A fatter wallet to start the new year

Hey Superheroes,

Happy New (Financial) Year! FY25 seems to be decent so far – both the ASX and Wall Street have been green, we’re getting more pay in our pockets (yay tax cuts!) and the AUD has gotten a tad stronger.

Additionally it’s a big month for dividends. Several stocks and ETF providers such as Vanguard and VanEck are paying out this July. That’s money in your Superhero Wallet you’re reinvesting… right? 

Here are this week’s stories.

The Aussie Government’s help for the wallet

The start of FY25 is marked with lots of new and exciting legislation finally kicking in, and many are set to potentially add more cash into your wallet (or investment portfolio!).

🛒 Easing cost of living pressures

The Aussie Government has launched some initiatives to ease cost of living pressures. Timely, given we found out last week that inflation is back up again.

Here’s a short summary:

• Income tax cuts:
  • Reducing the 19% and 32.5% tax rates to 16% and 30%, respectively. 
  • Increasing the income threshold for which higher tax rates apply; from $120,000 to $135,000 for the 37.5% tax rate and from $180,000 to $190,000 for the 45% tax rate.
  • See how much extra you could take home.
• $300 energy bill rebate for Aussie households and small businesses.
• Student loans indexed to the lower of CPI or the Wage Price Index. This is now current for this financial year, but will also be retroactively applied from 1 June 2023. 
• Increases to the income thresholds for both the Medicare levy (for FY24) and Medicare levy surcharge.

🦸 Plus some super changes

• Increase of the Super Guarantee from 11% to 11.5% for FY25.
• Increases to both concessional and non-concessional contribution caps.

Is Australia soon seeing more oil money? 

While all eyes have been on renewables in recent years, the circle of oil and gas producers has been getting smaller. And that’s not because they’re losing money and shutting down – it’s the case of the big bosses eating up the little players.

ExxonMobil (XOM.US) for example recently acquired Pioneer Natural Resources and its 16 billion barrels of oil equivalent resource for nearly US$60 billion. And there’s also Chevron (CVX.US) now fighting to get Hess Corporation for US$53 billion.

There’s money going around in the industry… lots of it.

🛢️ Drumming up the suspense

Recently, the spotlight has turned to our local Santos (STO.AU). The Adelaide-based oil and gas producer saw its shares jump this week amidst growing speculation that it’s being eyed by two Middle Eastern energy giants for a potential takeover acquisition. 

Yup, those are Saudi Aramco and Abu Dhabi National Oil Company (ADNOC).  

Santos hasn’t confirmed anything so far. One analyst believes it to be all rumours, suggesting that takeover interest in Santos isn’t likely from the Middle East but from energy giants in Europe.   

Either way, investors are probably waiting to see Santos’ next steps after its failed merger with Woodside Energy (WDS.AU) earlier this year.

🔦  Some other things we’re shining the Spotlight on:

• AUSSIE SPIES ON A CLOUD: The Aussie Government has partnered up with Amazon (AMZN.US) for the latter to build and run “top secret data centres” for Aussie spies. The decade-long deal is expected to be worth over A$2 billion, creating up to 2,000 jobs.
• LENDLEASE X STOCKLAND: The ACCC previously blocked a A$1.3 billion sale of assets between the two property developers, flagging concerns around less competition. It’s now added a two-month deadline for the pair to either cut one-third of the assets out of the sale or prove them wrong.
• PAST IS PAST?: Tesla (TSLA.US) rallied 26% in the last five days following vehicle production and delivery numbers that beat analyst expectations. The price gains have nearly brought Tesla back to its share price at the start of the year.

Wall Street’s quarterly earnings season is set to start again next week. 

Keep up to date on the markets by following us on Instagram, @superheroau!