Market outlook: ASX performance expectations vary

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That's it for another day on the blog, thanks for your company.

Looking ahead, the signs are promising for Wall Street's session tonight.

We'll be back early tomorrow with all the news from overnight and then roll on throughout the day with news and analysis from the world of business, finance and economics.

If you need a finance fix before then, don't forgot our excellent Business Daily Podcast or our equally excellent The Business broadcast Mondays to Thursdays 8:44pm on ABC News Channel, after the Late News on ABC TV, and anytime on ABC iView.

Until next time, missing you already...

The ASX 200 wobbled around between marginal gains and marginal losses over the day and ended up going nowhere.

At the close, the key indices were mixed:

The financial sector led the way while there has been a sell off among the miners despite higher iron ore and copper prices on Friday.

The banks, now in full agreement about the RBA raising rates next week, were also in lock step on the market. ANZ gained 0.9%.

The healthcare sector was also stronger despite Telix Pharmaceuticals sliding almost 12% after announcing a $2.3 billion takeover of a German isotope maker.

Heavyweight Cochlear gained 5.3% despite going ex-dividend today, while CSL (+1.5%) was also in demand.

The retailers were mixed. JB HiFi gained 1.6%, while both Coles (-0.7%) and Woolworths (-0.3%) slipped.

Despite the Nasdaq rally on Friday, ASX tech players had a tougher session.

Accounting software supplier Xero fell 4.3% while Telstra has shed 0.5%.

The miners were generally lower with Rio Tinto down 0.8%. Newmont (-2%) and North Star (-1.1%) were sold off on a falling gold spot price,

Top mover on the ASX 200 was gold miner Ramelius Resources (+6.2%) after announcing a major upgrade in production output.

Bottom mover on the ASX 200 was Perpetual (-15.1%) after rejecting a marginally improved takeover offer from Swedish private equity group EQT.

On the ageing population, Treasurer Chalmers said for the first time in an IGR, deaths are projected to outnumber births by the 2060s.

That will have huge implications for our population and economy.

"Fewer births mean much lower increases in Australians aged under 20 - growing just 10.4 per cent to the early 2060s, compared to almost 28 per cent forecast in 2023," he said.

"This will contribute to slower population growth, averaging 0.9 per cent annually – 0.2 percentage points lower than 2023, and a third lower than the last 40 years.

"The number of Australians over 85 will triple by 2066 – putting further demand on health services."

On the industrial transformation, he said Australia was well placed to benefit from the rising demand for commodities.

"The IGR shows our advantages of the 2010s – Chinese commodity demand, education and tourism will shift towards new advantages in renewables and critical minerals, strong institutions and strategic partnerships, and AI-enabled services.

An ageing population will increase demand for the care economy and AI will unlock new business models, accelerating the shift towards services spurred further by rising household incomes."

And on geopolitical fragmentation, he said the world had experienced a major deterioration since the 2022 IGR, with more conflicts, over 18,000 discriminatory trade measures being introduced since 2020, and foreign investment becoming more and more a matter of geopolitical interest.

But while trade is restructuring, it’s still growing, he said.

Global trade as a percentage of GDP reached 68 per cent in 2025, an all-time high.

This does not mean we can be complacent about rising protectionism – there will be long-term costs and consequences from the rise in trade barriers we’ve seen.

But the changing shape of trade does provide opportunities for Australia to set ourselves apart as a more trusted partner and more reliable exporter," he said.

Just a quick peek at the rundown for The Business with Kirsten Aiken tonight.

That's The Business broadcast Mondays to Thursdays 8:44pm on ABC News Channel, after the Late News on ABC TV, and anytime on ABC iView.

Treasurer Chalmers then discussed the five "accelerating shifts" that Australia will have to navigate in coming decades:

On AI, he said Australia was adopting AI at a higher rate than almost every G20 country, and it could lead to a productivity boost. But he was also aware of the risks.

"AI offers a lot of upside, but also very serious risks to minimise and manage," he said.

"We already see dangerous proliferation of misinformation, scams and malicious cyber operations.

"We are vigilant about managing the infrastructure build’s impacts on our resources and communities, and risks of market concentration, social harm and economic disruption."

On the energy transition, he said the AI resolution will have major implications for what we're trying to achieve with the transition.

"It will add to demand for electricity and the infrastructure that supports it," he said.

But he said that needed to be accommodated.

"The IGR shows a disorderly energy transition would be disastrous for our economy and also our environment," he said.

"Inaction also means disaster recovery spending around 25 percentage points higher in 2066 if temperatures exceed 3 degrees of warming."

Monday's blog wouldn't feel complete without a look at what happened in home auctions over the weekend.

Spring has seen a burst of new properties up for sale — nationally volumes were up 16% on the week before — but the clearance rate fell after two consecutive weekends of rises.

The property research house, Cotality, said the overall clearance rate of 54% coincided with deteriorating interest rate expectations prior to the Reserve Bank's monetary policy board meeting on 29 September.

"Despite the decrease, auction markets remained above the winter average of a 52.3% preliminary clearance rate," Cotality noted.

"Melbourne held 900 auctions, almost half (49%) of all capital city auctions, up 26.8% from the previous week.

"Its preliminary clearance rate slumped 7.0 percentage points to 56.3%, the weakest in three weeks. Auction volumes are set to fall sharply this week, with around 280 currently scheduled because of the AFL Grand Final long weekend.

"Across Sydney, 577 homes went to auction, a 5.3% rise in auction volumes on the week, though that was 36.9% fewer than a year ago. Auction activity is expected to rise sharply this week, with about 935 homes currently scheduled to go under the hammer," Cotality said.

Treasurer Jim Chalmers spoke at the Australian National University (ANU) a little earlier about the latest intergenerational report (IGR), which was released today.

The first IGR was released in 2002 by Treasurer Peter Costello, and they have been released every five years (roughly) since then in 2007, 2010, 2015, 2021, 2023, and 2026.

IGRs look deep into the future, with forecasts of major trends that stretch out for 40 years. They are an intellectual exercise, designed to focus everyone's attention on the path that Australia's economy is currently travelling and where we're likely to end up if we don't course-correct at some point.

Near the beginning of his speech, Chalmers said this:

"The world is becoming more dangerous, more unpredictable, more unequal, and more divided [...]

"Accelerating change is putting more pressure on people. It’s eroding trust in the institutions of our democracy. It’s exacerbating the strain felt by younger generations in particular. The division in politics now is not between those who accept this and those who don’t. But between those who prey on it and pick at it and politicise it and catastrophise it – and those who seek to alleviate it."

And then he spoke of the ways in which he's hoping that Australia can benefit from the major changes that are occurring in the global economy.

He said the future will depend on how we respond to five accelerating shifts in AI, energy, demography, industry and geopolitics.

And he said the "AI revolution" was "the most consequential new emphasis since the 2023 report, and the biggest economic transformation of our lifetime."

"The productivity, investment and labour market impacts of AI will be dramatic," he said,

AI will play a pivotal role in reaching long-term productivity growth of 1.2 per cent, and higher if productivity gains accelerate over time."

There's been a flurry of activity among the economic teams at the Big Four retail banks with Westpac on Friday and CBA and ANZ today all joining NAB's call for a rate hike at the RBA's meeting next week.

ANZ took it one step further, leaving its call for a November hike in place while adding the September hike for good measure.

Intrepid podcaster Carrington Clarke and Michael Janda discuss the changes in stance at the banks, as well what's happening in the oil and housing markets. Bit of ground to cover there, but well worth your while.

G'day ABC, can you help me understand how higher bond yields are bad for equities, ai keep hearing it but can't make the connection much. It seems like its bad for valuations due to the risk free bond. But how do equities actually get affected? Is it just higher borrowing costs, seems thats more a central bank mechanic. Any help please would be great.

Good question Bond Fan.

Most fundamentally, it comes down to the way analysts and fund managers value shares in the present based on their discounted future cash flows.

Meghan Shue, the chief investment strategist at US financial services firm Wilmington Trust, explained it well in this note written in 2019.

"First, the current price of a stock is simply the present value of the sum of all future cash flows (earnings plus buybacks plus dividends)," she wrote.

"Interest rates are directly linked to the cost of capital, or the rate used to discount those future cash flows (earnings plus buybacks plus dividends) of a stock or index.

"The lower that discount rate (in the denominator), all else being equal, the higher the present value of any future payouts (those payouts are in the numerator) and the higher the stock price."

Relatedly, lower interest rates also reduce the "opportunity cost" of owning more speculative stocks that don't currently generate an income stream.

"Second, as interest rates move lower, the relative appeal of other income-generating assets—including stocks—increases, even if they carry extra risk over a traditional bond," she explains.

"As interest rates fall, it lowers the 'income opportunity cost' of investing in stocks over bonds."

Meghan Shue goes on to note that, historically, rising interest rates have generally coincided with rising share prices.

"Most of the time rising rates are good for stocks because the increase in earnings growth expectations—which typically goes along with that increase in rates—tends to overwhelm the higher discount rate (with one exception being a stagflationary scenario of rising inflation and slowing growth)."

Unfortunately, the latter is the scenario many economists are concerned about for Australia and many other advanced economies.

One of Australia's bigger IPOs in recent years is likely to be launched in early October with data centre operator Firmus set make its initial public offering to raise $7 billion to institutional investors on October 6, according to a term sheet reviewed by Reuters.

The company's shares will start trading on the Australian Securities Exchange on October 22, the term sheet said.

Firmus did not immediately respond to Reuters' request for comment.

While large by Australian standards, it is still dwarfed by last year's blockbuster $27 billion raising for Sigma Pharmaceuticals, home of the Chemist Warehouse chain.

Overall, there has been a stronger flow of ASX listings recently with around 100 new entities listed in FY26 compared to 69 in FY25.

Here's a deep dive into Firmus by investigative reporters Paddy Manning and Ashleigh Barraclough.

The latest iteration of Australia's Intergenerational Report shows that while living standards are expected to continue to rise, many acute challenges will remain — such as entering the housing market.

As a society our fertility rate will slip and the population will age, putting more pressure on the Federal budget.

The ABC's chief digital political correspondent Clare Armstrong has waded through the hefty tome and here's what she found.

ASIC is suing former Super Cheap Retail CEO Anthony Heraghty over allegations he failed to disclose and manage conflicts of interest arising from an alleged undisclosed relationship he had with a senior executive at the company.

The legal action centres on allegations that Mr Heraghty;

Mr Heraghty was fired from Super Cheap Retail in September last year after news of an alleged relationship with the company's former head of human resources emerged.

He has since taken up a post leading kitchen appliance outfit Winning Group ahead of a potential ASX float next year.

ASIC Chair Sarah Court said governance and directors' duties failures and misconduct damaging market integrity are enduring enforcement priorities for ASIC.

"ASIC alleges Mr Heraghty put himself in a position where his personal interests conflicted with his duties to Super Retail Group and that he failed to properly disclose and manage that conflict," Ms Court said.

"The allegations in this matter raise important issues about governance, transparency and trust in the information provided to boards and the market.

"This case is not about private relationships, but whether a director properly disclosed and managed conflicts of interest and met their duties to the company and shareholders.

ASIC alleges Mr Heraghty alleged actions exposed Super Retail Group to foreseeable risks of harm, including risks to its corporate reputation, complaints and litigation, regulatory action, costs, and harm to its share price and shareholders.

Super Retail Group houses a number of high-profile retail outlets including Supercheap Auto, BCF, Rebel and Macpac.

Breaches of directors' duties can attract penalties of up to $1,565,000 per breach, while providing misleading information to a company board also attracts a maximum penalty of $1,565,000 per breach.

The current immigration debate sparks all sort of reactions, but in the tertiary education sector there is one common emotion - despair.

Our one-person economic think tank Alan Kohler takes a look at why universities are united by the same problem of a lower immigration target.

Prices current at around 1:20pm AEST

The ASX has wobbled around between marginal gains and marginal losses so far.

At the time of writing (1pm AEST), most key indices were marginally lower.

The financial sector is leading the way while there has been a sell off among the miners despite higher iron ore and copper prices on Friday.

The banks, now in full agreement about the RBA raising rate next week, were also in lock step on the market. ANZ and NAB are both up around 0.8%.

The healthcare sector was also stronger despite Telix Pharmaceuticals sliding almost 6% after announcing a $2.3 billion takeover of a German isotope maker.

Heavyweight Cochlear is up 3.4% today despite going ex-dividend, while CSL (+1.2%) has also made a solid gain.

The retailers are mixed with once again non-discretionary retail outpacing the discretionary side of the aisle, although JB HiFi is up almost 2%,

Despite the Nasdaq rally on Friday, ASX tech and telco players are having a tougher session.

Accounting software supplier Xero is down almost 4% while Telstra has shed 0.5%

The miners are generally lower with Rio Tinto down 1%. Newmont (-1.7%) and North Star (-1%) are down on a falling gold spot price,

Top mover on the ASX 200 is gold miner Ramelius Resources (+6.2%) after announcing a major upgrade in production output.

Bottom mover on the ASX 200 is Perpetual (-14%) after rejecting a marginally improved takeover offer from Swedish private equity group EQT.

Two hours in and the ASX 200 has clawed back its earlier losses to be trading sideways at midday (AEST).

The ASX 200 was down just 2 points, or 0.02%, to 8,729 points.

It's not been a happy morning for international raiders hoping to snap up a couple of ASX-listed business.

Financial services group Perpetual has again given Swedish private equiteers EQT a firm "nej" (no) to a marginally revised $2.6 billion takeover offer.

While the US-based Warburg Pincus was told the same thing by property developer Ingenia Communities for its $2.9 billion bid.

Perpetual has tumbled 14% while Ingenia has gained 2%.

It mightn't seem like it sometimes, but the Monday Blog is constantly sniffing around for some good news.

Well, here's today's offering, courtesy of the soon-to-be-released Intergenerational Report (IGR) and Treasury.

"Australians have one of the longest life expectancies in the world. Life expectancy is projected to reach 89.5 years for women and 86.1 years for men by 2065–66," the IG report noted.

"Medical advances, better access to health care and rising living standards have helped Australians live longer. Longer life expectancy contributes to an ageing population, with younger cohorts living longer than earlier ones. Higher quality healthcare treatment and prevention are expected to see further long-run declines in mortality rates.

"Most countries are expected to see further gains in life expectancy, although these gains are likely to moderate, particularly for high-income countries," the report notes.

Federal Treasurer Jim Chalmers is set to release the latest edition of the Intergenerational Report (IGR) at 12:30pm in Canberra.

We'll have Gareth Hutchens blogging away for us, but before then some snippets have been released.

Since the last IGR in 2023, population growth forecasts have been wound back a bit.

"Australia's population growth is projected to slow from an average of 1.4 per cent a year over the past 40 years to 0.9 per cent a year over the next 40 years. This is 0.2 percentage points lower growth compared with the projection period of the 2023 IGR," Treasury noted.