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Speaker 1: Inflation creeps down, but it's not clear if it'll be

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Speaker 1: enough to convince the Reserve Bank. Nine Entertainment suffers a

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Speaker 1: big profit blow as the TV ad market flops, and

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Speaker 1: China's biggest retailer, JD dot Com plans a major share

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Speaker 1: buyback amid economic slowdown, fears. Welcome to Fear and Greed.

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Speaker 1: Daily business news for people who make their own decisions.

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Speaker 1: It is Thursday, the twenty ninth of August twenty twenty four.

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Speaker 1: I'm Michael Thompson and good morning, Adam Lang.

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Speaker 2: Good morning, Michael, Adam.

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Speaker 1: The main story this morning. Inflation is continuing its slow down,

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Speaker 1: with the monthly headline Consumer price index dropping to three

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Speaker 1: point five percent in the year to July. This has

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Speaker 1: been a much anticipated measure given many other countries are

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Speaker 1: looking at rate cuts.

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Speaker 2: That's right, Michael. In June the measure was at three

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Speaker 2: point eight percent, but now at three point five percent,

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Speaker 2: that's in the year to July. It is heading in

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Speaker 2: the right direction. However, it still is a bit higher

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Speaker 2: than the market consensus of three point four percent. Housing,

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Speaker 2: food and non alcoholic beverages, clothing and footwear, and alcohol

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Speaker 2: and tobacco were the most important contributors to that lift.

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Speaker 2: Fruit and vegetables were up, while housing and related expenses

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Speaker 2: were also a significant contributor. And that's even though the

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Speaker 2: government's electricity subsidies helped those charges. Federal Treasurer Jim Chalmers

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Speaker 2: said it is a welcome progress in the fight against inflation.

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Speaker 2: It is the final monthly data before the RBA meets

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Speaker 2: in late September. Though most economists have not changed their

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Speaker 2: expectations for rates based on this data, February twenty twenty

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Speaker 2: five remains the date most expect the Central Bank to cut.

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Speaker 2: Of course, the RBA will look through the headline data

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Speaker 2: as we know Michael to instead focus on underlying inflation,

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Speaker 2: which strips out those one off government support and some

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Speaker 2: subsidy measures. Interestingly, new research from Roy Morgan shows that

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Speaker 2: more than one point six minion mortgage we're at risk

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Speaker 2: of mortgage stress in July. That is a big number,

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Speaker 2: even though it's a slight decrease from the June figures. Now,

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Speaker 2: those Stage three tax cuts are helping to put more

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Speaker 2: space between workers' incomes and their debts. But clearly though,

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Speaker 2: lots of people will still be looking for rate relief

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Speaker 2: in the months ahead to help take more of that

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Speaker 2: pressure off.

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Speaker 1: Yeah, with so many people under pressure, Adam, it probably

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Speaker 1: goes without saying that it must be hitting the retail

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Speaker 1: sector pretty hard as true.

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Speaker 2: Michael Deloitte Access Economics actually published a report late last

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Speaker 2: night that now estimates that Australia has been in a

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Speaker 2: retail recession for eighteen months and from now until Christmas,

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Speaker 2: it's still looking like it's going to be brutal for

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Speaker 2: shop owners in the retail market. Amongst this, there was

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Speaker 2: one bit of good news. This final period will be

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Speaker 2: short and shallow on their estimates, with twenty twenty five

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Speaker 2: and twenty twenty six indicating a recovery and a return

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Speaker 2: to growth, and that is welcome news. I'm sure the

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Speaker 2: forecasts show real retail turnover will be lifting from point

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Speaker 2: three percent this year to one point five percent for

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Speaker 2: the next two years. In the meantime, they're expecting retail

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Speaker 2: businesses to focus heavily on cost control and occasional discounting

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Speaker 2: and investing in technology to improve efficiencies and customer experience.

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Speaker 2: We'll get the official retail data this Friday and that'll

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Speaker 2: give us more insights into what's happening. And as a reminder,

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Speaker 2: for bargain hunters. Michael, and I know this will interest

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Speaker 2: you that Black Friday online sales are scheduled for Friday,

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Speaker 2: twenty nine November and they'll end on Cyber Monday, the

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Speaker 2: second of December.

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Speaker 1: I love the two giving us what a two and

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Speaker 1: a half month heads up on this, just so that

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Speaker 1: we can start planning our shopping around this so far out.

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Speaker 2: I know it's not even September yet, but I'm already

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Speaker 2: thinking of Christmas.

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Speaker 1: It's smart plan ahead, Adam. Taking a look at local markets.

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Speaker 1: The SMPASX two hundred closed flat yesterday at eight thousand

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Speaker 1: and seventy one points, with a surprise late uplift, reversing

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Speaker 1: a day that was spent mainly in the red. Consumer

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Speaker 1: staples and financials were among the best performers and helped

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Speaker 1: drive what really was an afternoon resurgence. Resources, communication services, energy, metals,

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Speaker 1: and mining all slumped throughout the day.

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Speaker 2: Well that's right, Michael, and then the broader market, as

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Speaker 2: you said, just crawled out of the red towards the

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Speaker 2: end of the afternoon. Woodside Energy was down one point

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Speaker 2: two percent, with Santos dropping zero point seven percent. Four

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Speaker 2: to Skew Metals fell one percent. Inflation and consumer spending

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Speaker 2: have been major themes this earning season. Bed linen and

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Speaker 2: soft furnishings retailer Adares said foot traffic had fallen sharply

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Speaker 2: and its net profit after tax dropped seventeen point eight percent.

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Speaker 2: Their shares were down more than five percent. A big

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Speaker 2: surprise came from women's where retailer City Chek, which reported

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Speaker 2: earnings before interest, tax, depreciation and amortization. That's that snappy acronym,

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Speaker 2: Michael Iberitt dah. They had a loss of eight point

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Speaker 2: four million, and that was nearly a fifty percent improvement

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Speaker 2: on the previous financial year, and it shares actually went

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Speaker 2: up by double digits. On the news, Tabcorp was also

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Speaker 2: a poor performer over the day. It was down fifteen

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Speaker 2: percent after flagging in its earnings. That challenging conditions would continue,

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Speaker 2: and we'll discuss that one a bit more shortly.

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Speaker 1: Adam, you mentioned Woodside Energy before, and today's interview, which

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Speaker 1: comes up after the show, is actually a chat with

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Speaker 1: Woodside CEO Meg O'Neil. It is a great interview. It

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Speaker 1: comes to us courtesy of our friends at osbi'z. We've

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Speaker 1: been working with them to put together a series of

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Speaker 1: interviews with business leaders. Osby's is Australia's leading provider of

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Speaker 1: live and on demand video of the latest news in

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Speaker 1: Australian business markets, economy startups. Of course it is free

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Speaker 1: to sign up at Osby's dot com dot au. But

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Speaker 1: the interview is so interesting because Meg O'Neil just talks

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Speaker 1: right across the range of projects and they are some big,

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Speaker 1: big projects the woodside has at the moment, including the

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Speaker 1: thirty billion dollar Brows development north of Broom, which was

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Speaker 1: rejected on environmental grounds, including the threat to the pygmy

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Speaker 1: blue whale. There's a whole lot in this interview. It

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Speaker 1: is a fascinating insight into an oil and gas producer,

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Speaker 1: including climate change and sustainability, all of that kind of thing,

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Speaker 1: So well worth a listener after the show. International markets

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Speaker 1: a quick look here Internationally, Adam. At the moment it's

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Speaker 1: all about Nvidia. The US markets are waiting on its

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Speaker 1: second quarter results which are due this morning. These results

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Speaker 1: will be seen really as a major indicator of how

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Speaker 1: optimistic investors should or should not be about new tech

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Speaker 1: like AI. So the States are obviously pretty high. We

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Speaker 1: will take a closer look at that this afternoon in

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Speaker 1: the afternoon report.

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Speaker 2: That's right, Michael, And according to Bloomberg, this is compared

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Speaker 2: with news from the Bank of America, whose clients have

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Speaker 2: been pulling cash from US stocks for the first time

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Speaker 2: in three weeks. The most significant sector experiencing the outflow

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Speaker 2: was in fact technology now. Interestingly, though for technology ETFs,

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Speaker 2: it's a different story that asset had the biggest inflows

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Speaker 2: of capital. Meanwhile, in China, bottled water producer Nongfu Spring

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Speaker 2: has had a hard time with double digit share price falls.

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Speaker 2: That was following a sharp slow down in profit growth

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Speaker 2: for its first half results. It's blaming competition, a backlash

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Speaker 2: and malicious defamation. CNBC reports that nationalist Chinese internet users

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Speaker 2: are accusing the business of using pictures of Japanese religious

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Speaker 2: buildings on its Green tea labels and have launched a boycott.

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Speaker 2: LongFu says the imagery is based on Chinese temples. Imagine

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Speaker 2: trying to deal with that one god. On a slightly

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Speaker 2: different note, it's worth keeping an eye on grain futures,

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Speaker 2: which have risen in Chicago due to pretty poor weather

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Speaker 2: in the US farm belt, which is threatening crop conditions

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Speaker 2: for soybeans, corn, and wheat. Hot weather without enough rainfall

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Speaker 2: is behind those concerns about crop yields.

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Speaker 1: Adam, we have a fair bit to get through today.

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Speaker 1: There's been a lot of business news around in the

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Speaker 1: last twenty four hours. We'll be back in a moment

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Speaker 1: with the rest of the day's business news. Adam Greens

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Speaker 1: leader Adam Bands is trying to be the Robin Hood

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Speaker 1: of the business world. He used a National Press Club

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Speaker 1: address yesterday to relaunch his plans to slug corporations with

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Speaker 1: big new taxes.

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Speaker 2: Here Michael, He's called it the Big Corporation's Package, in

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Speaker 2: a bid to tackle what he is describing as excessive

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Speaker 2: profits from large companies. Now. This includes a proposed forty

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Speaker 2: percent tax on coal and mining businesses, and that was

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Speaker 2: similar to Kevin Rudd's resource super profit tax. He's also

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Speaker 2: proposing a petroleum resource rent tax and a forty percent

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Speaker 2: tax on so called excessive profits for companies whose turnover

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Speaker 2: is one hundred million dollars in over. Now, he's had

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Speaker 2: his plan costed by the Parliamentary Budget Office and it

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Speaker 2: reckons that all these components together will generate five hundred

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Speaker 2: and fourteen billion extra for the federal purse over ten

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Speaker 2: years now. The Henry Tax Review some time ago recommend

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Speaker 2: it a forty percent resource superprofit tax, so there is

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Speaker 2: some heritage there. Employer Association AI Group CEO Innes Willocks

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Speaker 2: called the Greens approach a naive cash grab that would

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Speaker 2: gouge businesses, heard investors and damage job growth prospects. The

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Speaker 2: Business Council said it would drive jobs and businesses away

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Speaker 2: as Australia would have the highest tax rate in the OECD. So, Michael,

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Speaker 2: as you can see, there's quite the war of words

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Speaker 2: over tax here.

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Speaker 1: Oh yeah, that sure is. And Adam Bant was also

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Speaker 1: pushed on the issue of Green Senator Max Chandler May,

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Speaker 1: who's been blasted by Workplace Relations Minister Murray Watt after

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Speaker 1: he spoke at a CFMEU rally that had attendees holding

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Speaker 1: up signs likening the Prime Minister to a Nazi.

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Speaker 2: Yes, so, Michael, you get the feeling that there's some

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Speaker 2: electioneering going on towards the forthcoming federal election. The minister

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Speaker 2: described chandler may appearance at the Brisbane rally as very

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Speaker 2: very disturbing on ABC Radio nationh. The CFMEU was forced

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Speaker 2: into administration by the Albanese government last week, and that

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Speaker 2: was following media reporting of links between the union and

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Speaker 2: organized crime and also allegations of corruption. Construction workers across

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Speaker 2: the country went on strike in protest. Chandler may have

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Speaker 2: said in his speech that it was an attack on

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Speaker 2: every worker in this country as it's set a precedent

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Speaker 2: for future governments on how to seize control of trade

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Speaker 2: unions or civil society associations.

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Speaker 1: Okay, turning away from politics now and into an area, Adam,

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Speaker 1: where you have a great deal of expertise. We're talking

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Speaker 1: about media here. Nine Entertainments profits plummeted twenty two percent

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Speaker 1: to two hundred and sixteen point four million dollars, with

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Speaker 1: revenues down three percent to meter a week television advertising market.

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Speaker 1: Almost a third of Nine's revenue is now coming from

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Speaker 1: subscriptions and licensing when excluding a property listing site domain,

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Speaker 1: so advertising remains a crucial component.

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Speaker 2: Yeah, that's right, Markle, and for its part, Nine thinks

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Speaker 2: the TV market will experience a positive trend going forward,

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Speaker 2: with the Paris twenty twenty four Olympic Games putting a

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Speaker 2: bit of win back in its sales that has largely

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Speaker 2: been behind a ten percent lift, but without these games,

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Speaker 2: it would be looking at low to mid single digit

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Speaker 2: to climb. Now nine is cutting back one hundred million

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Speaker 2: from its cost base over the twenty twenty four and

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Speaker 2: twenty twenty five financial years. A fully franked dividend of

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Speaker 2: four point five cents a share has been announced, and

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Speaker 2: that is eight point five cents for the full year.

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Speaker 1: Adam Grocery Giant Woolworth's net profit fell zero point six

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Speaker 1: percent over the last financial year, though sales increased five

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Speaker 1: point six percent, with the Australian supermarket sector behind most

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Speaker 1: of the increase.

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Speaker 2: Yeah Michael. The New Zealand supermarkets dragged down the overall

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Speaker 2: result with a one point five billion dollar impairment. The

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Speaker 2: markets were pretty happy though overall, with Woolli's giving shareholders

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Speaker 2: a higher than anticipated forty cent special dividend after selling

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Speaker 2: a five percent stake in Endeavor Group. That was on

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Speaker 2: top of a fifty seven cent final dividend. CEO Brad

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Speaker 2: Banducci said sales for the first two months of the

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Speaker 2: current financial year were up three percent. That's some good news.

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Speaker 2: Some of that was due to modest price increases. Prices

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Speaker 2: are still going up rather than going down at big

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Speaker 2: grocery stores, but there's also some growth in terms of

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Speaker 2: item sales, that's sales volume. By comparison, Coals estimated a

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Speaker 2: three point seven percent lift of the same period. Big W,

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Speaker 2: which will worse owns, is having less success with flat

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Speaker 2: sales and discounting needed to attract customers to spend.

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Speaker 1: Now, Adam, it might feel like lockdowns were a very

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Speaker 1: long time ago, but obviously their effects have been long

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Speaker 1: lasting for plenty of businesses. Among them, probably some of

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Speaker 1: the hardest hit would have been the travel sector. It

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Speaker 1: does seem that there has finally been a turnaround, though,

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Speaker 1: with flight center earnings hitting a fresh record. This is

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Speaker 1: good news.

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Speaker 2: Yeah, it is good news. Michael and I still get

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Speaker 2: a bit of a twitch when I think of lockdowns.

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Speaker 2: This new shows they've officially surpassed pre COVID levels, airfares

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Speaker 2: have been moderating, and travel demand is holding up pretty well.

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Speaker 2: One of the sectors driving this is cashed up older Australians,

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Speaker 2: some of whom are benefiting from higher interest rates and

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Speaker 2: a solid investment market. There were twenty three point seven

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Speaker 2: four billion dollars worth of transactions in the year to

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Speaker 2: June thirty, and that was bigger than the twenty nineteen results.

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Speaker 2: Underlying profit was smack in the middle of a guidance

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Speaker 2: at three hundred and twenty million dollars. Flight Center has

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Speaker 2: announced a final dividend of thirty cents a share that

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Speaker 2: is fully franked.

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Speaker 1: Cashed up older Australian seems a good time to mention

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Speaker 1: that Sean is having a bit of a holiday at

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Speaker 1: the moment. Nice one he has jetted off. The worst

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Speaker 1: part is he's not even going to hear this.

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Speaker 2: Well. There might be some reports that get to him, though, Michael,

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Speaker 2: we are at risk.

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Speaker 1: Yeah, oh, you know what, I'm pretty comfortable with it.

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Speaker 1: I'd probably say it to his face if he was

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Speaker 1: here as well, you would. But he's enjoying a well

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Speaker 1: earned break. He's probably actually drinking a cocktail right now,

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Speaker 1: which is odd considering the time of morning that it is.

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Speaker 1: But you know what, it's on holidays, so there is

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Speaker 1: no judgment here, Adam. Turning to international news now, I

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Speaker 1: mentioned this one at the top of the show. China's

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Speaker 1: biggest retailer, JD dot Com, is planning to buy back

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Speaker 1: up to five billion US dollars worth of its own

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Speaker 1: shares amid major concerns about a decline in consumer purchasing.

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Speaker 2: Yeah, Michael. This massive retailer had pushed well through its

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Speaker 2: Dune quarter profit estimates, but has been struggling with investor

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Speaker 2: fears about the local retail market, particularly after rival Temu

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Speaker 2: was a big miss on revenue expectations. This marks its

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Speaker 2: second share buy back for twenty twenty four, having gone

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Speaker 2: through a US three billion dollar round previously announced in March,

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Speaker 2: and it's a theme we're seeing from big digital retailers

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Speaker 2: in the region. If you cast your mind back to February,

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Speaker 2: you will remember that Ali Barber announced a US twenty five

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Speaker 2: billion dollars share buy back. We've been talking plenty on

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Speaker 2: fear and greed about the slowdown in China, which has

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Speaker 2: included a lot of upheaval in the sluggish property mark.

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Speaker 2: JD dot Com will continue to be a litmus test,

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Speaker 2: with Walmart selling off its multi billion dollar holding in

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Speaker 2: the business earlier in August to pursue its own interest

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Speaker 2: in China. China's economic success has significant implications for companies

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Speaker 2: in Australia too, with the Reserve Bank recently putting a

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Speaker 2: question mark over our biggest training partner, we know it's

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Speaker 2: a key source of uncertainty for our current economic outlook.

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Speaker 1: Adam Donald Trump faces a new federal indictment. It's an

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Speaker 1: interesting situation this one because it's the same for charges

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Speaker 1: brought against him last year, but following a ruling that

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Speaker 1: former presidents largely are immune from criminal prosecution. This time

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Speaker 1: the charges are focused on him as a political candidate

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Speaker 1: looking to be re elected.

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Speaker 2: Yeah, Michael, those charges are accusations that he allegedly took

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Speaker 2: part in a conspiracy to block the certification of his

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Speaker 2: election defeat to Joe Biden. Fake claims of voter fraud

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Speaker 2: are at the heart of this case, and Reuters has

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Speaker 2: reported that the updated indictmond relies on key testimony and

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Speaker 2: evidence from witnesses outside of the government, including ex Arizona

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Speaker 2: House speaker Rusty Bowers. It no longer includes the earlier

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Speaker 2: allegations that he tried to pressure the US Justice Department

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Speaker 2: to overturn his loss. So this is going to be

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Speaker 2: interesting to see if Kamala Harris and running mate Tim

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Speaker 2: Waltz are asked about the case of their first interview,

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Speaker 2: which will be with CNN on Friday, Australian time.

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Speaker 1: Yeah, it'd be fascinating. Just speaking of US politics, meta

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Speaker 1: CEO Mark Zuckerberg reveals this week that he had been

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Speaker 1: pressured into censoring COVID related content on Facebook. In a

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Speaker 1: letter to the US House of Representatives Judiciary Committee, he

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Speaker 1: said that this happened during the pandemic, and he regretted

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Speaker 1: not saying something about the intervention earlier.

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Speaker 2: Here, Michael, the content was fascinating. The platform was under

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Speaker 2: pressure during the height of the virus due to alleged

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Speaker 2: misinformation being spread on it, particularly about vaccines. Zuckerberg now

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Speaker 2: says he was pressured into censorship and would push back

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Speaker 2: if art to do the same thing again and over.

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Speaker 1: In Europe, Adam UK Prime Minister Kiis Starmer is in

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Speaker 1: Germany in a bid to, in his words, reset relations

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Speaker 1: across the region and turn a corner on Brexit.

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Speaker 2: It is such interesting phrasing, isn't it, Michael. He is

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Speaker 2: visiting Germany to start talks on a new cooperation treaty.

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Speaker 2: The agreement is expected to cover energy, security, technology, science

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Speaker 2: and trade opportunities and includes improving market access. However, the

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Speaker 2: treaty might not come about until early twenty twenty five,

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Speaker 2: so it's all very early in the discussions. Despite a

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Speaker 2: defense agreement already being negotiated and due to be finalized

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Speaker 2: in the next few months. Kiirs Starmer is then heading

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Speaker 2: to Paris to talk to French President Emmanuel Macron and

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Speaker 2: this is all part of Starmer's attempt to get trading

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Speaker 2: with his neighbors again. Now if he pulls this off,

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Speaker 2: benefits are expected for a range of industries, including the

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Speaker 2: art scene. British labor is trying to reduce border checks

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Speaker 2: on food products, but also reduce paperwork for artists on

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Speaker 2: tour and make it easier for citizens to access specific jobs.

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Speaker 2: As an aside, it's good timing for his Parisian adventures,

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Speaker 2: as the BBC reports that he will get to attend

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Speaker 2: the opening ceremony of the Paralympics while he's there.

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Speaker 1: Just on the UK German relations, Adam, did you see

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Speaker 1: the story recently about the German warship that was kind

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Speaker 1: of cruising up the temps. Oh? I did, going into

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Speaker 1: London and they were blasting the Imperial March, Darth Vader's

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Speaker 1: theme song from Star Wars because they can play across

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Speaker 1: the big speakers as they went up up the river.

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Speaker 1: And so I raised a few eyebrows, as you can imagine.

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Speaker 1: And I love that Germany's Navy had to come out

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Speaker 1: and actually just clarify there was no deeper message here

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Speaker 1: in the choice. The commander of the ship just loves

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Speaker 1: Star Wars. This is the that's the thing. But it's

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Speaker 1: certainly it's certainly got some traction on social media that

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Speaker 1: this this image of this massive ship.

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Speaker 2: Yeah, imagine if you're just walking along the Thames and

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Speaker 2: you hear something, turn and see this boats cruising along

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Speaker 2: in the theme music playing what.

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Speaker 1: A bizarre sing Yeah. And I love the fact that

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Speaker 1: they get to choose. The commander gets to pick whatever

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Speaker 1: music they play, and he's clearly just decided Yep, this

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Speaker 1: is what I'm going to do. So like it's speaking

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Speaker 1: our language because you and I both love Star Wars,

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Speaker 1: so it's I get why he's done it. But hey,

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Speaker 1: maybe not if you're trying to avoid a diplomatic incident,

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Speaker 1: maybe not the best choice.

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Speaker 2: Ah maybe maybe Also, Mike, if you're going to do anything,

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Speaker 2: go big.

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Speaker 1: Exactly well said, Okay. Up next is the Fear and

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Speaker 1: Greed Daily Interview. Today's guest is Woodside CEO Meg O'Neill.

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Speaker 1: It is a fantastic interview courtesy with our friends at

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Speaker 1: Osby is well worth. A listener is up next to

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Speaker 1: the Fear and Greed playlist on your podcast platform or

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Speaker 1: at fearanngreed dot com dot au.

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Speaker 2: Thank you Adam, Thank you Michael.

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Speaker 1: It is Thursday, the twenty ninth of August twenty twenty four.

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Speaker 1: Make sure you're following the podcast and please join us

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Speaker 1: online on LinkedIn, Instagram, x TikTok and Facebook. By Michael Thompson.

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Speaker 1: And that was Fear and Greed. Have a great day.