1. The Nasdaq closed at a record high Wednesday as multiple tech stocks rose to fresh peaks, managing to shake off mounting trade tensions that have weighed on global markets this week. That saw the US hold close to its best level in 11 months, which kept pressure on the Aussie as AUD/USD declined for the sixth straight session. US 10-year bond yields rose back above 2.9% as US Fed Chair Jerome Powell said the case for further rate hikes remains strong at the Sintra conference in Portugal.
2. RBA Governor Philip Lowe says the biggest domestic risk facing the Australian economy is not persistently low inflation but rather household debt levels. Speaking at the ECB forum in Portugal, Lowe said: “I remain confident we’re going to get back to 2.5%, it’s just going to take us a bit of time,” referring to the midpoint of the RBA’s 2-3% inflation target. That’s a big hint that Lowe believes a further reduction in the cash rate could well deliver more harm than good, at least in the medium-to-long term.
3. Finally, US President Donald Trump has signed an executive order to stop separating families at the border. It’s a small relief for 2,000-plus migrant children who have recently been separated from their parents and put in cages. Despite the EO, Trump has maintained the “zero-tolerance” policy that criminally prosecutes migrants who cross the border illegally. Now, families who cross the border will be detained together. It’s still unclear what will happen to the families that have already been separated.
4. Victory for Turnbull. One Nation’s Pauline Hanson has saidshe will support the government’s $144 billion income tax cut package. The agreement will see the government push to have the package voted on in both houses of parliament today. It’s insisting on an “all or nothing” vote to enact a seven-year package that starts with cuts for 10 million workers on July 1. Hanson’s support is a blow to the Labor party, which has been staunchly opposed to the tax plans.
5. Hundreds of Toys ‘R’ Us staff will be out of a job in the coming weeks as the giant toy retailer prepares to close its 44 Australian stores. Administrators were appointed to the Australian business in May, two months after its US parent collapsed spectacularly in March. While there were hopes the bankrupt retailer’s local operations could be merged with its Asian business and sold to a new owner, a deal failed to eventuate.
6. Amazon’s Prime launch in Australia is more aggressive than anyone expected. The US tech giant rolled out its subscription service to the Australian market this week, promising free two-day delivery. The announcement caught some by surprise, with many in the retail industry expecting a launch later this year. At $59 a year, Prime is cheaper in Australia than other developed markets. Morgan Stanley analysts say the low price “shows Amazon’s high long-term aspirations for Australia”. More here.
7. Tesla is suing the employee Elon Musk claimed committed sabotage against the company. The US carmaker has filed a lawsuit against the employee, alleging they “unlawfully hacked the company’s confidential and trade secret information and transferred that information to third parties”. On Monday, Musk said an employee had changed parts of Tesla’s manufacturing operating system code and sent “highly sensitive” company data to outside parties.
8. May the force be with you. Masayoshi Son, the SoftBank CEO with $US100 billion to blow, likes to quote Yoda and “feel the force” when picking deals. An unusual approach for the leader who is ultimately in charge of the biggest startup investment fund in the world.
9. Belgium is on top of the 2018 World Cup power rankings after one week at Russia. While many World Cup favourites were disappointing in their opening matches, leaving with a loss or draw against subpar opponents, Belgium took care of business with confidence, beating Panama 3-0. Australia is sitting at number 26 of 32 after losing to France 2-1. Tonight, the Socceroos will play Denmark (ranked 14), but the odds aren’t in our favour with just a 16% chance of winning. Here’s a look at the rankings in full. And get excited, because Optus announced yesterday afternoon that SBS will screen group round matches on free-to-air TV until the end of next week as the telco tries to make amends for problems with its streaming of the opening matches on the weekend. Yippee!
10. Roger Federer just paid Nick Kyrgios the ultimate compliment.
Speaking to Tennis World USA, Federer said: “I’d rather not play five-set matches against Nick because they would last too long and we would probably both grow beards before the end… I’m a fan, really. He plays very relaxedly, just like me when I was young.” The champs have recently put rivalry aside in favour of an unlikely friendship. Here’s a flashback for you.
BONUS ITEM: Rockets are big — really big.
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