The RBA was considering a rate hike this month

Hey Superheroes,

What a heavy week it’s been! Global markets experienced a broad sell-off with both the ASX 200 and S&P 500 currently at 10-week lows. 

Qantas’s ex-CEO Alan Joyce is not having the best time either. Almost half of his $21.4 million final pay packet is at risk of being revoked thanks to all the current criticism surrounding the Flying Kangaroo. 

Are we there yet, RBA?

September began with the RBA’s decision to hold the cash rate at 4.10%. Some investors even crossed fingers for a rate cut, given slowing inflation data.

Well, the central bank released the minutes from their meeting a few days ago. 

But to save you the hassle of digesting all of those cumulative minutes, we’ve pulled out the main insights:

🇦🇺 Inflation: Too early to rejoice

While Aussies can now breathe a little better from when inflation was at 7.8%, the latest number at 4.9% last July is still a weeeee bit too high for the RBA. 

Pointing a finger at increasing house prices and persistently high services price inflation, the central bank considered another rate hike of 25 basis points earlier this month.

In the end, they held rates in order to give previous hikes a chance to flow down to the economy. They were also getting jitters about China’s risk to our Aussie economy. 👇

🇨🇳 An eye on China

If you noticed the recent volatility in mining stocks and the weakness in the Aussie Dollar, it’s because the Chinese economy hasn’t been doing too well lately.

China’s property sector has been battling weakening sales and bankruptcies amongst developers for a few months now. For a country obsessed with property investment, it’s been a big issue that’s already spilled over to other industries. Especially the financial sector. A few state-owned firms had already started to miss payments on debt.

Whether we like it or not, Australia relies heavily on China’s imports. Everything from iron ore to wine. Let’s hope their situation improves.

Disney’s un-magical share price

Disney’s stock price just hit a 9-year low. But analysts aren’t surprised. 

The company’s streaming platform, Disney+, is still loss-making. But most importantly, the entertainment giant’s theme parks have been lacklustre.

🎡 Disney (Ghost) Land

While Disneyland usually goes hand-in-hand with big crowds and long lines, this year saw a rather opposite spectacle.

Wait times for rides used to average 41 minutes. But this July, parks recorded just 33 minutes. Similarly, foot traffic fell about 23% last quarter. 

Disney CEO Bob Iger blamed the slowdown on extreme heat and doesn’t expect it to be a long-term issue. That remains to be seen.

In the meantime, Disneyland’s offering up a bargain bonanza. 

💡 Fun fact of the week:

Did you know that September has historically been the weakest month for the S&P 500? 🫣 

Dubbed the “September Effect”, the index has lost an average of 1.1% during the month since 1928. 📅

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

THE FED’S REMINDER: Global markets fell following the Fed’s announcement last Wednesday to hold its benchmark interest rate within the range of 5.25-5.50%. While U.S. inflation is down to 3.7%, Powell reminds us all that it’s still a long way off its 2.0% target – quelling hopes of a rate cut.

SHINY NEW TECH STOCKS: Instacart (NASDAQ:CART), a grocery delivery service, and Klaviyo (NYSE:KYVO), a marketing automation firm, were given a warm welcome into the U.S. markets this week with double-digit price jumps on debut day. Both are now available to trade on Superhero.

ONLINE DATING ULTIMATUM: The Albo government just warned dating apps that if a code of practice to protect users from sexual harassment isn’t developed by mid-2024, legislative actions may be taken. Local key players include Bumble and Match Group, who owns both Tinder and Hinge.

SIZZLIN’ SEZZLE: Sezzle shareholders cheered on Tuesday when the company’s share price rose over 20% at open. While gains have since reversed in line with broader market weakness, investors would still be pleased with the company’s strong income levels reported for August.

And that wraps up this week’s Spotlight. Hope it brought you a lot of insights!

Next week, all eyes will be on the release of the latest AU inflation data. Mark your calendars for Wednesday.