Good Evening,

Welcome to Equity Espresso

We’re here to catch you up on all the day’s news in Australia and abroad.

Here’s a sample of what you may have missed today:

1. 👷‍♂️ Chevron Workers Delay Strike

2. 📜 PayPal’s ‘Unfair’ Contract Terms

3. 📱 China Says 'No' to iPhones

4. 🧱 The Great Wall’s Hole

5. 🚪 RBA Governor Exits

The Recap

ASX Falls on U.S. Rate Fears & Slowing China Economy

The ASX200 fell by 86.1 pts. as Australia’s largest company, BHP Group, traded ex-dividend, putting downward pressure on the market. Over 30 companies traded ex-div. today, with many more still to come this month, as September is historically a negative month for the ASX200:

So far, after five trading days in September, the ASX200 is down 2.11%.

Chalice Mining (+7.9%) was one of the few winners on the market, regaining some ground after shedding 44% in the last month.

One of the other winners was Liontown Resources (+9.0%), with the AFRs Street Talk highlighting some unusual trading activity this morning, with WA stockbroker Euroz Hartleys trading around 1.7% of the company stock. Volumes increased to 85.6 million from 15 million on Wednesday. The article speculates that this could point to Gina Rinehart - who owns a 4.9% stake in the company.

All 11 sectors finished lower, with Materials (-3.2%) and Energy (1.5%) dropping the most.

Philip Lowe had his final speech as governor today. The outgoing governor said that the government should hand over some of its taxing and spending powers to an independent body to reduce the reliance on the Reserve Bank in managing the economy. He also proposed the creation of an independent body to be given limited powers over fiscal policy to improve the coordination between the central bank and the government.

Gas prices fell overnight after workers at Chevron’s liquefied natural gas facilities had agreed to pause planned strike action for one day. According to two anonymous union representatives, the workers at Chevron’s LNG facilities would delay strike action until 6 p.m. AWST Friday.

ASX200 Stock Snapshot

Wall Street

U.S. markets declined on Wednesday, with the S&P500 (-0.7%) falling for the second consecutive day, while the Nasdaq fell by 1.06%. This followed data from the the Institute for Supply Management’s (ISM) U.S. services index, which in August reached 54.5, its highest monthly reading since February. This read beat consensus estimates of 52.7. A reading above 50 represents growth in the sector, raising fears of potential further rate hikes.

The more prominent tech players finished lower, including Tesla (-1.8%), Amazon (-1.4%) and Nvidia (-3.1%). Apple (-3.6%) experienced its largest decline in a month after Chinese government agencies prohibited employees from using foreign-branded devices such as the iPhone at work.

Economic News

Australia’s trade surplus shrank more than expected in July to A$8.04 billion from A$11.32 billion in June, as weak demand in China weighed on critical metals and commodities exports. The read came in weaker than expected, estimated at A$10.0 billion, and was also at its lowest level since February 2022.

The latest trade data from China for July revealed a decline in imports and exports, which was worse than expected. This decline indicates a drop in demand both domestically and overseas.

However, a few categories of exports showed a significant increase in value in the first seven months of the year, such as cars and suitcases. China reported on Tuesday that its exports fell by 14.5% in July compared to last year, while imports decreased by 12.4% in U.S. dollars.

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Quick Singles

🪃 Local News

• ASIC is suing Paypal Australia over claims that their standard form contracts with small business customers contain an unfair contract term. Specifically, the PayPal business account gives holders a 60-day window to notify PayPal of any errors or discrepancies in fees charged; otherwise, the fees are assumed to be accurate.

• Auidnate went into a trading halt today as it aims to raise $70million in a retail and institutional placement at a share price of $13.00

• Perenti Limited has announced that its African Mining Services surface business has been awarded a contract for open pit mining services at the Motheo Copper Mine in Ghanzi, Botswana. The agreement, valued at US$235 million (~A$360 million), will be in effect for 73 months.

• Bubs Australia has started a nationwide enrolment for its Growth Monitoring Study (GMS) clinical trial. The purpose of the study is to assess the growth, tolerance, and safety of new infant formulas as a standard aspect of the U.S. regulatory process

🌏 Around The Globe

• Starting October 1, Spotify will restrict white noise podcasts from its Ambassador Ads program, as they are intended for background noise and not active listening.

• Qualcomm will supply chips to power in-car infotainment systems for luxury automakers Mercedes and BMW.

• Tesla has filed a lawsuit against a Chinese company for unfair competition and infringement of technology secrets, reported Shanghai Securities Journal on Tuesday.

• Meta’s return-to-office mandate went into effect Tuesday, requiring employees to work from the company’s physical locations at least three days a week.

₿ Crypto Corner

• Marathon Digital Holdings, a publicly traded Bitcoin mining company, reported a 9% decrease in Bitcoin production in August 2023. The company has attributed the decline in output to temporary shutdowns of mining operations in Texas due to extreme heat conditions.

Markets

Index & Commodity Prices

Bond Prices

ASX By Sector

ETF Watch

Movers and Shakers

✅ Biggest Gainers

Shipbuilder Austal (ASB) announced it had been awarded a $US91 million ($143.4 million) contract for the construction of three Landing Craft Utility (LCU) 1700 class vessels for the U.S. Navy.

This follows a previous contract for the detailed design of the vessels and includes options for manufacturing an additional nine vessels and associated support arrangements.

Austal Limited Chief Executive Officer Paddy Gregg said, “The new contract reinforces Austal USA’s position as a critical capability partner to the United States Navy and further diversifies the company’s steel shipbuilding portfolio.” Austral finished the day 3.2% higher to $1.91.

Red 5's (RED) share price rose 4.1% after it reported updated mineral resources of 6.2 million ounces (Moz) and ore reserves of 2.6Moz as of June 30.

The company’s King of the Hills (KOTH) project saw a significant resource boost, with a 185% rise in open pit resources and a 102% growth in underground resources. In 2023, extensive drilling was done at KOTH, emphasising grade control and resource conversion.

🔻Biggest Fallers

No significant news pushed companies lower other than the large number that traded ex-dividend today. Some of these companies included BHP (-5.2%), McMillan Shakespeare (-5.9%), Super Retail Group (-7.6%) and Michael Hill International (-6.5%).

Check out our dividend section further below to get the complete list of companies.

Chart of The Day

Veganism Popularity Fading?

According to new data from Gallup's Consumption Habits poll, the number of strict vegans and vegetarians in the U.S. has been trending in the opposite direction in the last four years.

Although there does seem to be continued momentum around temporary dietary changes, with “Meatless Mondays” and “Veganuary.”

Meanwhile, some countries are going a step further.

France’s agriculture ministry said it plans to ban the use of 21 meat terms — including “steak,” “ham,” and “fillet” from labels on all plant-based food products.

What The?

Taking Shortcuts: The Great Wall's Unexpected Renovation

The Great Wall of China was tampered with by individuals who utilised an excavator to create a gap in the wall, which they deemed necessary for their construction work to proceed smoothly.

The DIY project occurred near the 32nd Great Wall in Youtu County, a section dating back to the Ming Dynasty. While the duo might have thought they were onto something groundbreaking (literally), the police didn't quite see it that way. The two were promptly detained after officers were tipped off about the new "doorway" on August 24.

While some parts of the wall are in pristine condition, others are mere mounds of earth. This incident, though shocking, isn't entirely out of the blue.

The Great Wall has stood tall for over 2,000 years, spanning over 4,000 miles. However, it has faced various challenges, such as natural degradation and locals taking bricks for their projects. Recently, a renovation project caused concern as the wall has already faced climate change and overenthusiastic tourists leaving their engravings.

Daily Quiz

Test Your Knowledge

Aussie Sports teams

Yesterday’s Daily Quiz Question: What kind of business was Berkshire Hathaway when Warren Buffet bought it in 1965?

Answer: Textile Manufacturer. Well done to the 45% of people who got this one correct.

Berkshire was founded in 1839 as a textile manufacturer. Warren Buffet bought a stake in the company in 1962 before buying it outright in 1965, transforming it into a holding company with a portfolio of successful businesses.

A Little Extra

📉 Going Down?

Top 10 shorted stocks on the ASX - as of September 1

1. Flight Centre (FLT) - 10.33%

2. Pilbara Resources (PLS) - 9.81%

3. Syrah Resources (SYR) - 9.04%

4. Elders Limited (ELD) - 8.99%

5. IDP Education (IEL) - 8.16%

6. Brainchip (BRN) - 7.73%

7. Appen (APX) - 7.42%

8. Mesoblast (MSB) - 7.40%

9. Core Lithium (CXO) - 7.32%

10. JB Hi-Fi (JBH) - 7.31%

📊Broker Ratings

What do the brokers have to say?

1. Chalice Mining (CHN) - Upgraded to Neutral from Sell (UBS). Target Price $3.50

2. Orora (ORA) - Downgraded to Hold from Add (Morgans). Target Price $3.00

👨‍💼 Director Transactions

What are the insiders doing? (On-market and off-market trades only)

💲Dividends

Companies trading ex-dividend today

📅 Economic Calendar

Data to keep an eye on this week

Reader Review

DISCLAIMER: None of the information provided in this newsletter should be constituted as financial advice. This newsletter is strictly for educational purposes only. It should not be taken as investment advice or a solicitation to buy or sell assets or make financial decisions. Please do your research.