Australia’s labour market showed unexpected strength in May, with employment jumping by 40,300, leading to a fall in the jobless rate to 4.4 per cent. This robust data provided a mid-day lift to the Australian Securities Exchange (ASX), which trimmed its intraday losses. However, the Australian dollar remained below US69 cents, reflecting broader market cautiousness. Prime Minister Anthony Albanese weighed in on the evolving nature of work, noting that artificial intelligence means not every job can be protected, as technology continues its advance.
Amidst these economic shifts, specific financial institutions are facing headwinds. Judo Bank, a challenger bank focused on providing tailored financial services to small and medium-sized businesses across Australia, issued a warning on provisions, signalling increased loan losses. Its share price tanked significantly as these provisions revealed strains within the economy, raising concerns about how multiple loans across different sectors and states could deteriorate concurrently. This comes as a new “big short” is reportedly being mounted against the private credit sector, highlighting growing investor scrutiny.
Adding to the mixed economic signals, engineering firm Worley cut its profit guidance, indicating challenges in its operational outlook. In a significant infrastructure development, the boom in battery installations has dramatically reshaped Australia’s power grid blueprint, halving the projected need for expensive new poles and wire projects out to 2050, according to the grid operator. Meanwhile, in the technology sector, artificial intelligence company Anthropic has accused Chinese e-commerce giant Alibaba of industrial-scale theft, alleging the use of swarms of fake accounts to illicitly extract chatbot capabilities.
