Friday , October 22 2021

Inventories fall again when wage increases result in mass sales


The Australian stock market has lost its value today, as falling oil prices, weak Chinese loan data, profit cuts and domestic crisis-related problems have caused profit to rise in two weeks.

The S & P-ASX 200 index has opened by 0.2 percent. Less, but sales accelerated in the middle of the session, because more stable domestic wages signaled that there would be no relief for falling home prices to the east from a reduction in interest rates by the Reserve Bank.

The comparative index dropped very strongly in the second half, and all quick rebound attempts reversed quickly and closed 101 down points, or 1.74 percent at 5732.8 with energy reserves, miners, major banks and losses leading up.

Last night, the S & P 500 index in the US lost 0.2%. And the markets found some support for the hope of a trade agreement between the US and China, but a 7 percent decline in oil prices underlined the rapid loss of growth in the domestic market.

Data on Chinese foreign loans deepened negative sentiment, as Chinese banks halved new loans last month, while total social financing fell by two-thirds to 728 billion yuan from 2.2 trillion yuan.

Australian banks were under pressure from a report by UBS analysts who warned that the growing credit crunch in the country could cause "economic downturns" depending on the scope of the Hayne Commission's recommendations in the financial sector.

UBS bank analysts, who said they believe the housing market is deteriorating, were a signal of even more difficult times.

"The credit market in the real estate market has grown over the last six months, and now the number of mortgages held by the owner (" flow ") is also falling.

However, the Australian dollar reached USD 72.20, and the increase in wage prices increased to 2.3%, which made the Reserve Bank difficult to justify a reduction in interest rates in the coming months.

AMP investment strategy chief Shane Oliver said wage increases, including bonuses, accelerated to 2.7 percent year-on-year in the September quarter "suggesting that companies may prefer higher bonuses when they can rather than significantly raise basic wages – especially in the private sector, sector ".

George Tharenou, UBS economist, pointed out that most of the salary increase was directed by the health and education sector "dominated by society" by 2.8% and 2.7% respectively.

He said: "In general, wages are increasing, but only gradually, as expected, from 2.3% year on year, still soft", despite the highest increase in minimum wages in eight years, as well as a tightening labor market with strong employment and unemployment is falling to the level of "unstoppable inflation rate" at 5%.

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