Firetrail Weekly | Insights from the Trail
In Australia, GDP rose 1.0% versus the year prior, in-line with expectations. That was the weakest reading since the recession of 1991. Two things are keeping the numbers positive – immigration and Government spend. On a per capita basis, that marks six quarters of decline.
In US, data was generally weaker. Job openings missed expectations and printed the lowest reading since January 2021. The ISM manufacturing survey showed a decline in new orders, further bolstering the case for a September rate cut. Election news, the polls are favouring Harris, while the betting markets are suggesting 50/50.
![Source: Bloomberg](https://www.livewiremarkets.com/rails/active_storage/blobs/proxy/eyJfcmFpbHMiOnsibWVzc2FnZSI6IkJBaHBBMFQ1Q3c9PSIsImV4cCI6bnVsbCwicHVyIjoiYmxvYl9pZCJ9fQ==--b5c6f5afac8cde9281c730100ff0063393982261/download.png)
1. No Deal – Japan unwelcome in US steel M&A
This week the deal looks much less likely. Speaking at a Labor Day event, Kamala Harris explained that "U.S. Steel is a historic American company, and it is vital for our nation to maintain strong American steel companies." She added, "I couldn't agree more with President Biden, U.S. Steel should remain American owned and American operated". Trump also opposes the merger.
![U.S. Steel Price - Source: Bloomberg](https://www.livewiremarkets.com/rails/active_storage/blobs/proxy/eyJfcmFpbHMiOnsibWVzc2FnZSI6IkJBaHBBMG41Q3c9PSIsImV4cCI6bnVsbCwicHVyIjoiYmxvYl9pZCJ9fQ==--e76eb6a3b7fa35d51104f17e553280837b7c1e25/download%20(1).png)
- Hospitals looking a bit sick
- More day surgery, less overnight stays – more rehab is being undertaken at home;
- Higher out of pocket payments – with cost of living pressure, there is less elective surgery happening due to high out of pocket;
- Public shift – we are anecdotally hearing more maternity is shifting to public due to a reasonable offering.
This week Australian Health Minister Mark Butler ruled out a taxpayer-funded bail out. Private hospitals want the insurers to help.
A situation to watch...
![Ramsay Healthcare share price - Source: Bloomberg](https://www.livewiremarkets.com/rails/active_storage/blobs/proxy/eyJfcmFpbHMiOnsibWVzc2FnZSI6IkJBaHBBMHI1Q3c9PSIsImV4cCI6bnVsbCwicHVyIjoiYmxvYl9pZCJ9fQ==--97d97afb7e49934dd16ecfa7aea8372b0e16e95c/download%20(2).png)
- Volvo hits reverse
Interestingly, hybrid cars generally use 70% less lithium compared with electric only. Piling on the pain for lithium producers.
![Volvo EX30 – fully electric SUV - Source: Volvo](https://www.livewiremarkets.com/rails/active_storage/blobs/proxy/eyJfcmFpbHMiOnsibWVzc2FnZSI6IkJBaHBBMHY1Q3c9PSIsImV4cCI6bnVsbCwicHVyIjoiYmxvYl9pZCJ9fQ==--73b01436abfd0056db44a3d72c038d6a25ca2508/download%20(3).png)
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Anthony Doyle is Head of Investment Strategy for the Firetrail S3 Global Opportunities Fund. His primary responsibilities include fundamental idea generation, portfolio analysis, and economic insights including currency and macroeconomic risk...
Expertise
Anthony Doyle is Head of Investment Strategy for the Firetrail S3 Global Opportunities Fund. His primary responsibilities include fundamental idea generation, portfolio analysis, and economic insights including currency and macroeconomic risk...