AUSTRALIA DATA: Weak Equipment Capex Drives Q1 Investment Lower
Q1 private capital expenditure volumes were weaker than expected falling 0.1% q/q to be down 0.5% y/y driven by a contraction in machinery & equipment investment. Q4 was revised up to +0.2% q/q, there appears to be a trend of upward revisions to the previous quarter as was also the case with construction. Q1 GDP prints on June 4 with the inventory and net export components released on June 3, but currently it is looking soft.
- Q1 building & structures investment rose 0.9% q/q, third consecutive quarterly increase, to be up 0.6% y/y after falling 0.2% y/y. It was driven by mining projects in oil & gas, gold, and other metal ores with capex up 1.7% q/q while non-mining was +0.4%.
- Plant & equipment fell 1.3% q/q after -0.6%q/q to be down 1.8% y/y after rising 2.3% y/y in Q4. The weakness was due to the non-mining sector (-2.0% q/q), while mining rose 2.4% q/q. In terms of non-mining, the ABS notes that services invested in less IT and vehicles.
- Investment intentions for FY25 were revised up 2.2% and for FY26 +5.6%.
Australia capex building & structures %
Source: MNI - Market News/ABS
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
CHINA: Bond Futures Rally on Liquidity Injection
- This morning’s OMO saw a sizeable liquidity injection and unsurprisingly bonds are rallying.
- China’s 10YR bond future is up +0.185 to 109.04 and remains firmly above all major moving averages, the nearest being the 20-day EMA of 108.73
- The 2YR bond future is up just +0.03 at 102.36 and remains below all major moving averages, the nearest being the 20-day EMA at 102.43.
- The cash market is strong also with the CGB 10yr down -1bp this morning at 1.63% with the Hang Seng and Shenzhen bourses higher whilst the CSI 300 is down marginally
CANADA: Networks Calling Election For Carney, Too Soon To Know If Majority
With results now coming in from Canada’s more populous provinces CBC and CTV are calling that Mark Carney will stay PM but it is still too early to say whether his Liberals will have a majority. There has been little change of seats between parties so far. Elections Canada currently has the Liberals leading in 133 districts (50.0% vote share), Conservatives in 93 (38.7%), Bloc Quebecois in 17 (4.8%) and New Democrat in 3 (4.4%). 172 seats are needed to form a majority government.
CHINA PRESS: A-share Market To Be Supported - Analyst
Authorities' support for the A-share market together with China’s low interest rate environment could drive up stock prices in the long run, said Wu Zhaoyin, chief investment officer at Soochow Futures. In the near term, major indexes may fluctuate as firms release annual and quarterly reports, and U.S. tariffs could be adjusted during the May 1-5 holiday period when the exchanges are closed, said Wu, noting impacts can be controlled.
