended to bank staff found doing the wrong thing.
Bullion is up 22.9% over the past year, though it has eased 3.0% over the past five sessions.
The limits hit Meta harder than other clients given the scale of its request and prompted Meta to tell staff to use AI resources, including model tokens, more sparingly. Google Cloud books about US$20bn in revenue a quarter.
Momentum runs about 4,000 miles of pipeline with capacity of 6 billion cubic feet of gas a day across the Haynesville shale, as demand from LNG export and data centres lifts US gas infrastructure.
The ruling could shape the global royalty rates set for standard-essential technologies used across the industry.
Firmus is targeting about $43bn in revenue as it diversifies beyond Australia, where its projects face closer government and taxpayer scrutiny.
“Disappointment in returns could trigger a sudden pullback in financing and turn the capex boom into a protracted investment bust, with potential knock-on effects on financial conditions.”
“Inflation remains well above target and growth remains solid. This will keep the Fed on hold for quite some time, until conditions allow for a cut.”
“We don't view this as a bubble that's likely to pop anytime soon, just a rally that has gone on and on, seemingly unabated.”
“We're still nowhere near returning to conditions before the closure of the Strait of Hormuz.”
“Electric load from data centres is going to grow threefold by 2030.”
“We will be naming, and if necessary, we will be shaming, and we will be enforcing where appropriate.”
For wholesale clients only. Prepared by Arc Point OCIO Pty Ltd (ACN 693 569 765), Corporate Authorised Representative (CAR 1319046) of Capella Advisory (AFSL 550125), for wholesale clients within the meaning of the Corporations Act 2001 (Cth); it is not intended for, and should not be relied on by, retail clients. This note is factual market reporting and general information, with any arcpoint view clearly labelled as such. It is not personal advice and does not take into account any person's objectives, financial situation or needs. Information is drawn from sources believed to be reliable but its accuracy and completeness are not guaranteed. Past performance is not a reliable indicator of future performance.
Sources: Yahoo Finance, FRED, RBA, company filings.