ACCC warns of big box retailers getting ‘significant market power’
The consumer watchdog’s submission to a Senate inquiry into big box retailers like Bunnings, Petstock and Ikea has just been published.
Its submission starts with this comment:
‘Big box’ retailers, which include those operating in the hardware and broader retailing
markets, may acquire significant market power by leveraging their large-scale operations and
extensive supplier networks.
The submission notes the range of tools the ACCC holds to help competition but reiterates issues around merger powers.
The current merger review regime in Australia is a voluntary and informal one, meaning firms
are not required to notify the ACCC or seek its approval before proceeding with an acquisition,
even where certain market shares or market capitalisation levels are met.
The ACCC has previously noted issues with mergers when it was involved in Woolworths’ acquisition of Petstock.
The ACCC’s submission to the Senate inquiry doesn’t mention Petstock by name.
ASX opens lower as Middle East crisis continues
The benchmark ASX 200 has opened 0.4% lower.
The bottom performing stock is Mexican food retail chain Guzman Y Gomez which only recently debuted on the ASX.
It’s off 2.6%.
Any stocks you’d like looked at today? Hit us up in the comments.
How higher power bills are hurting businesses
Last week dairy producer Beston Global Food Company cited onerous energy prices as one key reason for entering administration. 160 jobs are on the line.
Smaller businesses are also feeling the impact of power bills, with them pushing up prices for consumers as a result.
ABC’s 7:30 looked into this issue.
How Iran’s attack on Israel is impacting oil prices
The global price of oil was already creeping higher.
Now it has surged after Iran launched a barrage of missiles at Israel earlier this morning.
The ABC’s Peter Ryan looked further at this developing issue.
Will China’s stimulus be enough and when will we know?
Visiting fellow at the Australian National University’s Crawford School of Public Policy, Huw McKay, spoke to ABC’s The Business about China’s economic future.
He says while it is yet to be seen whether the stimulus packages announced will work, they are promising and could be the circuit breaker the economy needs.
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The Essential Ingredient’s first creditors meeting set for a week
The gourmet food chain announced last week that it had been put into voluntary administration.
As well as two stores in Melbourne and one in Sydney, the business has an online store and a wholesale business that supplies restaurants and other hospitality businesses.
It employs more than 60 people.
Its directors Syd Weddell and Peter Walmsley say the business’ collapse is an “enormous disappointment”.
“Following our post COVID investments for growth, we faced economic headwinds which have not enabled us to realise the expectation of returning to pre COVID profitability,” they said.
Its admin is being handled by PwC and it has set the first creditors meeting for October 9.
“[Stores] will continue to trade while the Administrators undertake a sale process,” PwC says.
“The Administrators aim to move quickly to preserve as much of the business and as many jobs as possible.”
Lets hope they salvage the famous truffle oil.
‘Increased scrutiny’ on airlines supports Virgin/Qatar deal
As announced yesterday, Qatar Airways wants to take a 25% stake in Virgin.
The deal will need approval from the Foreign Investment Review Board, as well as the ACCC due to requests that Qatar and Virgin will co-operate on certain flights.
It comes just a year after the federal government controversially knocked back Qatar Airways’s request to fly extra planes of its own into Australia.
“Given the political scrutiny over Qatar’s application for bilateral air rights in recent years, the FIRB outcome will be worth watching,” Westpac notes.
“However the increased scrutiny on airlines (Qantas) and competition appear to support the timing of this transaction.”
US labour data consistent with another rate cut
More jobs data has been released in the United States, just weeks after the Federal Reserve delivered its first (and a double) rate cut.
CBA’s analysts reckon the data that’s dropped is “consistent” with the Fed delivering another rate cut soon.
“The job vacancy rate increased back to 4.8% in August though the downtrend is still intact,” they write.
“The quit rate – an indicator of wage growth – decreased below 2.0% for the first time since May 2020.
“But the layoff rate remains very low at 1.0%.”
How Brent crude oil reacted to Iran’s attack
“The Brent crude oil price increased sharply from $US70/brl to as high as $US75.44/brl,” notes CBA this morning.
As its analyst adds, the USD also rose on the attack.
“Government bonds rallied while equity markets retreated up to 2% in Europe and the US.
“While the conflict in the Middle East has potential to escalate further, the USD has potential to jump.”
How Australia’s housing market is faring right now
This piece from my colleague Nassim Khadem looks at the latest monthly property price data and how changes to negative gearing concessions could impact the market.
Why a dock workers’ strike could throw shipping into choas
A US dock workers’ strike reaching from New York to Texas could throw global supply chains into disarray.
This is their union’s first strike since 1977 and it is set to cripple the nearly 50 per cent of US imports that trade through the affected ports.
You can read more about this strike in this piece by my colleague Daniel Ziffer.
ASX to modestly rise as Middle East tensions intensify
Fears of an all out war in the Middle East are impacting financial markets, with the price of crude oil rising as Iran striked Israel.
Wall Street is down with the tech heavy Nasdaq off 1%.
Australian markets are still expected to open modestly up.
We’ll be here with you this morning, and head over to this ABC News blog for updates on the escalating situation in the Middle East as it continues to unfold.
