Uncategorized – Provincial Wealth

The Not So Daily Bulletin 13th January 2026 No. 750

January 14, 2026 (updated January 14, 2026)

Top Stories

On Tuesday, 13 January, the ASX gained 49 points to close at 8809. That’s 90 points higher than the last Not So.

The commodities sector is continuing to rally as Gold, Silver, Copper and Tungsten hit or near ALL TIME HIGHS. Markets are in short supply for critical materials as China controls a raft of these minerals, and precious metals are finding support as President Trump is espousing policies that are more akin to a “banana republic”, which is causing parts of the market to be concerned (rally in gold and silver).

The US jobs report was weaker than expected, which puts some downside pressure on interest rates; however, the inflation report this week might slow that pressure down (if the rate is higher than expected). The US markets seem unconcerned as the Dow Jones and S&P 500 hit new ATH. They are approaching 50,000 and 7,000, respectively.

In Australia, the RBA’s February meeting appears to be 50/50 at this stage between leaving rates on hold and raising them, as retail spending was higher than expected this week. At this stage, Kevin “the interest rate whisperer” Hanson is suggesting the RBA will be on HOLD. In fact, he thinks they might be on HOLD all year. Big call Kev!

CBA dominated the ASX last year, as its market capitalisation rose to over $300 billion (share price x number of shares). However, the gap between CBA and BHP has narrowed over the last few weeks. CBA $258bn & BHP $241bn.

Morgan Stanley is expecting the ASX 200 to finish 2026 at 9250
Below is;
* a piece from Brad Matthews (PW Investment Committee chair) about the market outlook
* The market view on President Trump and the US Federal Reserve chair.
* The January Barometer

We are happy for you to share our Not So Daily Bulletin with family and friends. If we can help them, we are also happy to chat.

Market Outlook 2026

Brad Matthews, our investment consultant, has outlined his outlook.

December’s small gain on global equity markets completed the 3rd successive calendar year of strong market growth, which has seen returns from the global equity asset class average 20.3% per annum over these 3 years. Clearly, this rally is in a mature phase, with valuations extended. In addition, the pattern of recent market growth suggests investors are becoming much more circumspect around technology stocks and the potential for artificial intelligence-related capital expenditure to drive earnings growth continuously higher.

However, despite some recent caution on equity markets, there remains a strong willingness by investors to continue pushing valuations higher, with the more recent focus being on those parts of the market that have been “left behind” and are trading more cheaply than the market average.

The continuation of modest but positive economic growth, a well-functioning and liquid financial sector and the absence of any significant increase in credit defaults, may be all factors that explain the ongoing positive sentiment across share markets. In addition, policy remains generally supportive of share markets, with December’s loosening of monetary policy in the U.S. potentially very important.

In addition to lowering the cash rate, the commitment made by the U.S. Federal Reserve to commence purchasing treasury bills may indicate a willingness of the central bank to support liquidity and bank lending, despite remaining uncertainties over the trajectory of U.S. inflation. With changes in the membership of the Federal Reserve Bank Board expected in 2026, market consensus believes that this supportiveness of equity and bond markets will continue, if not improve, further in the year ahead.

Australia is now somewhat out of step with the United States. Inflation here has picked up, despite subdued economic growth. Expectations of policy tightening (higher interest rates and more constrained government spending), combined with muted economic growth, is not a combination considered conducive to a strong performance on share markets.

The less promising outlook for Australia has already been reflected on share markets to some degree. Australia’s recent share market underperformance would have been even more significant if not for a strong lift in the price of resource stocks (which has been partly driven by a surging gold price).

One potential source of upside for the Australian share market is the possibility that inflation will re-commence its downward trajectory, thereby allowing a more supportive interest rate regime. This scenario would be a positive for both Australian share and bond valuations.

Although the outlook for global equities may continue to be brighter than that for the local market, there are factors that could disrupt the current broad support for global equities. One example is U.S. inflation, and the possibility that it could start to surprise on the upside. Another is the possibility that the ambitious earnings expectations underwriting the U.S. technology sector fail to materialise.

However, whilst it is instructive for investors to consider the possible risks and opportunities impacting market direction in the year ahead, it is normally the unknown (or non-forecastable) factors that have the most impact on markets. For example, 3 years ago, very few investors would have predicted the impact the development of artificial intelligence would have on share markets. Given the future influence of unknown risks and opportunities, investment strategies that pursue genuine diversification, with professional management and the ability to adjust exposures in a timely fashion, are likely to be the most successful over the longer term.

US Federal Reserve (Fed) Independence

One of the cornerstones of the US economy and the strength of the US market is that the US Fed has been considered independent of political influence in making interest rate decisions. This has been a pillar that markets have relied on to keep the economic boat steady, as they focus on employment and inflation, rather than the political will of the ruling party. It’s the same premise our RBA works on, and it has helped reduce the boom-bust cycles we have seen in previous decades.

However, President Trump is very keen to change this, and, like most things, is looking to bring the Fed under his control, as he sees the interest rate as too high.

The latest move is that the US Department of Justice (DoJ) is investigating the US Federal Reserve chairman, Jerome Powell, for overspending (fraud) on Federal Reserve renovations, with the aim of removing Powell (who steps down from the chair role in May).

Markets appear to have viewed this latest step as a non-event, suggesting that they believe the Fed’s independence remains intact.

Some of the reasons could be;
* The DOJ is only investigating, and based on Trump’s previous retaliation cases (Comey, Cook, Kelly, James, Schiff & Smith), they have all gone nowhere, which suggests Powell will remain as chair until May.

* Replacing Powell as Fed chair in May will give President Trump another opportunity to influence the Fed, but the chair only has one vote. There are 12 votes on the Fed, and President Trump will have influence over a couple. The market thinks the Fed will maintain its independence even with a new chair.

If the market loses confidence in the Fed’s independence, then market volatility is likely to increase, as will interest rates on U.S. bonds, which have reached a total of $37 trillion.The US dollar may weaken through this process as global investors allocate money to other markets (US equity markets account for 50% of all global markets and 70% of the MSCI World index). This is why we are looking to hedge the currency with some of the international investors, as the US dollar has potential for weakness. IE, The AUD could move into the 70s or higher over the year.

The January Barometer

The direction of the market in January can dictate the direction for the year. This is known as the January Barometer. From 1950 to 2024, it had an 84% accuracy rate, as the positive or negative result in January has consistently led to the same direction of the market over the year.

There is another barometer: “the first five days of January” barometer.

Over the last 76 years, the first 5 days have been positive 48 times. Of those 48 years, 42 have seen positive investment returns from the market, which is an 87% conversion rate.

The first 5 days were negative 28 times, with only 11 years remaining negative, which is a 40% conversion rate.

The first five days of 2026 were positive, which is a good sign (not a guarantee), but a good start for a positive return in 2026.

Financial Planning Snippets

PLEASE BE VIGILANT regarding financial scamming. If anyone is requesting financial information from you (via phone, email, text, or social media), please contact us first or ask them for their ABN.

Super Guarantee (SGC) for employees increases to 12% from 1/7/25.

Concessional super contributions maximum of $30kCommonwealth Seniors Health Care card has seen the income limit increase to $158,440 (couple) $99,025 (single). If you are of Age Pension age and don’t have the card, please let us know.

Macquarie Cash accounts – IF CHANGING YOUR PHONE, YOU NEED TO DEACTIVATE AUTHENTICATOR AND SWITCH TO THE NEW PHONE

New AGED CARE fees come into effect from 1/11/25. Only for those entering care after this date.

Other Stories
Amcor (AMC) is consolidating into 5 shares into 1. Therefore, for current shareholders, you will have 1 share for every 5 you owned yesterday. It’s currently trading on a deferred basis under code AMCDD for the next week. The share of AMCDD closed today at $64.10

Broker Target Price changes
Target Prices should be viewed as a compass (the general direction) rather than a GPS destination.

Ord Minnett

Morgans

Morgan Stanley
Aristocrat Leisure (ALL) decreased from $73.70 to $72.40
Lend Lease (LLC) decreased from $6.58 to $5.70 (lowest broker)
Santos (STO) decreased from $7 to $6.76 (lowest broker)
Telstra (TLS) decreased from $4.96 to $4.95
Wesfarmers (WES) decreased from $92.60 (Highest broker) to $86

Macquarie
BHP increased from $43 (lowest broker) to $48 (equal highest broker)South 32 (S32) increased from $3.70 to $4.20

Bell Potter/Citigroup

UBS

Tracking changes for 2026
Upgrades 3
Downgrades 10

Core Watchlist Index (changes since last Not So)

The CORE Watchlist is a collection of 30 Australian shares, predominantly “Blue Chip”. We obtain research from up to 6 brokers on each share. Each broker provides a Target Price (value in 12 months) which then provides us with an average for each stock. We then compare that average to the current price as a percentage. IE Macquarie price $176.95 Av. Target Price $205.96= 85.9% (meaning 14.1% upside over next 12 months) + income 4.35% (including franking).

To get the CORE Index we take the average across the 30 stocks. This provides us with a market average as there are up to 80 teams of analysts providing the research and target prices. The CORE Watchlist stocks represent more than 55% of the ASX 200 and so provide us with a good indicator of the market value. When it’s at 100% then the market is fully priced. We have seen that when the index is below 90%, then it’s good buying, but that doesn’t happen very often. Should you have any questions, please let me know.

The Core index increased from 91.51% to 92.22%. If we removed the 4 banks, the index falls to 88.57%

Overall Earnings Per Share (EPS)
FY26 decreased from 7.05% to 7.02%
FY27 increased from 12.95% to 13.06%

Most expensive – CBA 130.7% (176.5% highest ever).
Least expensive – NXT 62%

The CORE Watchlist has 8 (8) stocks trading above 100%; they are; ANZ BHP  CBA NAB RIO S32 WBC WOW lowest number ever is 0, highest is 15. While 11 (11) is trading below 85% (the highest is 18, and the lowest is one). ALL AMC BXB COL CSL GMG LLC NXT RMD SEK STO (Figures in brackets are last Not So).

STOCKS TRADING BELOW ALL BROKER FORECASTS ARE AS FOLLOWS; (it has been a handy indicator in the past). 12 out of the 30 CORE stocks are trading below the lowest broker target price. Highest 24. Lowest is 2.

ALL current price $57.22 Broker range $71 to $75
BXB current price $23.39 Broker range $25.50 to $29.40
COL current price $21.15 Broker range $22.90 to $26.60
CSL current price $173.32 Broker range $188 to $275.00
GMG current price $30.65 Broker range $33.50 to 41.50
LLC current price $5.05 Broker range $5.85 to $6.74
NXT current price $12.48 Broker range $18.00 to $22.10
NEC current price $1.15 Broker range $1.22 to $1.41
RMD current price $38.50 Broker range $47.04 to $51
SEK current price $23.17 Broker range $30.80 to $32.50
SHL current price $23.03 Broker range $24 to $29.40
STO current price $6.14 Broker range $6.80 to $8.15

Added
Removed ORI

Other Indicators (changes since last Not So)

US VIX (Fear) Index decreased from 15.45 to 15.12. Normal is 10-17.
Iron Ore increased from $108.25 to $109.05.  The average expectation for 2026 is $92.
Copper increased from $5.82 to $6.05. It reached an all-time high of $6.11 on 6/1/26.
Gold increased from $4474 to $4602. New ATH $4614 in January. Silver increased from $82.67 to $85.68 which is an all time high.
AUD/USD increased from 66.95c to 67.05c. We believe the AUD may rally to 70c by 2026.
Asian markets – MIXED
US 10-year Bonds increased from 4.17% to 4.20%.  2-year rate 3.55%. 30 year rate below 5% at 4.85%.
German 10 year Bonds decreased from 2.91 to 2.83%
Japanese 10 year Bonds increased from 2.09% to 2.17%. Highest since July 2007 30-year Bond hit an ATH of 3.25%
Aussie Bonds 10 year Bonds increased from 4.68% to 4.69%. 2025 high 4.95%.
Oil prices increased from $58.07 to $60.24
The price of tungsten in China remained at $1038 mtu. The European price range increased from $900mtu to $940mtu to $950mtu to $987mtu. Finally, EQR is starting to follow. It now has a market cap of $500m

This week & next week
Last, “Not So” opened in 7 Aust states (excl NT), 9 US states, Bulgaria, Sweden, Estonia, Turkey, Czech Republic, Switzerland & UK.

This week: Back in the office. A new FINANCIAL PLANNER, Nick Barzen, is joining PW from tomorrow. We will provide more information in the next Update. We will disclose more details next week.

The Not So Daily Bulletin 24th November 2025 No. 745

November 26, 2025 (updated November 26, 2025)

The Not So Daily Bulletin 29th October 2025 No. 740

November 3, 2025 (updated November 3, 2025)

Top Stories

On Wednesday, October 29, 2025, the ASX fell 1% or 86 points to finish at 8926.

The market was holding steady until the hotter-than-expected inflation number was released.

Best summed up by Bell Potter’s Coppo report.

1. The ASX 200 was smacked -86 points or -0.96% (low -91pts) after the hotter than expected inflation number today effectively ruled out any chance of a rate cut next Tuesday by the RBA – that ship has now sailed.
2. In fact, some think it’s killed the rate cycle completely, with December now a zero chance & a cut next year in February now seen as a write off.
3.  So with the prospect of no more rate cuts for a while the market hit the banks, financials & REITS.
4.  In fact the risks that inflation trends back up, could mean that the unthinkable is now a real chance – that the next move by the RBA in 2026 could be a rate hike!!!
5.  But there is a lot of economic data to come before the odds of that start to firm.
6. Tomorrow is a big day here, that could well show the roadmap that the US mkt will meander between now & XMAS.
9.   The FED will cut rates tonight -25pts and at the press conference after at 5.30am Syd time if Powell even “hints” that there is the “chance” of another cut in December – mkts will get excited
10.  Then just after 7am (after US mkt has closed) Microsoft, Alphabet & Meta all report – and they will really shape things going forward.

We are happy for you to share our Not So Daily Bulletin with family and friends. If we can help them, we are also excited to chat.

Australian inflation – higher than expected!
The Australian quarterly inflation rate came in at 1.2% and 3.2% for the year, which was hotter than expected. Additionally, the core of the trimmed inflation rate, which excludes the volatile components of food and energy, remains at 3%.

The share market took this as a negative as the expectation of an interest rate cut was reduced. Kevin “the interest rate whisperer” Hanson agrees, we are unlikely to see an interest rate cut on Melbourne Cup day.

U.S.-China trade negotiations There is likley to be a meeting this week in South Korea with Trump and Xi

AMP’s Shane Oliver provided a summary of the current positions.

Overall, in the short term, China has an upper hand in negotiations for three reasons:

1. While domestic economic growth is still slowing, 4.8% growth rate is not a recessionary level, and softening growth has not been driven by tariffs. Past attempts at stimulus measures have shown that they worked, so the Chinese government will only deploy them as necessary.

2. China has clear dominance in the supply chain of critical minerals and raw materials for emerging technology. At least in the next few years, China is not dependent on just the US as a customer.

3. The US faces more domestic and market constraints. Trump still sees the financial markets, whether shares or bonds, as important to his success. Every threat to raise tariffs to prohibitively high levels this year has been followed by a backdown and efforts to convince investors that “it will all be fine!” or commonly referred to as the TACO (Trump Always Chickens Out) trade. More importantly, as mid-term elections come closer, the government will need to refocus on both containing inflation and addressing slowing jobs growth – neither of which is helped by trade wars or policy uncertainty.

However, in the long term, national security concerns will see both countries race to patch up their respective weaknesses (i.e. rare earths supply for the US and chipmaking capabilities for China).

Ultimately, a more fragmented and less specialised supply chain only means that productivity won’t be as high as it could be, and may well threaten the superiority of the US market in the next century.

US tech bubble?
Five of the magnificent seven are reporting their quarterly earnings over the next two days. The market is anticipating growing results that have pushed most to near ALL-TIME HIGHS. While the S&P 500 is up 17% for the year, the Mag 7 has accounted for 60% to 70% of the gain in the S&P 500. This is after accounting for 57% of the S&P500 24% in 2024.

There is increasing talk of an AI bubble that can’t be ruled out, however, in a research note from Goldman Sachs, they say while the sheer scale of market dominance of leading technology companies is striking: the top five US technology companies collectively hold a value exceeding the combined size of the Eurostoxx 50, the UK, India, Japan, and Canada, representing approximately 16% of the entire global public equity market. That said, while technology stocks have increased dramatically in size, they do not think we are in a bubble yet:

1. AI applications are boosting productivity when deployed.

2. Unlocking these productivity benefits requires significant computational power, especially since models are increasing in size (see chart exhibit 6 below) much more quickly than computation and energy costs are falling. Goldman Sachs are not concerned about the total amount of AI investment. AI investment as a share of US GDP is smaller today (<1%) than in prior large technology cycles (2-5%) as seen in the table below

3. The appreciation of the technology sector has, thus far, been primarily driven by fundamental growth and robust earnings, rather than irrational speculation about future potential.

4. The leading companies that have experienced the strongest returns possess unusually strong balance sheets.

5. The AI space has, to date, been dominated by a few established incumbents. Most historical bubbles, conversely, formed during periods of intense competition as both investors and numerous new entrants flocked into the space.

Furthermore, Goldman Sachs estimates an $8tn capital revenue unlocked by AI productivity gains in the US, with plausible estimates ranging from $5tn-$19tn (chart below: % of GDP spent investing in new technology). These estimates exceed current cumulative AI investment forecasts. Nevertheless, market concentration is historically high, and given these risks, the focus is on diversification strategies.

US Tech quarterly earnings
The overall expectations for the Mag 7 from this quarter are as follows;

Overall Expectations
Earnings Growth: The Magnificent Seven are projected to post 11.9% to 14.9% year-over-year earnings growth, significantly outpacing the rest of the S&P 500, which is expected to grow at 6.7%.
Revenue Growth: Revenue growth for the group is expected to be around 15.3%. [fxstreet.com]
AI Spending: Capital expenditures, especially for AI infrastructure, are a major theme. Microsoft, Alphabet, Amazon, and Meta are expected to spend $360 billion in 2025, rising to $420 billion in 2026.

Microsoft (Reporting Oct 29)
Expected EPS: $3.65 (up 10.6% YoY)
Revenue Estimate: $74.96B (+14.3% YoY)
Key Drivers: Azure cloud growth (projected +38%), Copilot AI adoption, and enterprise contract expansion.

Alphabet (Reporting Oct 29)
Expected EPS: $2.27
Focus Areas: Cloud business momentum, search dominance in the AI era, and DOJ case resolution.
Stock Performance: Up 41.6% YTD return.

Meta Platforms (Reporting Oct 29)
Expected EPS: $8.10
Strengths: Strong ad revenue, AI-powered products (e.g., smart glasses), and Family of Apps performance.
Surprise History: Average earnings surprise of 19.23% over the last four quarters.

Amazon (Reporting Oct 30)
Expected EPS: $1.58
Revenue Guidance: $174B–$179.5B (+10–13% YoY)
Key Issues: AWS outage, AI infrastructure spending, advertising growth, and Q4 holiday season outlook.

Apple (Reporting Oct 30)
Expected EPS: $1.76
Concerns: Lagging AI investment compared to peers, which may explain recent underperformance.
Positives: Strong iPhone 17 sales and record share price.

Nvidia (Reporting Nov 19)
Expected EPS: $0.78
Focus: AI chip demand, data centre growth, and its role as the backbone of AI infrastructure.
Performance: 50% YTD return; consistently strong earnings surprises

Bubble Watch: The Magnificent Seven now represent over one-third of the S&P 500’s market cap, raising concerns about market concentration.

Fed Rate Cut: A potential rate cut this week could further boost tech valuation.

Bank earnings
Citibank provided the following comments regarding the upcoming bank profit results.
WBC (3 Nov) – FY25 Cash Net Profit After Tax (NPAT) $6,807m, Basic Cash Earnings Per share (EPS) 199c, Dividend per share (DPS) 152c
Our cash earnings estimate is 3.6% below consensus on account of lower BDD expenses and recently announced restructuring costs of $273m, which consensus fails to incorporate fully, in our view. Adjusted for one-time restructuring costs, our core earnings are in line with consensus, while cash earnings are 1% below consensus.

NAB (6 Nov) – FY25 Cash NPAT $7,107m, Basic Cash EPS 232c, DPS 170c
Our cash earnings estimate is 1% below consensus, on account of higher BDD expenses than consensus. On PPoP, we are in line with consensus.

MQG (7 Nov) – 1H26 Cash NPAT $1,877m, Basic Cash EPS 495c, DPS 280c
Our 1H26 cash earnings estimate is in line with consensus, although our segmental mix varies. On MAM, we are 15% below consensus, but 7-8% higher for CGM and MacCap. The risk with the result is that depending on the timing of realisations, the typical reliance on 2H seasonality could be greater this year to meet guidance and consensus.

ANZ (10 Nov) – FY25 Cash NPAT $6,356m, Basic Cash EPS 214c, DPS 166c
Our cash earnings estimate is 1% below consensus, attributed to one-time costs restructuring and ASIC settlement costs which is not fully captured by consensus yet. Adjusted for the same, our core earnings are in line with consensus. We see upside risk to our earnings estimate as 2H25 underlying opex may turn out to be below management guidance given the recent focus on cost resets.

1Q quarterly trading updates for CBA (11 Nov)

UBS numbers are
WBC NPAT $6.6bn EPS $1.93 and Dividend $1.55
NAB NPAT $7.2bn EPS $2.31 and Dividend $1.70
MQG NPAT $1.999bn EPS $5.25 and Dividend $3.10
ANZ NPAT $6.806bn EPS $2.25 and Dividend $1.66

CSL
CSL was the third largest company on the ASX; however, after announcing last month, it was splitting off one of its businesses. Yesterday at the AGM, they announced that growth would be in the high single digits rather than the low single digits.

Due to several factors, including US tariffs, declining US vaccination rates (RFK Jnr) and cost-cutting measures in China. The company suggested that workarounds were available, but they would require some time. The market obviously didn’t want to wait, and the stock was sold down 16% and a further 4% today.

The brokers updated their numbers as outlined in the target price section.

The interesting observation is that they still have only BUY & HOLD recommendations, and profit and dividends are still expected to grow each year.

Comments from Bell Potters Coppo report. CSL hit a 7-year low, as quants and machines sold on earnings downgrades, plus institutions also joined in again today, as the stock followed yesterday’s -15.9% savaging after they cut the earnings outlook and delayed the Seqirus demerger amid weak US vaccine demand and China cost pressures. Volume yesterday was massive at 5.6m shares (vs normally 2.3m), and again today it was elevated (indicating more selling was hitting it) at 3.9m shares. This will take a while to recover & so is a write-off for the rest of 2025.

PW fundamental comparison
For those brave enough. Look at the comparison with CBA. They have the same share price, even after today’s downgrades by the brokers, CSL is expected to earn over $4 per share more ($10.93 v $6.33), which gives CSL a PE of 15 compared to 26 for CBA. Even the dividend is close, CSL is still expected to increase its dividend over the next 3 years.

Exchange Traded Fund series
An Exchange Traded Fund (ETF) is a type of investment fund that is traded on stock exchanges, much like individual stocks.
An ETF;
Holds a collection of assets such as stocks, bonds, commodities, or a mix.
Tracks an index, sector, commodity, or other asset (e.g., ASX 200, S&P 500, gold).
Trades like a stock, meaning you can buy and sell it throughout the trading day at market prices.
Other features
Diversification: One ETF can give exposure to dozens or hundreds of companies.
Liquidity: Easy to buy/sell on the exchange.
Lower Fees: Typically cheaper than actively managed funds.
Transparency: Holdings are usually published daily.
Dividends: Many ETFs pay out dividends from the underlying assets.

Index ETFs: Track a market index (e.g., ASX 200, S&P 500).
Sector or Thematic ETFs: Focus on specific industries (e.g., tech, healthcare).
Bond ETFs: Invest in government or corporate bonds.
Commodity ETFs: Track commodities like gold or oil.
International ETFs: Provide exposure to global markets.
Smart Beta ETFs: blends index with active strategies like quality, volatility, dividends, or value—rather than traditional market capitalisation.

The ETF market has grown very quickly in terms of dollars, with a 35% increase in the last year to approx $300bn (similar market cap to CBA) and also a rapid growth of products on the ASX with over 400 different ETFs. We currently assess 80.

5. Betashares Global Cybersecurity ETF (HACK)

HACK ETF provides a passive exposure to global cybersecurity companies predominantly in industries including systems software, IT consulting and communication services. Cybersecurity can be viewed as a growing sector given the rise in cybercrime. The ETF includes global cybersecurity giants as well as emerging companies in the space with the aim of tracking the performance of the Nasdaq Technology Association Cybersecurity which comprises around 40 companies. There is no currency hedging in this fund.

Growth Drivers

Rising Cybercrime
Cyber threats are increasing globally, with Australia reporting a 23% year-over-year rise in cybercrime incidents and an average cost of $46,000 per small business incident. This trend is pushing governments and businesses to invest more in cybersecurity.

Digital Transformation
As more activities move online—banking, shopping, communication—the need for robust cybersecurity grows. This makes the sector both defensive and growth-oriented, even during economic downturns.

Strong Performance History
1-Year Return: +28.19%
5-Year Return: +90.86%Since Inception (2016): +203.01%
These figures reflect consistent long-term growth.

Global Exposure
The ETF includes leading cybersecurity firms from the U.S., Israel, India, France, and Japan, offering diversified access to a high-growth sector.

Sector Focus
With 93.65% of holdings in the Technology sector, the ETF is tightly aligned with innovation and digital infrastructure.

Number of holdings 39.

Top sectors
Technology: 93.65%
Industrials: 6.5%

Top regions
US: 75-80%
India: 7.5%
Israel: 8%
France: 4%
Japan: 1.7%

End of Sep 2025 return 34.25%

Previous in series
1. VanEck Global Quality (QUAL/QHAL)
2. VanEck Global Value (VLUE)
3. iShares Asia (IAA)
4. Global X Artificial Intelligence (GXAI)

Financial Planning Snippets
PLEASE BE VIGILANT regarding financial scamming. If anyone is requesting financial information from you (via phone, email, text, or social media), please contact us first or ask them for their ABN.
Super Guarantee (SGC) for employees increases to 12% from 1/7/25.
Concessional super contributions maximum of $30k
Commonwealth Seniors Health Care card has seen the income limit increase to $158,440 (couple) $99,025 (single). If you are of Age Pension age and don’t have the card, please let us know.

Macquarie Cash accounts – IF CHANGING YOUR PHONE, YOU NEED TO DEACTIVATE AUTHENTICATOR AND SWITCH TOTHE NEW PHONE New AGED CARE fees come into effect from 1/11/25. Only for those entering care after this date.

Other Stories
– BHP is settling 30% of Iron Ore contracts in Yuan and not USD in 2026.
– US announces $80bn investment in nuclear reactors built by Westinghouse.

Broker Target Price changes

Target Prices should be viewed as a compass (the general direction) rather than a GPS destination.

Ord Minnett
CSL decreased from $258 (lowest broker) to $235

Morgans
CSL decreased from $293.83 to $249.51
Woodside (WDS) increased from $29.60 to $30.50

Morgan Stanley
CSL decreased from $285 to $248
CBA increased from $143.70 (highest broker) to $144.80 (still highest broker)
Goodman Group (GMG) increased from $40.47 (highest broker) to $41.50 (still highest broker)
South 32 (S32) increased from $3.25 to $3.45
Westpac (WBC) increased from $32.20 to $31.60

Macquarie
CSL decreased from $295.90 to $275.20 (highest broker)

Bell Potter/Citigroup
CSL decreased from $265 to $230 (lowest broker)

UBS
CSL decreased from $300 (highest broker) to $275

Tracking changes for 2025
Upgrades 341
Downgrades 265

Core Watchlist Index (changes since last Not So)
The CORE Watchlist is a collection of 30 Australian shares, predominantly “Blue Chip”. We obtain research from up to 6 brokers on each share. Each broker provides a Target Price (value in 12 months) which then provides us with an average for each stock. We then compare that average to the current price as a percentage. IE Macquarie price $176.95 Av. Target Price $205.96= 85.9% (meaning 14.1% upside over next 12 months) + income 4.35% (including franking).

To get the CORE Index we take the average across the 30 stocks. This provides us with a market average as there are up to 80 teams of analysts providing the research and target prices. The CORE Watchlist stocks represent more than 55% of the ASX 200 and so provide us with a good indicator of the market value. When it’s at 100% then the market is fully priced. We have seen that when the index is below 90%, then it’s good buying, but that doesn’t happen very often. Should you have any questions, please let me know.

The Core index increased from 96.16% to 96.19%. If we removed the 4 banks, the index falls to 92.03%

Overall Earnings Per Share (EPS)
FY25 decreased from 2.58% to 2.53%
FY26 increased from 6.71% to 6.99%

Most expensive – CBA 145% (176.5% highest ever).
Least expensive – CSL 76.9%.

The CORE Watchlist has 10 (9) stocks trading above 100%; they are; ANZ CBA JBH MQG NAB RIO TCL TLS WBC WES lowest number ever is 0, highest is 15. While 6 (7) is trading below 85% (the highest is 18, and the lowest is one). AMC CSL NXT RMD SHL STO (Figures in brackets are last Not So).

STOCKS TRADING BELOW ALL BROKER FORECASTS ARE AS FOLLOWS; (it has been a handy indicator in the past). 13 out of the 30 CORE stocks are trading below the lowest broker target price. Highest 24. Lowest is 2.

ALL current price $64.75 Broker range $70 to $77
AMC current price $12.58 Broker range $14.20 to $18.25
BXB current price $24.67 Broker range $25.50 to $29.40
COL current price $23.07 Broker range $23.45 to $26.80
CSL current price $217.55 Broker range $258 to $300
LLC current price $5.67 Broker range $5.90 to $7.12
NXT current price $16.19 Broker range $18.00 to $22.10
ORI current price $22.01 Broker range $22.71 to $25
RMD current price $41.22 Broker range $47.86 to $49
SEK current price $27.84 Broker range $30.80 to $32.50
SHL current price $21.64 Broker range $24.50 to $29.40
STO current price $6.45 Broker range $6.80 to $8.88
WOW current price $26.82 Broker range $28.25 to $33

Added
Removed

Banking Index (changes since last Not So)
Like the CORE Watchlist index, the Banking index is the four major banks’ average target price based on research from up to 6 brokers. The percentage below 100% is the potential upside over the next 12 months (not including income). If at or over 100%, then this indicates the Banks are fully priced.

The banking index decreased from 123.8% to 122.4%. Lowest is ANZ 112.1% Highest CBA 143.7%

Based on today’s bank prices, the table below shows the estimated dividends (c) and yield. PLUS FRANKING.
   FY 25 % FY 26 % FY 27 %
ANZ 164.00 4.44% 162.00 4.38% 166 4.49%
CBA 485.00 2.85% 501.40 2.85% 518.2 3.04%
NAB 170.00 3.91% 171.20 3.94% 167.8 3.86%
WBC 152.00 3.97% 154.60 4.04% 151.6 3.96%
MQG 650.00 2.90% 745.25 3.32% 814.75 3.64%
CBA yield is below all the others.

Dividend expectations for BHP and RIO. The forecasts below are for the full year.    Plus franking. Please note RIO is Calendar Year (CY). Cents per share (CPS).
   FY 25 % FY 26 % FY 27 %
BHP 171.00 3.90% 172.20 3.92% 185.80 4.23%
RIO 587.20 4.41% 629.00 4.72% 625.40 4.70%

Other Indicators (changes since last Not So)
US VIX (Fear) Index decreased from 18.60 to 16.42. Normal is 10-17, so back in the normal range as US/China trade issues settle, but the government remains shut down.
Iron Ore increased from $104.15 to $106.  The average expectation for 2025 is $98.3.
Copper increased from $5.02 to $5.17. It reached an all-time high of $5.8955 on July 8.
Gold decreased from $4145.20 to $3970. New ATH $4393.60 last week. Profit-taking dropped back nearly 10% from its high.
AUD/USD increased from 65.00c to 65.97c. Rate cut off the card.
Asian markets – mainly higher with Japan hitting 51,000 for the first time.
US 10-year Bonds increased from 3.97% to 3.98%.  2-year rate 3.50%. 30 year rate below 5% at 4.54%.
German 10 year Bonds increased from 2.57% to 2.61%.
Japanese 10 year Bonds decreased from 1.66% to 1.65%. Highest for 20 years. 30-year Bond hit an ATH of 3.25%
Aussie Bonds 10 year Bonds increased from 4.14% to 4.23%. 2025 high 4.95%.
Oil prices decreased from $60.68 to $60.07
The price of tungsten in China increased from $623mtu to $643mtu. The European price range increased from $600mtu-$685mtu to $610mtu to $685mtu. Prices are at an all-time high due to the Chinese continued export ban.

This week & next week Last, “Not So” opened in 7 Aust states (excl NT), 7 US states (including a new state – 31st New Hampshire), Bulgaria, Sweden, Germany, Romania and South Africa.

The Not So Daily Bulletin 1 October 2025 No.735

October 2, 2025 (updated October 2, 2025)

Top Stories

On Tuesday, October 1, 2025, the ASX reduced 3 points to finish at 8846.

Today was a relatively flat day, as the focus was on the US and whether the government would remain open, as well as whether China had temporarily banned BHP’s iron ore. The ban proposed by the Chinese Mineral Resources Group, a state-owned buyer, is due to concerns over iron ore pricing. BHP hasn’t confirmed the ban, but it did drop 2.49% today.  Interestingly, both RIO and FMG increased today.

Yesterday, the RBA announced that interest rates would remain on hold, as predicted by Kevin “the interest rate whisperer” Hanson. Kevin said it’s too early to predict whether a cut will be made on Melbourne Cup day.

Most markets have delivered a positive September, except for the ASX, which has lagged the others.  Will the expected volatility come in October? If the US government shutdown drags on for a while, it might provide some volatility, but history shows that it is probably a BUY THE DIP moment.

The Utes are rolling into Deni for the 27th Ute Muster, which is fully sold out for the first time.

We are happy for you to share our Not So Daily Bulletin with family and friends, and if we can help them, we are also excited to chat.

September Market Review
Most markets were positive during the month, bucking the historical trend for September, which is typically weaker, with only Germany and the ASX being negative. The best performers were Hong Kong, up 7% due to a recovery in Chinese technology stocks and increased investor confidence. The US Nasdaq rose 5.6% again, driven by technology. Japan gained 5% on renewed confidence following the resignation of the Japanese Prime Minister and the signing of a US-Japan trade deal. For the ASX, it was a combination of stocks trading ex-dividend, weaker energy prices and banks pulling back after a strong run.

Over the last six months, all markets have remained positive as they have navigated global trade issues and US tariffs. The US Nasdaq was again the best, gaining 31%, while Japan rose 26%. The ASX was mid-pack with a gain of 12.8%, while the AUD gained 5.8% against a weaker USD.

Over the last year, all markets have been positive as inflation and interest rates have returned to lower levels. The structural change brought about by AI has been a more potent force than the tariff/trade uncertainty. Most markets are in double digits, with Hong Kong leading the way with a gain of 27%. The ASX has gained 7% with the World index (MSCI) up more than double that at 15.7%.

Five years ago, we were dealing with COVID. Markets have been robust over that period, with all indices in double figures, and the US Nasdaq and S&P 500 doubling.

Ten years ago, we were witnessing the European migrant crisis, a slowdown in China, and a slump in commodity prices. Since then, markets have more than doubled in the US, Germany & Japan, with the ASX gaining 76%.

Fifteen years ago, we were still recovering from the GFC, as the US Federal Reserve was considering a second round of quantitative easing to bolster the economy. Since then, nearly all markets have doubled, with China being the notable exception.

Twenty years ago, Hurricane Katrina pushed up energy prices, and Israel withdrew from Gaza. As for equity markets, returns have been robust, with the NASDAQ nearly up 10 times.

Despite short-term volatility, history continues to show that a long-term investment horizon rewards patience and discipline. Structural trends, such as AI, combined with global economic resilience, support a positive outlook for diversified portfolios.

Core & ETF September 2025 Review
As always, performances were mixed throughout the month. The ASX fell 1.38% for the month, and the financial year was up 3.59% for the 3 months. While for the calendar year (9 months) ASX was up 8.46%.

CORE Watchlist
30 ASX-listed stocks from our CORE Watchlist.
The best performers for the month were Rio Tinto (RIO), up 5.68% on an improved commodity price outlook, particularly copper. NAB increased 3.2% after hitting new ALL TIME HIGHS during the month on multiple days. These are the new highs since November 2007. NextDC (NXT) increased 2,55% after gaining 13.7% last month. The increasing demand for data centres will see increased earnings in the coming years.

The worst performers for the month were Santos (STO), down 16% after the takeover deal was called off. This led to Woodside (WDS) being down 12.8% as energy prices softened during the month. Sonic Health was down 10.85% due to continued weakness in the health sector.

Over the financial year (3 months), the best performers were Seek.com (SEK), up 18.5%, as they continue to benefit from the recent profit results. NXT up 16.7% and BHP 15.7% due to higher commodity prices.

Other notable gainers were Westpac +15.1%, ANZ +13.9% Coles (COL) +12.8% NAB +12.2% and Orora (ORA) +10%

The worst performers were SHL down 21.1%, CSL down 18.9% and Amcor (AMC) down 14.5% due to concerns re-tariffs.

Over the calendar year (9 months), the best performers were Brambles (BXB), up 28.9% on positive profit results, Wesfarmers (WES) up 28.6% on good profit results and strong consumer demand and Orica (ORI), up 27.5% on strong profit results and future guidance.

Other notable gainers for nine months were SEK +26% JB Hi Fi (JBH) +25% Coles (COL) +23%, Telstra (TLS), +20%,

The worst performers were CSL, down 27.6% on weaker sentiment for healthcare and tariff impacts., SHL, down 20.6%, and South 32(S32), down 19.4% as some of their commodity mix has suffered.

EXCHANGE-TRADED FUNDS (ETF)
As part of our research, we cover approximately 80 ETFs. The best and worst performers for the period(s) were as follows.

The best performers for the month are Battery Tech and Lithium (ACDC), up 10.5%, were also among the best three for the last two month as the switch into energy continues. Asia (IAA) up 9.9% as a rally in Chinese technology stocks continues, and Global Semiconductors (SEMI) up 9.8% as demand for computer chips remains strong.

Other notable gainer for the month was Korea (IKO) +8.3%, Global Artificial Intelligence (GXAI) +7.5% & China (IZZ).

The worst three were China New Economy (CNEW) down 3.3% after having a strong previous few months. Global Health (IXJ) is down 1.4% due to continued weakness in the healthcare sector, attributed to tariffs and US health policy. Aust Equal Weighted Shares (MVW) down 1.3% as the ASX fell 1.38%

Over the financial year (3 months), the best performers were ACDC, up 31.4%, and Australian Resources (MVR), up 19.1%, on the back of stronger commodities, including gold and silver. CNEW up 19.3%.

The worst three were Global Cybersecurity (HACK), down 2.5% due to some profit taking after a strong 6 months. IXJ down 1% and Europe (IEU) down 1% after a strong few months.

Over the calendar year (9 months) the best performers were Korea (IKO), up 44.3% as it continues its strong run after political instability improved.  ACDC up 33.2% & IAA up 26.8%

Other notable gainers were CNEW +20.1%, China (IZZ) +20%, Europe (IEU) +16.3%, Asia (IAA) +15.4% World ex-US (VEU) +15.2%, MVR +15.2%.

The worst performers were Global Cloud Computing (CLDD), down 7.7%, after a strong rally over the last couple of years, IXJ wasdown 5% and Global Robotics and AI (RBTZ) up 0.7%.

US Govt Shutdown
A US government shutdown looks set to happen from tonight.

According to the Bell Potter Coppo report

The table below lists each of the six prior Federal Government shutdowns that lasted longer than a day, based on a list from Wikipedia. For each one, we show how the S&P 500 performed following the start of each shutdown. While performance over the following week and month was mixed, three, six, and twelve months later, the S&P 500 was higher five out of six times.

Not only were returns generally positive, but they were also significantly better than the average for all periods. One comment we have heard multiple times about the market heading into the upcoming shutdown is that with the market trading right near all-time highs, investors are ignoring the risks of a shutdown.

As the table illustrates, though, leading up to four of the six prior shutdowns, the S&P 500 was within 2% of an all-time high, and yet returns were generally positive regardless.
• While a government shutdown lasting longer than a few days would surely be problematic for many federal employees whose paychecks would be delayed, for most other Americans, the only impact of a government shutdown is the endless coverage of it in the news.
• So, maybe rather than ignoring the ‘risks’ of a shutdown, investors realize that the idea of a shutdown is mostly all bark and little bite.

Commodities
Ord Minnett has reviewed its commodity price assumptions as we head into the end of the September quarter where commodities have largely outperformed our expectations, albeit only modestly, with gold (again) being the obvious exception.

In our view, markets over the period have held up mainly due to supply-side issues.

The global economy is still feeling the effects of the trade war waged by the US against its trading partners although the nominal level of the tariff imposts now appears to be lower than first feared. Nevertheless, global trade in goods has shrunk and the world economy has grown at a slower rate than it otherwise would.

Adding to downward pressure on demand has been a series of soft activity data across most major economies that has spurred most central banks into an easing cycle to support growth. Of particular relevance to Australia is China, where Beijing has embarked on what it has coined an ‘anti-involution’ campaign – the aim being to end the fierce self-destructive competition wrought by cutthroat margins and overcapacity that eventually leads to diminishing returns and stagnation across key industries – but so far it appears to be more style than substance in terms of managing overproduction and promoting industry consolidation. Despite this global backdrop, supply-side issues have allowed commodity prices to be supported.

Commodity price forecasts
Most of our price estimates have been increased for the 2025 and 2026 years, but we highlight some key changes to our 2026 estimates:

• Copper – up 11%, reflecting the above-mentioned supply issues which led to a 4% cut in our forecast for market supply tonnage in 2026;
• Iron ore – up 5%, underpinned by relatively solid demand from China and higher-cost ore supply being withdrawn from the market;
• Coking coal – up 11%, as current prices are not realistic given steel demand, in our view;
• Lithium spodumene – up 25%, reflecting a more balanced supply/demand equation.

Stock choices
Ord Minnett maintain preference for Rio Tinto (RIO, Accumulate) over BHP (BHP, Accumulate) in the large diversified miners, given the former’s volume growth prospects and cheaper multiples, and prefer base metals over bulk commodities, e.g. Alcoa (AAI, Buy) in aluminium. Our favoured gold exposures include Newmont Mining (NEM, Buy) and Capricorn Metals (CMM, Buy). Our updated commodity prices forecasts are detailed in Table 1.

Exchange Traded Fund Series
An Exchange Traded Fund (ETF) is a type of investment fund that is traded on stock exchanges, much like individual stocks.
An ETF:
Holds a collection of assets such as stocks, bonds, commodities, or a mix.
Tracks an index, sector, commodity, or other asset (e.g., ASX 200, S&P 500, gold).
Trades like a stock, meaning you can buy and sell it throughout the trading day at market prices.

Other Features
Diversification: One ETF can give exposure to dozens or hundreds of companies.
Liquidity: Easy to buy/sell on the exchange.
Lower Fees: Typically cheaper than actively managed funds.
Transparency: Holdings are usually published daily.
Dividends: Many ETFs pay out dividends from the underlying assets.

Index ETFs: Track a market index (e.g., ASX 200, S&P 500).
Sector or Thematic ETFs: Focus on specific industries (e.g., tech, healthcare).
Bond ETFs: Invest in government or corporate bonds.
Commodity ETFs: Track commodities like gold or oil.
International ETFs: Provide exposure to global markets.
Smart Beta ETFs: blends index with active strategies like quality, volatility, dividends, or value—rather than traditional market capitalisation.

The ETF market has grown very quickly in terms of dollars, with a 35% increase in the last year to approx $300bn (similar market cap to CBA) and also a rapid growth of products on the ASX with over 400 different ETFs. We currently assess 80.

3. iShares Asia 50 ETF (IAA)
provides passive exposure to the 50 largest companies in Asia, primarily from more developed markets, including China, Hong Kong, South Korea, Singapore, and Taiwan. The ETF aims to track the performance of the S&P Asia 50 Index, offering investors a way to diversify internationally and express a regional view. The fund is unhedged against currency fluctuations, meaning exchange rate movements may influence its returns.
As of 31 August 2025:Number of Holdings: 68 companiesPrice-to-Earnings (P/E) Ratio: 14Dividend Yield: 2.17%Return on Equity (ROE): 19.97%Management Fee: 0.29% (reduced from 0.50% as of 29 October 2024).
The top country allocations are:
• China 42.1%
• Taiwan 32.8%
• South Korea 15.2%
• Hong Kong 5.2%
• Singapore 4.4%

The top sector exposures are:
• Information Technology: 44.6%
• Financials: 17.9%
• Consumer Discretionary 17.2%
• Communications 16.6%

Over the last year, up 33%, over the last 3 years, 16.80% per year. Started in Sept 2008.

Previous in series
1. VanEck Global Quality (QUAL/QHAL)
2. VanEck Global Value (VLUE)

Financial Planning Snippets
PLEASE BE VIGILANT regarding financial scamming. If anyone is requesting financial information from you (via phone, email, text, or social media), please contact us first or ask them for their ABN.
Super Guarantee (SGC) for employees increases to 12% from 1/7/25.
Concessional super contributions maximum of $30k
Commonwealth Seniors Health Care card has seen the income limit increase to $158,440 (couple) $99,025 (single). If you are of Age Pension age and don’t have the card, please let us know.

Macquarie Cash accounts – IF CHANGING YOUR PHONE, YOU NEED TO DEACTIVATE AUTHENTICATOR AND SWITCH TOTHE NEW PHONE

Other Stories
Macquarie reduced interest rates after the RBA cut. CMA 2%, Accelerator 3.9%.
– NSW Water allocations released today. Murray General 18% (increased by 8%), Murrumbidgee General 23% (increased 5%) and Lachlan General 82% (no increase).

Broker Target Price Changes
Target Prices should be viewed as a compass (the general direction) rather than a GPS destination.

Ord Minnett
BHP increased from $42.50 to $45
Rio Tinto (RIO) increased from $121 (equal highest broker) to $127 (highest broker)
South 32 (S32) increased from $3.95 (highest broker) to $4 (still highest broker)

Morgans
Seek.com (SEK) increased from $30 to $30.80

Morgan Stanley

Macquarie
Amcor (AMC) decreased from $17.46 to $17.44
NextDC (NXT) decreased from $22.30 (highest broker) to $20.90

Bell Potter/Citigroup

UBS

Tracking changes for 2025
Upgrades 300
Downgrades 242

Core Watchlist Index (changes since last Not So)
The CORE Watchlist is a collection of 30 Australian shares, predominantly “Blue Chip”. We obtain research from up to 6 brokers on each share. Each broker provides a Target Price (value in 12 months) which then provides us with an average for each stock. We then compare that average to the current price as a percentage. IE Macquarie price $176.95 Av. Target Price $205.96= 85.9% (meaning 14.1% upside over next 12 months) + income 4.35% (including franking).

To get the CORE Index we take the average across the 30 stocks. This provides us with a market average as there are up to 80 teams of analysts providing the research and target prices. The CORE Watchlist stocks represent more than 55% of the ASX 200 and so provide us with a good indicator of the market value. When it’s at 100% then the market is fully priced. We have seen that when the index is below 90%, then it’s good buying, but that doesn’t happen very often. Should you have any questions, please let me know.

The Core index increased from 94.50% to 95.03%. If we removed the 4 banks, the index falls to 90.82%

Overall Earnings Per Share (EPS)
FY25 increased from 2.45% to 2.51%
FY26 increased from 6.21% to 6.41%

Most expensive – CBA 141.1% (176.5% highest ever).
Least expensive – CSL 70.3%.

The CORE Watchlist has 7 (7) stocks trading above 100%; they are; ANZ CBA JBH NAB RIO WBC WES lowest number ever is 0, highest is 15. While 7 (6) is trading below 85% (the highest is 18, and the lowest is one). AMC CSL LLC RMD S32 SHL STO (Figures in brackets are last Not So).

STOCKS TRADING BELOW ALL BROKER FORECASTS ARE AS FOLLOWS; (it has been a handy indicator in the past). 12 out of the 30 CORE stocks are trading below the lowest broker target price. Highest 24. Lowest is 2.

ALL current price $69.56 Broker range $70 to $77
AMC current price $12.31 Broker range $14.20 to $18.25
CSL current price $198.80 Broker range $258 to $300
LLC current price $5.44 Broker range $5.90 to $7.12
NXT current price $16.89 Broker range $18.00 to $22.10
ORI current price $21.29 Broker range $22.41 to $24.76
RMD current price $41.36 Broker range $47.86 to $49
SEK current price $28.59 Broker range $30.80 to $32.50
SHL current price $21.32 Broker range $24.50 to $29.40
STO current price $6.76 Broker range $7 to $8.88
WDS current price $22.85 Broker range $24.85 to $29.60
WOW current price $26.47 Broker range $28.25 to $33

Added
Removed S32

Banking Index (changes since last Not So)
Like the CORE Watchlist index, the Banking index is the four major banks’ average target price based on research from up to 6 brokers. The percentage below 100% is the potential upside over the next 12 months (not including income). If at or over 100%, then this indicates the Banks are fully priced.

The banking index increased from 122.3% to 122.4%. Non-banks at a more reasonable 90.7%

Based on today’s bank prices, the table below shows the estimated dividends (c) and yield. PLUS FRANKING.
FY 25% FY 26% FY27%
ANZ 161.00 4.84% 162.80 4.89% 163.8 4.92%
CBA 485.00 2.90% 501.40 2.90% 518.2 3.10%
NAB 170.00 3.86% 171.20 3.89% 167.8 3.81%
WBC 152.00 3.92% 155.00 4.00% 151.4 3.91%
MQG 650.00 2.96% 739.50 3.37% 801.25 3.65%

CBA yield is below all the others.

Dividend expectations for BHP and RIO. The forecasts below are for the full year.    Plus franking. Please note RIO is Calendar Year (CY). Cents per share (CPS).
   FY 25% FY 26% FY 27%
BHP 171.00 4.12% 176.60 4.26% 182.80 4.41%
RIO 560.80 4.57% 539.60 4.40% 583.00 4.76%

Other Indicators (changes since last Not So)
US VIX (Fear) Index decreased from 16.74 to 16.28.  Insidethe normal range. Normal is 10-17. Will see if this spikes with the with the Govt shut down (depends how long it lasts).
Iron Ore decreased from $105.95 to $103.55.  The average expectation for 2025 is $98.3.
Copper increased from $4.73 to $4.85. It reached an all-time high of $5.8955 on July 8.
Gold increased from $3778 to $3891. New ATH $3891 today.
AUD/USD increased from 65.41c to 65.98c.
Asian markets – UP
US 10-year Bonds decreased from 4.19% to 4.15%.  2-year rate 3.61%. 30 year rate below 5% at 4.73%.
German 10 year Bonds decreased from 2.78% to 2.72%.
Japanese 10 year Bonds remained at 1.65% . Highest for 18 years was 1.675%. 30-year Bond hit an ATH of 3.25%
Aussie Bonds 10 year Bonds increased from 4.29% to 4.34%.  Recent high 4.95%.
Oil prices decreased from $65.24 to $62.53. OPEC increasing production
The price of tungsten in China remained at $593mtu. The European price range increased from $570mtu to $650mtu to $580mtu to $650mtu. Prices are at an all-time high due to the Chinese continued export ban.

This Week & Next Week
Last, “Not So” opened in 7 Aust states (excl NT), 9 US states, Bulgaria, Sweden & UK.

This week – Out office – Friday (Ute Muster)
Next week – In office – October reviews.

Southern Highlands/Sydney/South Coast road trip Nov 7 to Nov 14.
Scott knee operation December 1.
PO BOX 149 Deniliquin NSW 2710
125 End St, Deniliquin, NSW 2710
Ph. 03 58950100
Fax 03 58950101
Mobile 0412113524
scottm@provincialwealth.com.au
kevinh@provincialwealth.com.au
chrisp@provincialwealth.com.au
maddyl@provincialwealth.com.au
karaw@provincialwealth.com.au

The Not So Daily Bulletin 3 September 2025 No.730

September 15, 2025 (updated September 15, 2025)

Top Stories

On Wednesday, September 3, 2025, the ASX fell 162 points to finish at 8739, its lowest point since 4/8/25.

This was the fourth down day in a row and continues September’s record of being a weak month (seasonal weakness), even though the second quarter GDP(announced today) was better than expected at 0.6%. Likely to see the RBA on hold in September.

According to Bell Potter’s Coppo report, a large seller was in the market all day (I’m not sure whether offshore or domestic). The selling was concentrated in the top 10 stocks, which represented 62% of the fall. CBA dropped to $164.55, its lowest price since 29/4/25.

The market always has issues of concern to consider, hence the saying that it climbs a wall of worry, as it has been doing since the fall in April (Liberation Day).

Apart from the September weakness, there is a risk that the issues of concern may provide the volatility we have been concerned about.

Things the markets are watching:
1. President Trump is pressuring the US Federal Reserve to drop interest rates (they meet on Sept 17) and looking to change board members.
2. Long Bond rates are pushing higher (30-year rates are all higher in the UK, Japan, Germany, and the US). This means more interest is paid on Government debt.
3. US Courts have said most of the President’s Tariffs are illegal. If the Supreme Court agrees, approximately $96 billion could be paid back. This will put further pressure on interest rates.
4. Signs are that global inflation is starting to push back up. This may stop interest rates from falling.
5. A global slowing economy due to uncertainty from trade relationships. The US big stick approach may be witnessing another big stick with the summit held in China (Shanghai Cooperation Organisation – SCO) over the weekend. This is the 25th meeting of this group, which included China, India, Russia, Pakistan, Iran and the other stans. Additionally, the meeting was attended by a raft of other countries, including Egypt, Turkey, Indonesia, Malaysia and Vietnam.
6. The price of gold is hitting a new all-time high of $3,616.90. Gold is known to be an investor’s safe haven.
7. Technology valuations have pushed US markets to near ALL-TIME HIGHS. However, valuations remain reasonable for growth companies. NVIDIA, detailed below, has a PE of 29, as does Apple. Google has a PE of 21. These are certainly not like the dot com boom valuations that saw PE in 100’s or even 1000’s. The only Magnificent 7 with a PE in that ballpark is Tesla, which has a PE of 175 and has fallen 18% this year.

None of these issues is new, and the market might decide that the benefits from lower interest rates, deregulation and the adoption of AI will provide more benefits than the list above.

That’s why we take a long-term view and don’t try to trade the market.

We will likely see more volatility in the coming weeks.

We are happy for you to share our Not So Daily Bulletin with family and friends, and if we can help them, we are also excited to chat.

Value from the Reporting Season

We have collated information from Morgan’s best ideas and Bell Potter regarding stocks in the CORE Watchlist.

1. CSL Ltd (CSL)
Morgans – Healthcare. Although a softer 2H Behring result and awkward restructuring timing may unsettle investors, we see the growth engine intact, with cost savings reinforcing the path to sustained double-digit earnings growth. We have a BUY rating on CSL with a blended DCF, PE and EV/EBITDA based target price of A$293.83. Price Target $293.83 Div.Yield 2.3% PE FY26 19x 2y EPSg 11.0%.

Bell Potter – Trading on a PE of 17.5 times FY27 (gave guidance of 7-10% NPAT growth for FY26, so I think they should do double-digit per annum EPS growth over the medium term). CSL’s Long Term PE average is closer to 25 times, so looks very compelling, as it trades below the market multiple at current, yet it’s a premium business.

2. Amcor (AMC)
Morgans – Industrial AMC is a highly defensive business with leading global market positions and experienced management. We expect the addition of Berry, along with potential divestments, to enhance AMC’s growth outlook and balance sheet over the medium term. While execution of synergy targets will be the key, AMC has a strong track record in integrating large-scale transactions. Price Target $15.20 Div.Yield 6.3% PE FY26 11x 2y EPSg 12.0%.

Bell Potter – Trading on a PE of 9.5 times FY27 (assuming all the synergies are realised with Berry) this is a standout buy! Yield over 6% FY27.

3. Woodside Energy (WDS)
Morgans – We remain bullish on WDS as a business. The jump in net debt rightly increases delivery risk, but on the positive side the hurdles for WDS to unlock material value upside from here align with where its well-established core strengths sit. If oil prices hold steady we expect a discount in WDS’ share price to persist in the short term until it reassures on its capex profile and/or secures LALNG selldown(s). We remain cautious on the short-term outlook for oil prices, if any volatility were to unfold it would likely offer an attractive opportunity to increase positions. Price Target $29.60 Div.Yield 5.4% PE FY26 21x 2y EPSg -5%

Bell Potter – Woodside are likely to have an earnings trough in FY26 with Scarborough production coming on at the end of 2026. BarrenJoey have earnings forecasts 50% higher than consensus for FY27 (see attached), and I think their numbers will be closer to correct over the medium term, as Trion production comes online in FY28 and Louisiana LNG in FY29, so there is going to be a big production uplift coming for the patient investor, and this should see the stock back in to the mid $30’s using a PE of 15, which is close to its long term average.

4. ResMed Inc (RMD)
Morgans – Healthcare While weight loss drugs have grabbed headlines and investor attention, we see these products having little impact on the large, underserved sleep disorder breathing market, and do not view them as category killers. We view RMD’s overall fundamentals as sound, with profitability improving as margins expand. Price Target $47.86 Div.Yield 0.9% PE FY26 25x 2y EPSg 9.3%

5. Goodman Group (GMG)
Morgans – Property GMG is a global industrial property group with a focus on infill sites across gateway markets. GMG actively manages its portfolio, growing Assets Under Management (AUM) and adding value through a buy, build, manage strategy. We view GMG as a high-quality, founder-led business with a robust balance sheet and a portfolio of Agrade data centre and industrial assets. Whilst uncertain, we see the opportunity in GMG’s 5GW powerbank and its capacity to see sustained earnings growth as development yields improve. Price Target $38.40 Div.Yield 0.9% PE FY26 26x 2y EPSg 13.0%.

6. Orica (ORI)
Morgans – Industrials ORI is now not only the world’s largest explosives company, but it is also the global leader in geotechnical and structural monitoring in mining and civil infrastructure and the world’s largest producer of sodium cyanide. ORI is leading the industry with its technology offering. Importantly, this area is high growth and high margin work. ORI is set to deliver solid earnings growth over coming years reflecting strong demand, recontracting benefits, further mix/margin benefits and strong growth from Digital Solutions and Specialty Mining Chemicals. Management continues to execute well and has a solid track record. ORI is trading on attractive multiples which are at a discount to its 5-year average. Price Target $21.70 Div.Yield 4.6% PE FY26 12x 2y EPSg 11.2%.

7. Orora (ORA) –
Bell Potter – Looks interesting with the company winning market share in their SaverGlass business (earnings seem to have bottomed here) with $50M of EBIT to flow through to their cans business from FY26, as they finish Rocklea expansion. Good buying in the low $2.00’s, as I think when their buyback finishes this year they are likely to launch another buy back due to the health of their balance sheet and this should see their earnings lift significantly. I think it will trade on a market multiple medium term, so EPS 16 cents FY27 multiplied by 18 equates to $2.88. Market is worried there is a structural decline in alcohol consumption, but the company is confident that SaverGlass is in a growth segment of premium spirits and wines.

NVIDIA – the largest company in the world

NVIDIA (semi-conductors) is now clearly the largest company in the world, valued at $4.15 trillion. It had been battling Microsoft with a value of $3.75 trillion and Apple with a value of $3.41 trillion for that honour.

NVIDIA is one of the most influential and innovative companies in the global technology landscape, especially in the era of artificial intelligence (AI), accelerated computing, and high-performance graphics. However, most people haven’t heard of it, let alone what it does. I have asked Co-pilot for a brief explanation.

NVIDIA began as a graphics processing unit (GPU) manufacturer in 1993, and its invention of the GPU in 1999 revolutionised computer graphics and gaming. Today, it is a full-stack computing infrastructure company that provides:
GPUs for gaming, professional visualisation, and data centres.AI hardware and software, including supercomputers and microservices for AI model deployment.
Software platforms like CUDA (a parallel computing model), Omniverse (for digital twins), and Clara (for healthcare AI).
Specialised systems for autonomous vehicles (NVIDIA Drive), robotics (Jetson), and edge computing.

NVIDIA is central to the AI revolution:
It powers AI factories—data centres optimised for training and deploying AI models.
Its chips are used in large language models, robotics, autonomous vehicles, and medical imaging.
Over 40,000 companies use NVIDIA AI technology, and its CUDA platform has over 53 million downloads.
In July 2025, NVIDIA became the first publicly traded company to surpass a $4 trillion market valuation, underscoring its dominance and investor confidence in its role in shaping the future of tech.

Broader Impacts
Gaming: Over 200 million gamers use NVIDIA GeForce GPUs.
Healthcare: AI frameworks like MONAI are transforming medical imaging.
Robotics & Autonomous Vehicles: NVIDIA powers all top autonomous vehicle data centres and supports over 1.7 million robotics developers.
Sustainability: Accelerated computing with NVIDIA chips could save nearly 30 trillion watt-hours of energy per year compared to traditional CPU-based systems.
Would you like a visual summary or a timeline of NVIDIA’s evolution and milestones?

Below is a graph of NVIDIA’s revenue breakdown per quarter since Q4FY21. The light green is the revenue from computer gaming, which has increased from $2.4bn to $4.3bn over the five years. However, the growth has been in the dark green data centres, which have seen revenue increase from $1.9bn in Q4FY21 to a whopping $41.1bn in Q2FY2026.

The second graph shows where the revenue comes and goes. A total of $46bn for the quarter saw cost and operating expenses equate to $18.3bn and tax of $4.8bn, which means the Net Profit After Tax is $26.4bn for the quarter or 57c in every $1 of revenue.

NVIDIA is part of a raft of ETFs we use: IVV, NDQ, QUAL, QHAL, RBTZ, IOO & SEMI

Ongoing Fee Agreement – some need Reissuing
Notification for Provincial Wealth clients
As of 10 January 2025, new legislation has streamlined how financial advisers manage ongoing fee arrangements (OFAs). The annual Fee Disclosure Statement (FDS) has been removed, and a single consent form now covers both the renewal of your advice arrangement and authorisation for fees to be deducted from your account. This form must include specific details such as the services provided, fee amounts, account information, and your reference date. We started using these changes in May 2025.
We have just been notified that the OFAs used since May don’t meet the requirements set by ASIC. The Financial Advice Association Australia (FAAA) and ASIC have acknowledged that this is a widespread problem across the advice industry.

As a result, we’ll be reaching out to affected clients to update and reissue their OFAs to ensure full compliance. ASIC has provided temporary relief for some of these issues, but we’re taking proactive steps to ensure everything is correct and transparent. If you receive a request from us to review or re-sign your arrangement, please know it’s part of our commitment to keeping your financial advice aligned with the latest regulations. Please note the fees haven’t changed.

Financial Planning Snippets
PLEASE BE VIGILANT regarding financial scamming. If anyone is requesting financial information from you (via phone, email, text, or social media), please contact us first or ask them for their ABN.
Super Guarantee (SGC) for employees increases to 12% from 1/7/25.
Concessional super contributions maximum of $30k
Commonwealth Seniors Health Care card has seen the income limit increase to $158,440 (couple) $99,025 (single). If you are of Age Pension age and don’t have the card, please let us know.

Age Pension Deeming rates change.
The deeming rate for Aged pension calculations will change from 20 September.

Financial assets are deemed to earn a specific rate of income when being assessed for Aged Pension.

For a single, the first $64,200 and for a couple, the first $106,2000 is deemed to earn 0.25%. This is being increased to 0.75%.

The assets above these are amounts are deemed to earn 2.25%. This will be increased from 2.75%.

For the vast majority of people on Aged Pension it will have litle or no impact.

If you have any questions, please let us know.

Other Stories
Macquarie reduced interest rates after the RBA cut. CMA 2%, Accelerator 3.9%.
– The US Court ruled on Google’s antitrust case, saying Google doesn’t have to be broken up. This saw Google up 7% and Apple 3% after the US market closed.

Broker Target Price Changes

Target Prices should be viewed as a compass (the general direction) rather than a GPS destination.

Ord Minnett
Computershare (CPU) increased from $42 (highest broker) to $43.60 (still highest broker)
Lend Lease (LLC) increased from $5.85 (lowest broker) to $5.90 (equal lowest broker)
Orora (ORA) decreased from $2.30 to $2.20
Sonic Health (SHL) decreased from $26.50 to $24.50 (lowest broker)

Morgans
Telstra (TLS) increased from $4.70 (lowest broker) to $4.80

Morgan Stanley
BHP increased from $43.50 to $46.50 (highest broker)
Goodman Group (GMG) increased from $40.57 (highest broker) to $41.50 (still highest broker)
Rio Tinto (RIO) increased from $118 to $121 (equal highest broker)
Seek.com (SEK) increased from $30 to $32.50

Macquarie
Westpac (WBC) increased from $27.50 to $30

Bell Potter/Citigroup

UBS
WBC increased from $36 (highest broker) to $38 (still highest broker)

Tracking changes for 2025
Upgrades 271
Downgrades 230

Core Watchlist Index (changes since last Not So)

The CORE Watchlist is a collection of 30 Australian shares, predominantly “Blue Chip”. We obtain research from up to 6 brokers on each share. Each broker provides a Target Price (value in 12 months) which then provides us with an average for each stock. We then compare that average to the current price as a percentage. IE Macquarie price $176.95 Av. Target Price $205.96= 85.9% (meaning 14.1% upside over next 12 months) + income 4.35% (including franking).

To get the CORE Index we take the average across the 30 stocks. This provides us with a market average as there are up to 80 teams of analysts providing the research and target prices. The CORE Watchlist stocks represent more than 55% of the ASX 200 and so provide us with a good indicator of the market value. When it’s at 100% then the market is fully priced. We have seen that when the index is below 90%, then it’s good buying, but that doesn’t happen very often. Should you have any questions, please let me know.

The Core index decreased from 98.20% to 96.27%. If we removed the 4 banks, the index falls to 92%

Overall Earnings Per Share (EPS)
FY25 increased from 1.20% to 2.21%
FY26 decreased from 7.93% to 6.17% (new low)

Most expensive – CBA 143.2% (176.5% highest ever).
Least expensive – CSL 71.3%.

The CORE Watchlist has 6 (9) stocks trading above 100%; they are; ANZ CBA JBH NAB WBC WES lowest number ever is 0, highest is 15. While 7 (4) is trading below 85% (the highest is 18, and the lowest is one). AMC CSL LLC NXT S32 SEK SHL (Figures in brackets are last Not So).

STOCKS TRADING BELOW ALL BROKER FORECASTS ARE AS FOLLOWS; (it has been a handy indicator in the past). 12 out of the 30 CORE stocks are trading below the lowest broker target price. Highest 24. Lowest is 2.

ALL current price $69.04 Broker range $70 to $76
AMC current price $12.78 Broker range $14.20 to $18.25
CSL current price $206.62 Broker range $258 to $300
GMG current price $32.26 Broker range $32.50 to 41.50
LLC current price $5.43 Broker range $5.90 to $7.12
NXT current price $16.48 Broker range $18.00 to $22.10
RMD current price $41.60 Broker range $47.86 to $49
S32 current price $2.63 Broker range $2.70 to $3.95
SEK current price $26.61   Broker range $30 to $32.50
SHL current price $22.74 Broker range $24.50 to $29.40
STO current price $7.83 Broker range $8.50 to $8.88
WOW current price $27.15 Broker range $28.25 to $33

Added ALL SHL STO WOW
Removed

Banking Index (changes since last Not So)

Like the CORE Watchlist index, the Banking index is the four major banks’ average target price based on research from up to 6 brokers. The percentage below 100% is the potential upside over the next 12 months (not including income). If at or over 100%, then this indicates the Banks are fully priced.

The banking index decreased from 127.1% to 123.2%.

Based on today’s bank prices, the table below shows the estimated dividends (c) and yield. PLUS FRANKING.

FY 25 % FY 26 % FY 27 %
ANZ 164.00 5.01% 162.00 4.95% 162.2 4.95%
CBA 485.40 2.95% 501.40 2.95% 518.2 3.15%
NAB 170.00 4.05% 171.20 4.08% 167.8 4.00%
WBC 152.00 4.09% 155.20 4.18% 151.6 4.08%
MQG 650.00 2.92% 739.50 3.32% 801.25 3.60%
CBA yield is below all the others.

Dividend expectations for BHP and RIO. The forecasts below are for the full year.    Plus franking. Please note RIO is Calendar Year (CY). Cents per share (CPS).
   FY 25 % FY 26 % FY 27 %
BHP 171.00 4.07% 170.20 4.06% 176.60 4.21%
RIO 541.40 4.77% 541.40 4.77% 566.20 4.99%

Other Indicators (changes since last Not So)
US VIX (Fear) Index increased from 15.36 to 17.17.  Inside the normal range. Normal is 10-17.
Iron Ore decreased from $103.40 to $102.45.  The average expectation for 2025 is $98.3.
Copper increased from $4.54 to $4.56. It reached an all-time high of $5.8955 on July 8 .
Gold increased from $3553 to $3595. New ATH $3616.90 occurred today.
AUD/USD decreased from 65.42c to 65.10c.
Asian markets – MIXED
US 10-year Bonds increased from 4.23% to 4.29%.  2-year rate 3.66%. 30 year rate below 5% at 4.99%.
German 10 year Bonds increased from 2.73% to 2.78%.
Japanese 10 year Bonds increased from 1.62% to 1.63% . Highest for 16 years was 1.632%. 30-year Bond hit an ATH of 3.25%
Aussie Bonds 10 year Bonds increased from 4.33% to 4.42%.  Recent high 4.95%.
Oil prices increased from $63.73 to $65.36. Increased on increased Iranian sanctions
The price of tungsten in China increased from $503mtu to $513mtu. The European price range remained at $495mtu-$545mtu. Prices are nearing an all-time high.

This week & next week
Last, “Not So” opened in 7 Aust states (excl NT), 5 US states (California, Massachusetts, Delaware, Virginia & South Carolina), Bulgaria, Sweden and a new country visited by a Not So reader. Country 51 Portugal (Lisbon).

This week – In Office
Next week – In Office except Sept 11.

PO BOX 149 Deniliquin NSW 2710
125 End St, Deniliquin, NSW 2710
Ph. 03 58950100
Fax 03 58950101
Mobile 0412113524

scottm@provincialwealth.com.au
kevinh@provincialwealth.com.au
chrisp@provincialwealth.com.au
maddyl@provincialwealth.com.au
karaw@provincialwealth.com.au

The Not so Daily Bulletin 13th August 2025 No. 725

August 14, 2025 (updated August 14, 2025)

Top Stories

On Wednesday, August 13 2025, the ASX fell 54 points to finish at 8827. This is after hitting a new all-time high yesterday, closing at 8880.80. This is the 14th ATH in 2025.

Today, CBA released their results, which were $10bn profit and a slight increase in the dividend; however, this wasn’t enough for the market, which had previously pushed the price to a point where CBA is the most expensive bank in the world. CBA fell 5.4%, taking the other banks with it. As we have noted for some time, the banks are trading well above the analysts’ forecasts, so we are not surprised by the pullback today. The turnover in CBA shares was a large $750m, one of the year’s largest trading days. We will see what the analyst says tomorrow, with all six having SELL recommendations.

In this reporting season, we’ve seen several stocks take a hit once they delivered their results. Over the last week, on releasing results, QBE fell 8%, Computershare (CPU) fell 4%, AGL fell 12%, JB HiFi (JBH) fell 8% & CBA fell 5.4%. This would suggest that if the company doesn’t deliver above expectations, you could see some selling, especially as valuations are at the higher end of normal. As suggested last month, the market might be switching from banks to resources. Since 30/6, CBA down 8% and Aust Bank ETF (MVB) down 4% while BHP up 13%, Woodside (WDS) up 13%, RIO 10% and Aust Resources ETF (MVR) up 10%.

US markets have taken the uptick in inflation well, as it’s not as bad as feared and it could allow the US Federal Reserve to cut interest rates next month. The RBA cut rates yesterday in Australia to 3.6% with the likelihood of more to come.

We will likely see more volatility in the coming weeks.

We are happy for you to share our Not So Daily Bulletin with family and friends, and if we can help them, we are also happy to chat.

RBA Interest Rates
As predicted by Kevin “interest rate whisperer” Hanson, the RBA cut interest rates by 0.25% to 3.6%. The RBA sees inflation running around target, but has revised its growth forecasts down again. Its forecasts assume that the cash rate will continue to “follow a gradual easing path,” implying that without further easing, growth and inflation will be lower and unemployment higher.
AMP’s Shane Oliver expects the RBA to cut again in November, February, and May, taking the cash rate to 2.85%.

The ongoing rate-cutting cycle should help underpin a modest increase in Australian economic growth to around 1.8%yoy by year-end, but with the tariff threat posing some downside risk.

The media tends to focus on the benefits or costs for mortgagees when interest rates move. However, only 35% of Australian households have a mortgage. 32% have no mortgage, and 33% rent. While an interest rate cut is suitable for those who have debt, there is never any commentary on how a saver just took a drop in their income, as they will receive less interest.

US Inflation & Tariffs
US inflation results released last night were as expected. Headline was up 0.2% or 2.7% over the year, and the more important CORE was up 0.3% or 3.1% over the year. While this sees inflation moving up and above the 2% target from the US Federal Reserve, the market thinks it’s low enough for the US Federal Reserve to cut interest rates at the next meeting on September 17.

The main inflation component has been services (blue), which has moved sideways for the last couple of months, while goods inflation (green) ticked up for the 2nd month due to tariffs. Most economists say companies are still running their pre-tariff inventory, so the tariffs’ effects are yet to show. Additionally, the changing decisions regarding tariffs have seen many not instigated until this month. So there are more tariff impacts to come, but that could also dilute the effect, as not all are happening at once.

China’s tariff decision was postponed another 90 days yesterday.

The US budget deficit figure was released last night. The July deficit increased to $219bn after showing a surplus in June. The tariffs increased to $21bn, with most being paid by the company at this stage.

Aussie Reporting Season
Results are coming out on the following dates for the CORE Watchlist companies

30 July Rio Tinto (RIO) reported resilient half-year results with $4.5 billion net profit, supported by strong copper and aluminium performance despite lower iron ore prices and cyclone disruptions.

1 Aug ResMed (RMD) delivered a 37% increase in net income to $1.4 billion for FY25, driven by 10% revenue growth and expanding margins across its sleep and digital health businesses

11 Aug JB Hi-Fi (JBH) reported strong FY25 results with net income of $459.9 million, driven by solid sales and a final dividend of $1.83 per share.

13 Aug Commonwealth Bank (CBA) posted a record $10.25 billion cash profit, up 4% from FY24, supported by lending growth and a final dividend of $2.60 per share.

Computershare (CPU) delivered a 15% increase in Management EPS and boosted its dividend by 14%, reflecting strong performance across its core businesses

14 Aug ORA TLS WBC
16 Aug SEK
18 Aug LLC NAB
19 Aug BHP CSL WDS
20 Aug TCL STO
21 Aug BXB GMG SHL
26 Aug COL
27 Aug WOW
28 Aug S32 WES

Financial Planning Snippets
PLEASE BE VIGILANT regarding financial scamming. If anyone is requesting financial information from you (via phone, email, text, or social media), please contact us first or ask them for their ABN.
Super Guarantee (SGC) for employees increases to 12% from 1/7/25
Concessional super contributions maximum of $30k
Commonwealth Seniors Health Care card has seen the income limit increase to $158,440 (couple) $99,025 (single). If you are of Age Pension age and don’t have the card, please let us know.

Non-concessional Contributions (NCC)
NCC are after-tax contributions made to your superannuation fund, and they play a key role in boosting retirement savings. For the 2025–26 financial year (FY26), the annual non-concessional contributions cap remains at $120,000

There is also a bring-forward arrangement, allowing up to $360,000 in non-concessional contributions over a three-year period, provided certain conditions are met.

Those conditions have had changes made for this financial year as shown in the table below.

If your super balance was below $2m as of 30/6/25, you can still make an NCC. This has increased from $1.9m.

If your super balance is below $1.88m you can make a contribution up to $240k (2 years bring forward). This has increased from $1.78m

If your super balance is below $1.76m you can make a contribution of up to $360k (3 years bring forward). This has increased from $1.66m

If your balance equals or exceeds $2 million at the end of the previous financial year, your non-concessional contributions cap is reduced to $0, meaning you cannot make further non-concessional contributions.

This assists in growing super balances and generating future tax-free income, where $2m is now the amount that can be used to start a tax-free pension (Account-Based Pension). The NCC also assists in the re-contribution strategy as we are able to withdraw from pension and re-contribute as NCC, which is considered a tax-free component. This assists with future estate planning.

Other Stories
– ETFs had a record monthly inflow of $5.9bn.
– Tyro payments received an unsolicited takeover bid.

Broker Target Price changes
Target Prices should be viewed as a compass (the general direction) rather than a GPS destination.

Ord Minnett
JB Hi-Fi (JBH) increased from $89 to $97

Morgans
CBA decreased from $97.49 (lowest broker) to $97.40 (still lowest broker).
JBH increased from $92 to $95

Morgan Stanley
BHP decreased from $44 (highest broker) to $43.50
JBH increased from $73.60 (lowest broker) to $83.40 (still lowest broker)
South 32 (S32) decreased from $3.55 to $3.45

Macquarie
JBH increased from $112 to $118
Woodside (WDS) increased from $24 to $27.50

Bell Potter/Citigroup
Brambles (BXB) increased from $20.15 to $23.60

UBS
JBH increased from $95 to $112
South 32 (S32) decreased from $3.20 (lowest broker) to $3.10 (still lowest broker)

Tracking changes for 2025
Upgrades 207
Downgrades 186

Core Watchlist Index (changes since last Not So)
The CORE Watchlist is a collection of 30 Australian shares, predominantly “Blue Chip”. We obtain research from up to 6 brokers on each share. Each broker provides a Target Price (value in 12 months) which then provides us with an average for each stock. We then compare that average to the current price as a percentage. IE Macquarie price $176.95 Av. Target Price $205.96= 85.9% (meaning 14.1% upside over next 12 months) + income 4.35% (including franking).

To get the CORE Index we take the average across the 30 stocks. This provides us with a market average as there are up to 80 teams of analysts providing the research and target prices. The CORE Watchlist stocks represent more than 55% of the ASX 200 and so provide us with a good indicator of the market value. When it’s at 100% then the market is fully priced. We have seen that when the index is below 90%, then it’s good buying, but that doesn’t happen very often. Should you have any questions, please let me know.

The Core index decreased from 100.12% to 99.66%. Fell below 100% for the first time in 5 days. If we removed the 4 banks, the index falls to 95.62%

Overall Earnings Per Share (EPS)
FY25 decreased from 1.13% to 0.95%
FY26 increased from 8.14% to 8.26%

Most expensive – CBA 154.6% (176.5% highest ever).
Least expensive – NextDC (NXT) 74.2%

The CORE Watchlist has 12 (10) stocks trading above 100%; they are; ANZ BXB CBA CPU JBH NAB RIO TCL TLS WBC WDS WES, lowest number ever is 0, highest is 14. While 3 (5) is trading below 85% (the highest is 18, and the lowest is one). CSL LLC NXT (Figures in brackets are last Not So).

STOCKS TRADING BELOW ALL BROKER FORECASTS ARE AS FOLLOWS; (it has been a handy indicator in the past). 7 out of the 30 CORE stocks are trading below the lowest broker target price. Highest 24. Lowest is 2.

ALL current price $69.70 Broker range $70 to $76
CSL current price $265.53 Broker range $303.70 to $347.30
LLC current price $5.42 Broker range $5.85 to $7.79
NXT current price $14.53 Broker range $18.00 to $22.10
RMD current price $43.55 Broker range $47.86 to $49
S32 current price $3.06 Broker range $3.20 to $4.10
SEK current price $25.07 Broker range $25.50 to $30.10

Added ALL
Removed BHP

Banking Index (changes since last Not So)
Like the CORE Watchlist index, the Banking index is the four major banks’ average target price based on research from up to 6 brokers. The percentage below 100% is the potential upside over the next 12 months (not including income). If at or over 100%, then this indicates the Banks are fully priced.

The banking index decreased from 128.2% to 126.4%. It hit a near-record 130.1% yesterday.

Based on today’s bank prices, the table below shows the estimated dividends (c) and yield. PLUS FRANKING.
FY 25 % FY 26 % FY27 %
ANZ 164.00 5.15% 162.00 5.08% 162.2 5.09%
CBA 484.20 2.86% 499.60 2.86% 515.4 3.05%
NAB 170.00 4.45% 170.20 4.46% 165.4 4.33%
WBC 152.00 4.48% 155.20 4.58% 148.6 4.38%
MQG 650.00 3.04% 739.50 3.46% 801.25 3.75%

CBA yield is below all the others.

Dividend expectations for BHP and RIO. The forecasts below are for the full year. Plus franking. Please note RIO is Calendar Year (CY). Cents per share (CPS).
FY25 % FY26 % FY27 %
BHP 153.83 3.69% 155.50 3.73% 167.00 4.00%
RIO 541.40 4.59% 538.60 4.57% 563.40 4.78%

Other Indicators (changes since last Not So)
US VIX (Fear) Index decreased from 16.77 to 14.73.  Fell into the normal range. Normal is 10-17.
Iron Ore increased from $101.95 to $104.40.  The average expectation for 2025 is $98.3.
Copper increased from $4.42 to $4.52. ALL TIME HIGH of $5.8955 on July 8.Gold decreased from $3446 to $3398. ATH $3509.90.
AUD/USD increased from 65.11c to 65.3c.
Asian markets – UP with Japan hitting new highs.
US 10-year Bonds increased from 4.25% to 4.28%.  2-year rate 3.73%. 30 year rate back below 5% at 4.86%.
German 10 year Bonds increased from 2.66% to 2.73%.
Japanese 10 year Bonds increased from 1.49% to 1.52%. Highest for 16 years was 1.601%.
Aussie Bonds 10 year Bonds decreased from 4.25% to 4.23%.  Recent high 4.95%.
Oil prices decreased from $64.80 to $63.17.
Tungsten—China price increased from $463mtu to $473mtu. The European price range remained at $475-$495mtu (highest price for 13 years).

This week & next week
Last, “Not So” opened in 7 Aust states (excl NT), 6 US states (California, Massachusetts, Colorado, Virginia, New Jersey & Ohio ), Bulgaria and Sweden.

This week – In Office – August reviews
Next week – In Office -apart from Tuesday (Wagga) – August reviews.

The Not So Daily Bulletin 16th July 2025 No. 720

July 17, 2025 (updated July 17, 2025)

Top Stories

On Wednesday, July 16, 2025, the ASX fell 69 points to finish at 8562. This is after the ASX 200 hit a new ALL-TIME CLOSING HIGH (ATH) of 8630.3 yesterday, which was just shy of the ATH intraday of 8639.10.

The US markets saw new ATHs from the S&P 500 and NASDAQ overnight, with NVIDIA driving most of the gains. With an increase of 4% to a new high, the company was valued at US$4.16 trillion after CEO Jensen Huang visited the White House and gained approval to sell semiconductors (computer chips) to China. However, there were broader concerns from the US inflation figures, which gave a slight uptick from the tariffs.

US banks started the US quarterly reporting season last night with mixed results, which might set the tone of the upcoming reporting season in the US and Australia, as the results may be inconsistent within sectors. We are now entering the profit confession season, where companies are signing off on their June 30 results, and they have to make sure the market is informed.

Earlier this week, China announced its exports had increased 5.8% in June after allowing for a 16.1% drop in exports to the US. In short, China is still growing, as shown by its GDP result yesterday, which increased 5.2%, and it is looking for other trade opportunities. Just to let you know, as noted in the UBS note below, the US only represents 16% of global trade.

We previously mentioned that China kept its powder dry to wait for Trump’s trade deal. This is causing growing global confidence that China could withstand a trade war with the US. This might also explain why iron ore has rebounded from near $90 to near $100.

The bond markets are still reasonably calm, but did increase after the inflation numbers last night.

We will likely see more volatility in the coming weeks. For the first time this year, the brokers have decreased the target prices for the CORE Watchlist (30 stocks) more than increased.

We are happy for you to share our Not So Daily Bulletin with family and friends, and if we can help them, we are also happy to chat.

US Inflation

US inflation released last night was slightly higher at 2.9% headline and 2.7% core. The markets have been expecting some inflation impact from the tariffs, which has also kept US Federal Reserve chair J. Powell from cutting rates.

The results were OK, but could be read in many different ways.

It shows that the tariffs haven’t had an impact on inflation over the last couple of months. The goods (green) inflation hasn’t been seen with a slight uptick in this month’s figures, but the inflation figure increased rather than continued the recent downtrend. This suggests a couple of things.
1) The exporters are absorbing tariffs.
2) The US supply chain businesses are absorbing the tariffs.
3) Retailers are selling pre-tariff goods from inventories and haven’t started passing on the higher prices yet to the consumers.

Most economists suggest it will take 3 to 6 months for the tariffs to impact prices as goods work their way through the supply chain.

The other observation from the inflation chart below is that services inflation (blue) has stalled at 2%.

Tonight, the US releases the PPI (producer price index). This may give further signals about where the tariffs are impacting the supply chain.

Global Equities

UBS research summarised
UBS expect consolidation near term in equities (until mid-September).
Concerns being:

i) UBS Risk Appetite is just above neutral.
ii) Earnings downgrades are likely, UBS has EPS growth of 7% in ’25E. as US GDP growth slows from 1.8% YoY in Q2 to 0.9% YoY in Q4.
iii) The US Fed doesn’t restart a cutting cycle until September 17th. Hence, weak economic data will likely be taken as bad news.
iv) August and September are the worst two months of the year. UBS would be surprised if the consolidation phase brought more than 5% downside.

UBS would buy into this and raise the year-end forecast to 960 MSCI World AC = c4% upside (from 940 MSCI AC World) and introduce a year-end target of 1000 MSCI World for end-2026 = 8% upside.

What is supportive, outside of a tariff discussion?
i) fiscal and monetary policy easing outside the US has resulted in a downgrade to global GDP of just 10bp since April 1st for 2025 and 2026, when taken together.
ii) US wage growth is very well behaved. This not only helps profit margins but, more importantly, market expectations for inflation, allows the Fed to cut by 1% by year-end starting in September
iii) some exceptionalism in the P/E is normal at this stage of the cycle. If the relationship between credit spreads and P/E stays in its post-’22 range, then the ‘fair value’ P/E is c23x (using 12-month forward) = c6,600 S&P 500. Perceived productivity improvements from Gen AI only add to this:
iv) historically, if markets just avoid a bear market (as was the case in mid-April), then 1 year later they are up an average of 34%, cf to 25% so far.

From here UBS are reasonably relaxed about the impact of tariffs because:
i) as above, the policy response is offsetting much of the hit to global GDP;
ii) the fiscal boost from the ‘BBB’ adds c0.45% to GDP over the next 6 quarters and offsets about around half the US GDP hit from tariffs – the CBO estimates that the revenue raised from tariffs covers 85% of the cost of the BBB;
iii) the US is only 16% of global trade;
iv) Some other regions are reducing trade barriers with each other. We think that there are good logical reasons to expect no major hike in tariffs from here.

UBS up the probability of a Bubble scenario to 25% for end-2026 and acknowledge a risk that this is too low. UBS has 6 out of 7 preconditions for a bubble. The only major one missing is benign monetary conditions, but if UBS forecasts for the Fed are borne out, then UBS get all 7.

Into bubbles, historically 30-43% of market cap has traded up to a P/E of 45x -72x on a 10-year bond yield of 5.5% to 6.4%. We are far removed from this with the Mag 6 (excl Tesla) on a P/E of 33.5x 12-month trailing. Into a bubble,MSCI AC World rises by c20%, at least. The ‘justification’ for a bubble would be either Gen AI being perceived to increase productivity by 2% from 2028 (which gives c 20% upside by end-’26 in the Equity Risk Premium model) or corporate balances being less risky than normal against government balance sheets.

Australian Banks

Macquarie research updated Bank research.

Offshore investors have taken over from Super in buying banks:
Over the last 6-months the primary source of net-buying of banks has shifted from domestic institutions (largely superannuation funds) to offshore investors. Macquarie thinks this reflects a few factors including:
(1) super funds already implementing bank ‘overlays’ to manage underweights,
(2) super allocations to Australian equities peaking in Sep-24,
(3) offshore investors looking for tariff safe-havens and betting on a weaker USD.

Looking forward Macquarie see several key risks to these positioning trends which have supported banks including;
(1) super funds turning negative on the bank sector,
(2) a return of unlisted activity and increased preference for offshore investments seeing allocation to Australian equities fall,
(3) US regulatory easing unlocking billions in capital returns, seeing global financial investors fund US bank buying with Australian banks, where
capital returns have already played out. This combined with downside risk to FY25E/FY26E earnings should drive banks underperform.

• Following the flows:
Bank share registry data suggests offshore and domestic investors remain buyers of the banks in the Jun-25 quarter. With international institutions buying ~$2.7bn of bank shares, the highest since Mar-20, while domestic institutions bought ~$700m. International institutions largely bought CBA (~$2.2bn), while Domestic institutions bought NAB (~$600m) and WBC (~$300m).
.
• Macquarie proprietary flows data: Our proprietary data supports this with offshore investors continuing to buy financials since March, with strong flows into CBA and NAB in particularly.

• US ADR volumes at record high: May saw record traded volume (and value) in US listed ADRs of ANZ, CBA and NAB, with a combined A$1.5bn traded. This saw ADR volumes a record 7-9% share of ASX volumes. While difficult to confirm, we think much of this flow was driven by currency views aiming to take advantage of a depreciating US Dollar and end of ‘American Exceptionalism’.

• Who else has been buying? Retail investors continued to be net sellers of banks in the June quarter, with selling activity in CBA, NAB and WBC, but buying of ANZ. Domestic investors remain overweight NAB, and increased their positions for the first time since Jun-24, they remain neutral WBC. International investors remain underweight CBA, but their underweight position is now at a record low. Short interest decreased across all banks, except BEN and JDO, with CBA’s short interest now broadly in-line with major bank peers

Resources

Morgans research updated on resources

BHP
We have a BUY recommendation on BHP, with a A$43.90 target price (SOTP DCF). The group pairs sector-leading balance sheet strength with exposure to copper and potash growth that is not fully captured in consensus numbers. A 5%+ forward dividend yield, underpinned by robust earnings strength, supports total shareholder return. That said, softer near-term iron ore pricing and a healthy valuation cap immediate upside, so we favour building positions on market pullbacks. Longer term, sustained free cash flow, rising copper output and further potash expansion should unlock further value. Key risk to our call is primarily global/regional macro driven (metal prices), and secondly execution on potash and copper growth.

Rio Tinto
RIO is under a HOLD recommendation, with a A$109ps target price (SOTP DCF). The miner’s strong balance sheet and diversified earnings base support an abovemarket forward dividend yield that we see as underpinned for the next 12 months. However, Pilbara execution risks around volumes, PB fines quality and unit costs, plus geopolitical overhangs in Mongolia, Guinea and Canada, weigh on near-term sentiment. In addition, non-growth capex looks to have peaked at a high watermark, yet its elevated run-rate threatens medium-term free cash flow and dividend capacity, particularly as RIO ramps up investment in lithium. With a share price near fair value we await clearer operational delivery before turning more constructive. Key risk to our call remains sensitive to execution performance on critical mine replacement projects in the Pilbara; political/country risk in Mongolia, Guinea and Canada (US tariffs); and global macro growth risk (metal demand drivers).

South 32
We have S32 on a BUY, with a A$4.10 target price (DCF SOTP). The company offers true commodity diversity, with a high weighting to base metals, without the iron ore cyclicality that dominates its larger diversified mining peers. S32 trades at a clear discount to NAV and historical EV/EBITDA multiples, presenting compelling value upside. While near-term catalysts are thin, and next month’s Mozal impairment could weigh on sentiment, we see this as an incremental negative rather than thesis-changing. We expect patient investors will be paid to wait via a sturdy balance sheet and sustainable dividends. Key risks to our call are global/regional growth (base metal demand drivers), and execution on Hermosa project developments.

Woodside
We have WDS on a BUY recommendation. Operational discipline continues to shine, with unit costs consistently beating guidance and peers in recent periods, underpinning a robust 6-7% forward dividend yield. The planned partial selldown of Louisiana LNG in 2H25 should crystallise value, further delever the balance sheet and fund organic growth, providing a clear near-term catalyst path. Trading on a healthy discount to smaller-peer STO in P/NAV and EV/EBITDAX, the stock offers compelling upside to our A$31.00 target price (SOTP DCF). While oil price volatility remains a risk, WDS’s tier-one assets and proven capital discipline leave us high-conviction buyers. Key risks to our call are execution risk on LALNG development, Scarborough construction and oil/LNG market outlook.

Lend Lease (LLC)

Citigroup note today summarised

We note the announcement from LLC this morning around the win of a >A$2.5bn gross end value development project at 175 Liverpool Street in Sydney. LLC plans to build 300 luxury apartments and 2,000sqm of retail space. We have previously highlighted new project wins as catalysts for LLC, and therefore see today’s announcement as a positive, as it helps provide visibility for future development earnings. The project is targeted to start in FY27 and complete in CY30, and LLC expects to announce a 50% selldown in the coming weeks to a capital partner.

Below, we also highlight a range of other projects that LLC is working on that could possibly provide future earnings visibility, and a win of any of these could be a potential catalyst, in our view. We retain Buy on LLC.

Based on our research of various articles, we highlight a range of potential future projects that could contribute to LLC’s development pipeline and earnings into the future.

• Hunter Street Overstation development – LLC, MGR and Justin Hemmes backed a hospitality group (Merivale), which have formed the Metropolis consortium together, are close to winning the project as one of the rival bidders, Brookfield, has pulled itself out of the process.

• Athletes Village development – LLC’s Brisbane Showgrounds had been announced as the location for the 2032 Brisbane Olympics Athletes Village, which is expected to accommodate more than 10,000 athletes, and will become residential post the Olympics.

• Blackwattle Bay development – LLC and 2 competitors were shortlisted last year for the Blackwattle Bay redevelopment in Sydney, which is expected to have 1,100 homes.

• Arden Central Precinct in Victoria – LLC and 3 competitors have been shortlisted by Development Victoria in a multi-stage process to select a development partner for the Arden Central precinct.

Exchange Traded Funds (ETF)

ETFs are a collection of investments. They usually pay an income payment either half-yearly or yearly. Today, most ETFs trade ex-dividend, which means they trade without the expected dividend, which is paid later in the month.

Payment dates are as follows;
Blackrock I Shares 11 July 2025
Betashares 16 July 2025
Global X 16 July 2025
Vanguard 16 July 2025
Fidelity 18 July 2025
Magellan 21 July 2025
Van Eck 25 July 2025

The distribution can vary each year (more than a dividend from shares) as it can include any realised capital gain sold within the ETF over the period.

This year, we are seeing some ETFs pay a higher-than-normal distribution. These include;

IAA (Asia) distribution yield is 4.1%.
RBTZ (Global Robotics) distribution yield is 4.01%
SEMI (Global Semiconductors) distribution yield is 7.09%.

Financial Planning Snippets
PLEASE BE VIGILANT regarding financial scamming. If anyone is requesting financial information from you (via phone, email, text, or social media), please contact us first or ask them for their ABN.
Super Guarantee (SGC) for employees increases to 12% from 1/7/25
Concessional super contributions maximum of $30k
Commonwealth Seniors Health Care card has seen the income limit increase to $158,440 (couple) $99,025 (single). If you are of Age Pension age and don’t have the card, please let us know.

Other Stories
RBA are recommending the removal of surcharge fees, which will be a good saving; however, it might remove the benefits from the reward points programs. Therefore may be better to use your points (if you have them) sooner rather than later.

Broker Target Price changes
Target Prices should be viewed as a compass (the general direction) rather than a GPS destination.

Ord Minnett
South 32 (S32) decreased from $4.10 to $3.90

Morgans
BHP increased from $43.70 (highest broker) to $43.90 (still highest broker)
Santos (STO) decreased from $6.90 (lowest broker) to $6.80 (still lowest broker)
S32 decreased from $4.30 (highest broker) to $4.10 (still highest broker)
Telstra (TLS) increased from $4 (lowest broker) to $4.70
Woodside (WDS) increased from $30.10 (highest broker) to $31 (still highest broker)

Morgan Stanley
Computershare (CPU) decreased from $34.60 (lowest broker) to $33.70 (still lowest broker)

Macquarie
Goodman Group (GMG) decreased from $36.06 to $35.24
Lend Lease (LLC) decreased from $7.79 (highest broker) to $7.23 (still highest broker)
S32 decreased from $3.60 to $3.40
Orora (ORA) decreased from $2.39 to $2.36

Bell Potter/Citigroup
NextDC (NXT) decreased from $18.70 to $18.35

UBS

Tracking changes for 2025
Upgrades 168
Downgrades 170

Core Watchlist Index (changes since last Not So)

The CORE Watchlist is a collection of 30 Australian shares, predominantly “Blue Chip”. We obtain research from up to 6 brokers on each share. Each broker provides a Target Price (value in 12 months) which then provides us with an average for each stock. We then compare that average to the current price as a percentage. IE Macquarie price $176.95 Av. Target Price $205.96= 85.9% (meaning 14.1% upside over next 12 months) + income 4.35% (including franking).

To get the CORE Index we take the average across the 30 stocks. This provides us with a market average as there are up to 80 teams of analysts providing the research and target prices. The CORE Watchlist stocks represent more than 55% of the ASX 200 and so provide us with a good indicator of the market value. When it’s at 100% then the market is fully priced. We have seen that when the index is below 90%, then it’s good buying, but that doesn’t happen very often. Should you have any questions, please let me know.

The Core index decreased from 98.41% to 97.78%. If we removed the 4 banks, the index falls to 93.37%

Overall Earnings Per Share (EPS)
FY25 decreased from 1.13% to 1.06% new low of 0.85% last week.
FY26 increased from 8.17% to 8.19%

Most expensive – CBA 162.5% (176.5% highest ever).
Least expensive – NextDC (NXT) 71.9%

The CORE Watchlist has 10 (10) stocks trading above 100%; they are; ANZ BXB CBA CPU JBH MQG NAB TLS WBC WES, lowest number ever is 0, highest is 14. While 7 (5) is trading below 85% (the highest is 18, and the lowest is one). AMC CSL LLC NXT RMD S32 SEK (Figures in brackets are last Not So).

STOCKS TRADING BELOW ALL BROKER FORECASTS ARE AS FOLLOWS; (it has been a handy indicator in the past). 10 out of the 30 CORE stocks are trading below the lowest broker target price. Highest 24. Lowest is 2.

ALL current price $66.60 Broker range $70 to $76
AMC current price $14.48 Broker range $14.50 to $20.31
BHP current price $39.11 Broker range $39.50 to $48.70
COL current price $20.39 Broker range $20.95 to 23.50
CSL current price $247.45 Broker range $310 to $360.30
LLC current price $5.09 Broker range $5.85 to $7.79
NXT current price $14.08   Broker range $18.00 to $21.20
RMD current price $38.90 Broker range $44.07 to $48
SEK current price $24.00 Broker range $25.80 to $30.10
WOW current price $31.11 Broker range $31.80 to $36

Added AMC COL RMD
Removed ORI

Banking Index (changes since last Not So)

Like the CORE Watchlist index, the Banking index is the four major banks’ average target price based on research from up to 6 brokers. The percentage below 100% is the potential upside over the next 12 months (not including income). If at or over 100%, then this indicates the Banks are fully priced.

The banking index increased from 127.8% to 128.8%.

Based on today’s bank prices, the table below shows the estimated dividends (c) and yield. PLUS FRANKING.
FY 25 % FY 26 % FY27 %
ANZ 164.00 5.44% 162.00 5.38% 162.2 5.39%
CBA 484.20 2.73% 499.60 2.73% 515.4 2.90%
NAB 170.00 4.44% 170.20 4.45% 165.4 4.32%
WBC 152.00 4.56% 155.20 4.66% 148.6 4.46%
MQG 650.00 2.92% 739.50 3.32% 801.25 3.60%

CBA yield is below all the others.

Dividend expectations for BHP and RIO. The forecasts below are for the full year. Plus franking. Please note RIO is Calendar Year (CY). Cents per share (CPS).
FY25 % FY26 % FY27 %
BHP 153.83 3.93% 155.50 3.98% 167.00 4.27%
RIO 581.17 5.26% 582.83 5.27% 606.17 5.48%

Other Indicators (changes since last Not So)

US VIX (Fear) Index increased from 16.17 to 17.59. Just above normal levels. Normal is 10-17.
Iron Ore increased from $95.85 to $98.95. The average expectation for 2025 is $99.1.
Copper decreased from $5.64 to $5.52.  New ALL TIME HIGH of $5.8955 on July 8, blowing past the previous high of $5.26. The 50% Copper tariffs were the cause
Gold increased from $3335 to $3344. ATH $3509.90.
AUD/USD decreased from 65.58c to 65.26c.
Asian markets – MIXED.
US 10-year Bonds increased from 4.35% to 4.48%.  2-year rate 3.95%. 30 year rate back above 5% at 5.02%.
German 10 year Bonds increased from 2.63% to 2.72%.
Japanese 10 year Bonds increased from 1.50% to 1.57%. Highest for 16 years was 1.59%.
Aussie Bonds 10 year Bonds increased from 4.29% to 4.41%.  Recent high 4.95%.
Oil prices decreased from $68.46 to $66.74.
Tungsten—China price remained at $433mtu. The European price range increased from $440-$485 to $450-$485mtu (highest price for 12 years).

This week & next week
Last, “Not So” opened in 7 Aust states (excl Tas), 6 US states (California, Massachusetts, New Jersey Colorado, South Carolina, Virginia), Bulgaria, Sweden, NZ, India, Chile and Israel.

This week – In Office – July reviews
Next week – In Office- July reviews (except Friday)

PO BOX 149 Deniliquin NSW 2710
125 End St Deniliquin NSW 2710
Ph. 03 58950100
Fax 03 58950101
Mobile 0412113524
scottm@provincialwealth.com.au
kevinh@provincialwealth.com.au
chrisp@provincialwealth.com.au
maddyl@provincialwealth.com.au

The Not So Daily Bulletin 30th of June 2025 No. 715

July 8, 2025 (updated July 8, 2025)

Top Stories

On Monday, June 30, 2025, the ASX gained 28 points to finish at 8542.

The market was positive after the US S&P500 hit a new ALL-TIME HIGH on Friday, even though tariff talks are about to take centre stage alongside the One Big Beautiful Bill, which passed the Senate 51-49 over the weekend.

Today, the ASX gains were towards recent laggards  CSL, up 2.2%, MQG, up 3.9%, and NXT, up 2.2%. There may have been some switching out of CBA, which was down at $184.75, down from its ATH of $192 set last week.

The Coppo report says July is usually quiet but we will see with the tariffs coming back.

The ASX finished the year up 10% which was a good result considering the headwinds. Most ETF’s trade ex-dividend tomorrow with the dividends paid in July.

This is an interesting story about driverless ride-sharing technology. It’s coming in the next few years. Compared to human drivers, the accident rate is down 78% (I’m not sure I’m game just yet).

The bond markets are still reasonably calm, so there are no concerns about the potentially rising US debt.

We will likely see more volatility in the coming weeks.

We are happy for you to share our Not So Daily Bulletin with family and friends, and if we can help them, we are also happy to chat.

July tends to be quiet
According to the Bell Potter Coppo report, Richard Copplestone made the following observations about the market in July.

1.   It’s a 4 day week in US as Friday US markets are closed for their 4th July “Independence Day” national holiday
2.   End of Financial year today – so rest of this week & all next week – instos will be squirrelled away from the market preparing their end of EOFY reports as to why they outperformed (due to excellent understanding of the mkt by themselves) or why they underperformed (due to “external shocks – like Trump’ unpredictability or the Tariff selloff or Iran (if they were long Oil/ oil stocks for that one).
3.   Also many fund managers have jetted off on holidays, with schools breaking up for the next 3 weeks – so many will be away for much of July.
4.   Then as they get back from holidays, those who worked in the first half of July, then take their holidays over the 2nd half of July.
5.   It’s US & European summer – so they are all off on their summer breaks (like we do in “our summer holidays” in December & January) as well – that lowers trading volumes across the globe.
6.   No Transition Portfolios are seen in early July – if they were going to do one – it’d be done in June.
7.   I said to this guy over the last 30 years the one time I particularly dislike to be at work – is in the first 3 weeks of July – as everyone is way, trading is crap & it’s usually quite boring.
8.   BUT we do tend to see profit warnings come through from companies that have just seen their end of June 30 numbers & need to advise – that adds to some volatile moves.
9.   Also with reporting season starting in August – we tend to start seeing a number of stocks that are expected top, do well – or poorly – start to move up or down as buyers or shortener’s start to get their trading positions set.
10.   So often as we see a number of stocks report – they may have already moved say 10% before their result & if it’s a good result they’ll add +10% more & if it’s a shocker they’ll drop -15% to -20% or even more if it’s a real shocker.
11.   So July tends to thin, strong but overall quiet boring, but a lot of stocks do start to move from 21st July on– thin trading sees large moves in many stocks in the last few weeks of July..

Aussie Equity strategy

Morgans updated their Aussie equity view.

The Australian economy continues to defy expectations of a sharper slowdown. A resilient labour market and better-than-feared retail spending are helping to support the earnings outlook for listed companies. However high prices at the large end of the market (ASX 20) may limit large cap returns. As such, we think the potential broadening-out of performance to mid-small caps provides a better risk/reward balance for returns.

Equity sector preferences:
Absent a sustained rebound in commodity prices given the ongoing disruption in global trade, above-average earnings growth will be difficult to achieve in a slower economy. Accordingly, we prefer a targeted portfolio approach, tilting what we believe are the best relative opportunities and the best risk/return profile. We prefer tilting exposure toward mid/small caps and quality cyclicals while monitoring/ reducing exposure to those caught in the expensive flight-to-defensive sectors (banks, staples, telcos).

Review and re-balance:
Defensive, and domestic facing segments broadly continue to outperform growth amid the increasingly uncertain geopolitical and macro-economic environments triggered by overseas events including a volatile policy agenda from the White House. There appears to be little room for error in stretched equity valuations. Equity risk appetite looks set for a bumpy end to 2025, requiring investors to review and re-balance portfolios more frequently.

Sector ratings:
Morgans sector analysts have moved to Neutral ratings on both the Telco (upgraded from Underweight) and Consumer Staples sectors (downgraded from Overweight).

Core & ETF June 2025 review
As always, performances were mixed throughout the month. The ASX gained 1.27% for the month, the calendar year ASX was up 4.7% (6 months), and the financial year ASX was up 9.96% (12 months).

CORE Watchlist
30 ASX-listed stocks from our CORE Watchlist.
The best performers for the month were Santos (STO), which was up 16.2% after receiving a takeover offer from Abu Dhabi energy company. NextDC (NXT) is up 10.6% after a rebound in the demand for data centres, and Macquarie (MQG) is up 6.8% after a sell down in April.

Other notable gainers for the month were Woodside (WDS) up 6.2% and CBA 5%.

The worst performers for the month were Lend Lease (LLC) down 7.8%, after gaining 10% last month. Rio Tinto (RIO), down 4.9%, as iron ore was weaker and South 32 (S32) down 4.6%, due to commodity weakness.

Over the calendar year (6 months), the best performers were the same as last month, Nine Entertainment (NEC), up 31.6% after Domain was sold (Nine is the majority owner), Brambles (BXB), up 21.7% on positive profit result and Telstra (TLS), up 20.7% after finally being recognised as having technology exposure.

Other notable gainers for six months were CBA up 20.6%, JB Hi-Fi up 19.1% Wesfarmers (WES) up 18.5% and Computershare (CPU), up 17.5%,

The worst performers were Orora (ORA), down 23.2%, as concerns about the French bottle acquisition and the impact of a trade war on the global liquor trade. CSL down 15% as healthcare out of favour. South 32 (S32) is down 14.4% as resources have struggled.

Over the financial year (12 months), the best performers were JB Hi-Fi (JBH), up 80.3% as technology sales continue to deliver, Brambles (BXB), up 61.2% and Computershare (CPU), up 51.4% as share registry outlook improves.

Other notable gainers for 12 months were CBA up 45%, Telstra (TLS) up 33.7%, ResMed (RMD) up 35.2%, Wesfarmers (WES) up 30%, Aristocrat Leisure (ALL) up 31%, Westpac (WBC) up 24.4% & Coles (COL) up 22%.4%

The worst three were S32 down 20.5%, CSL down 18.9% and NXT down 17.8% after a selloff due to concerns about data centre demand, which has started to reverse.

EXCHANGE-TRADED FUNDS (ETF)
As part of our research, we cover approximately 80 ETFs. The best and worst performers for the period(s) were as follows.

The best performers for the month are Korea (IKO), up 15.7%, as a change in political leader is a positive for the country and investors. Global Semiconductors (SEMI), up 6.7%, continued to rebound after a selloff due to data centre demand and trade issues regarding tariffs. The result would have been better but it went ex-dividend today 7% (giving a 13.7% gain for the month) and Asia (IAA) up 8.1% as the recovery in the Asian economies continues.

Other notable gainer for the month was Emerging Markets (EMKT), up 5.7%

The worst three were Global Property (RCAP), down 1.5% as US interest rate cuts have been delayed. Japan (IJP) down 0.7% on inflation, higher expected. Global Health (IXJ), down 0.3%, as concerns about Trump tariffs remain for pharmaceuticals and changes to US health policy from RFK Jr.

The best for the calendar year (6 months) were IKO, up 32.6%, and Europe (IEU), up 16.8% due to expected stimulus and cheap valuations. Asia (IAA) up 14.2%.

Other notable gainers China (IZZ) up 14.2% Global Cybersecurity (HACK) up 11.8%, EMKT up 11.4% & Global Value (VLUE) up 11.1%

The worst performers were Global Biotech (CURE), down 12.4%, and Global Cloud Computing (CLDD), down 8.9%, after concerns about data centre demand. Global Health (IXJ) down 4%

The best performers for the financial year (12 months) were IZZ, up 40.9%; Global Cybersecurity (HACK), up 34.6% due to the growing need to protect data; and IAA, up 24%.

Other notable gainers for the 12 months, Global AI (GXAI) up 21.8% China New Economy (CNEW) up 20.7%, Australian Property (MVA) up 19.3% Europe (IEU) up 18.3%, Global Value (VLUE) up 18.6%, EMKT up 16.9%.

The worst performers were CURE, which was down 9%, IXJ, which was down 5.7%, and Australian Resources (MVR), which was down 2.6%.

A significant technology change – driverless ride sharing.
Last week, with great fanfare, Tesla launched its ride-sharing taxis in Austin, Texas. However, another company, Waymo (owned by Alphabet—Google’s parent company), has been delivering ride-sharing technology over the last year. To date, Waymo has driven 7 million autonomous miles and is conducting 200,000 paid trips per week, while Telsa has accumulated 50,000 miles between its Texas and California factories.

I asked Microsoft’s Co-pilot to provide the advantages and disadvantages of each

Waymo
Waymo is a subsidiary of Alphabet Inc. (Google’s parent company) and focuses on developing autonomous driving technology. Waymo’s self-driving cars, known as Waymo One, are used for ride-hailing services in several U.S. cities. They utilise advanced sensors, machine learning, and artificial intelligence to navigate roads without human intervention.

Advantages:
Safety: Waymo’s autonomous vehicles are designed to reduce human error, which is a major cause of accidents (see chart below).
Cost Efficiency: Operating costs are lower compared to traditional ride-hailing services since there are no driver salaries
Environmental Benefits: Waymo’s fleet includes electric vehicles, contributing to reduced emissions.
Technological Innovation: Waymo continuously improves its sensor suite and driving algorithms.

Disadvantages:
Regulatory Challenges: There is still significant pushback and concern over regulation, as no federal law oversees self-driving cars.
Weather Limitations: Waymo’s technology can struggle in adverse weather conditions like heavy snow.
High Initial Investment: Developing and deploying autonomous vehicles requires substantial capital.

Tesla
Tesla is an American electric vehicle (EV) manufacturer founded by Elon Musk. Tesla is known for its innovative electric cars, energy products, and advanced driver-assistance systems like Autopilot and Full Self-Driving (FSD).

Advantages:
Performance: Tesla vehicles offer impressive acceleration, handling, and overall performance.
Autopilot and FSD: Tesla’s advanced driver-assistance features are continually improving and moving closer to full autonomy.
Supercharger Network: Tesla has established a global network of fast-charging stations, making long-distance travel more convenient.
Environmental Benefits: Tesla’s commitment to sustainable energy helps reduce greenhouse gas emissions.
Innovation: Tesla is known for its continuous introduction of new features and products.

Disadvantages:
High Initial Cost: Tesla vehicles can be relatively expensive compared to traditional gasoline-powered cars.
Quality Control Issues: Some owners have reported issues related to build quality and reliability.
Dependence on Software Updates: Frequent software updates can change vehicle functionality and performance over time.
Charging Infrastructure: While Tesla’s Supercharger network is extensive, it is limited to Tesla vehicles.

Both Waymo and Tesla are pioneering the future of transportation, each with its unique strengths and challenges.

Morgan Stanley (MS) provided an update on Waymo’s safety
LA Safety Data Indicate Waymo’s Safety Advantage vs. Humans Scaling to New Cities. Waymo is now including LA data in its comparison of accident rates relative to human drivers, and the data suggests Waymo still maintains a healthy safety advantage vs. human drivers, with ~79% fewer airbag deployment crashes and 78% fewer injury-causing crashes.

This safety advantage has largely remained stable vs. historical data releases which only included SF and Phoenix ( Exhibit 2 ).

MS thinks this speaks to the ability of Waymo to generalize in new regions without sacrificing safety. We have written about Waymo’s work to build a generalizable and scalable self-driving system (see here). It will be important to track how Waymo’s safety performance compares to other autonomous players as they begin to ramp up their operations.

Financial Planning Snippets
PLEASE BE VIGILANT regarding financial scamming. If anyone is requesting financial information from you (via phone, email, text, or social media), please contact us first or ask them for their ABN. Super Guarantee (SGC) for employees increases to 12% from 1/7/25
Concessional super contributions maximum of $30k
Commonwealth Seniors Health Care card has seen the income limit increase to $158,440 (couple) $99,025 (single). If you are of Age Pension age and don’t have the card, please let us know.

Other Stories – Nine Entertainment (NEC) via Stan has bought the local rights to English Premiership League (EPL) – soccer.

Broker Target Price changes
Target Prices should be viewed as a compass (the general direction) rather than a GPS destination.

Ord Minnett

Morgans

Morgan Stanley

Macquarie
BHP decreased from $42 to $40
Rio Tinto (RIO) decreased from $115 to $105 (lowest broker)
South 32 (S32) decreased from $4.50 (highest broker) to $3.60

Bell Potter/Citigroup

UBS

Tracking changes for 2025
Upgrades 164
Downgrades 160

Core Watchlist Index (changes since last Not So)
The CORE Watchlist is a collection of 30 Australian shares, predominantly “Blue Chip”. We obtain research from up to 6 brokers on each share. Each broker provides a Target Price (value in 12 months) which then provides us with an average for each stock. We then compare that average to the current price as a percentage. IE Macquarie price $176.95 Av. Target Price $205.96= 85.9% (meaning 14.1% upside over next 12 months) + income 4.35% (including franking).

To get the CORE Index we take the average across the 30 stocks. This provides us with a market average as there are up to 80 teams of analysts providing the research and target prices. The CORE Watchlist stocks represent more than 55% of the ASX 200 and so provide us with a good indicator of the market value. When it’s at 100% then the market is fully priced. We have seen that when the index is below 90%, then it’s good buying, but that doesn’t happen very often. Should you have any questions, please let me know.

The Core index increased from 97.37% to 97.70%. If we removed the 4 banks, the index falls to 92.96%

Overall Earnings Per Share (EPS)
FY25 decreased from 0.96% to 0.92% new low.
FY26 increased from 7.96% to 8.13%

Most expensive – CBA 169.1% (176.5% highest ever)
Least expensive – NextDC (NXT) & CSL at 73.8%. Both jumped 2% today. We might see a rally in both these in the new FY.

The CORE Watchlist has 11 (11) stocks trading above 100%; they are; ANZ BXB CBA CPU JBH MQG NAB TCL TLS WBC WES, lowest number ever is 0, highest is 14. While 6 (7) is trading below 85% (the highest is 18, and the lowest is one). AMC CSL LLC NXT ORA ORI SEK (Figures in brackets are last Not So).

STOCKS TRADING BELOW ALL BROKER FORECASTS ARE AS FOLLOWS; (it has been a handy indicator in the past). 11 out of the 30 CORE stocks are trading below the lowest broker target price. Highest 24. Lowest is 2.

ALL current price $65.17 Broker range $70 to $76
BHP current price $36.75 Broker range $39.50 to $48.70
CSL current price $239.48 Broker range $310 to $360.30
LLC current price $5.38 Broker range $6.30 to $7.50
NEC current price $1.63 Broker range $1.65 to $2
NXT current price $14.50 Broker range $18.00 to $21.20
ORA current price $1.89 Broker range $2.03 to $2.50
ORI current price $19.49 Broker range $20.65 to $23
SEK current price $24.05 Broker range $25.80 to $30.10
S32 current price $2.91 Broker range $3.05 to $4.30
WOW current price $31.11 Broker range $31.80 to $36

Added
Removed SHL

Banking Index (changes since last Not So)
Like the CORE Watchlist index, the Banking index is the four major banks’ average target price based on research from up to 6 brokers. The percentage below 100% is the potential upside over the next 12 months (not including income). If at or over 100%, then this indicates the Banks are fully priced.

The Banking index increased from 126.1% to 131.2% record high. CBA is still dominating.

Based on today’s bank prices, the table below shows the estimated dividends (c) and yield. PLUS FRANKING.

FY 24 % FY 25 % FY26 %
ANZ 166.00 5.69% 164.00 5.62% 162 5.56%
CBA 475.00 2.57% 484.20 2.62% 499.6 2.70%
NAB 169.00 4.29% 170.00 4.32% 170.2 4.32%
WBC 166.00 4.90% 152.00 4.49% 155.2 4.58%
MQG 645.00 2.82% 650.00 2.84% 735.75 3.22%
CBA yield is below all the others.

Dividend expectations for BHP and RIO. The forecasts below are for the full year. Plus franking. Please note RIO is Calendar Year (CY). Cents per share (CPS).
FY24 % FY25 % FY26 %
BHP 219.00 5.96% 155.00 4.22% 160.17 4.36%
RIO 615.00 5.90% 616.17 5.91% 615.17 5.90%

Other Indicators (changes since last Not So)
US VIX (Fear) Index decreased from 17.48 to 16.32. Back below normal level for first time in many weeks. Not sure how long it will last with tariffs taking centre stage again. This time last year it was at 12.69. Normal is 10-17.
Iron Ore increased from $92.85 $94.75. The average expectation for 2025 is $99.1. This time last year it was $106.90, a drop of 11.3%
Copper increased from $4.91 to $5.08.  ALL TIME HIGH of $5.26. This time last year it was $4.41. An increase of 15.1% Gold decreased from $3344 to $3303. ATH $3509.90. This time last year it was $2,337. An increase of 41.3%
AUD/USD increased from 65c to 65.39c. This time last year it was $66.47c A decrease of 1.6%.
Asian markets – UP.
US 10-year Bonds decreased from 4.29% to 4.27%. This time last year it was 4.45%. A drop of 0.18%.   2-year rate 3.74%. 30 year rate was above 5% now 4.83%.
German 10 year Bonds increased from 2.53% to 2.59%. This time last year it was the same.
Japanese 10 year Bonds increased from 1.40% to 1.43%. Highest for 16 years was 1.59%. This time last year it was 1.10%. An increase of 0.33%
Aussie Bonds 10 year Bonds increased from 4.12% to 4.17%.  Recent high 4.95%. This time last year it was 4.43%. A decrease of 0.26%
Oil prices decreased from $65.28 to $65.17. Ceasefire holding between Israel and Iran. This time last year it was $83.64 or a drop of 22%
Tungsten—China price increased from $418mtu to $428mtu. The European price range increased from $437-$475mtu to $440-$485 (highest price for 12 years).  This time last year, it was China $350 mtu and Europe $335-$360mtu mtu. The price has increased over the year by 22.2% in China and 33% in Europe.

This week & next week
Last, “Not So” opened in 7 Aust states (excl Tas), 3 US states (California, Massachusetts & Colorado), Bulgaria, Sweden UK France, Israel and Italy

This week – In Office – Starting new financial year.
Next week – In Office- Starting new financial year.

Contact Details
PO BOX 149 Deniliquin NSW 2710
125 End St Deniliquin NSW 2710
Ph. 03 58950100
Fax 03 58950101
Mobile 0412113524
scottm@provincialwealth.com.au
kevinh@provincialwealth.com.au
chrisp@provincialwealth.com.au
maddyl@provincialwealth.com.au

The Not So Daily Bulletin 4th of June 2025 No. 710

July 8, 2025 (updated July 8, 2025)

Top Stories

On Wednesday, June 4, 2025, the ASX gained another 75 points to finish at 8542. This is the highest point since 14 February when the market hit an ALL-TIME CLOSING HIGH of 8556 and an INTRA-DAY HIGH of 8615.2.

This occurred on a day when GDP was below expected at 0.2% for the quarter, and iron ore was well below $100. We maybe watching a melt-up (see below).

CBA hit a new ALL-TIME HIGH of $181.39 and accounted for 14 points of the 75. It’s now worth $300bn and valued at more than all the German Banks. it has a forward PE of 29. It’s not the only stock running higher; Wesfarmers (WES) hit an ATH of $84.67. JB HiFi (JBH) hit ATH of $112.98 and Telstra hit a 8 year high of $4.89.

Additionally, we are seeing the US technology stocks running as they have rebounded strongly after the April tariff sell-off. Last week, NVIDIA provided its quarterly profits, which saw revenue of $43bn up from $22bn a year earlier. This has seen NVIDIA, valued at $3.446 trillion and with a forward PE of 29.1, retake the world’s most valuable company title from Microsoft, valued at $3.441 trillion and with a forward PE of 32.

The TACO trade (Trump Always Chickens Out) continues to dominate market sentiment. However, this afternoon, President Trump posted that President Xi of China was very tough and extremely hard to make a deal with. This may suggest the trade war is about to heat up, or the TACO might be right!

The bond markets are still reasonably calm, so there are no concerns about the potentially rising US debt.

The US tariff revenue for May was $23bn, which is well up from last year, but short of President Trump’s claims of them being paid $2bn to $3bn per day.

We will likely see more volatility in the coming weeks.

We are happy for you to share our Not So Daily Bulletin with family and friends, and if we can help them, we are also happy to chat.

Are we watching a melt-up?
The markets are nearing all-time highs, but the fundamental picture seems to be worsening.

Today, our GDP was 0.2% for the quarter and 1.3% for the year. The OECD lowered its forecasts for global growth due to the tariffs and potential trade war, including lower estimates for the US, China, and Australia than it forecast at the end of the year.

The broker research continues to downgrade profit expectations, with the CORE watchlist growth for FY25 down at a meagre 1.25% while PEs for the Watchlist are hitting new highs (usually not a good recipe). CBA is now worth more than $300bn (more than any Australian company ever) with a PE of 29.6, trading 67% above the broker targets, and dividends of 2.62% or 3.75% with franking.

We have all heard of markets having melt-down, but there is an investment term call a melt-up. Maybe we are witnessing a rare melt up. I asked Co-pilot what a melt up was.

In investment terms, a melt-up refers to a sudden and dramatic increase in the price of an asset or market, driven primarily by investor sentiment rather than fundamental improvements in the economy. This phenomenon often occurs when investors rush to buy assets out of fear of missing out on potential gains, leading to rapid and unsustainable price increases.

Melt-ups can be triggered by factors such as low interest rates, excessive optimism, or a lack of better investment alternatives. While they can result in significant short-term gains, melt-ups are often followed by sharp declines or market corrections, as the inflated prices eventually revert to more realistic levels. Investors should be cautious during melt-ups, focusing on economic indicators and fundamentals to avoid getting caught in the subsequent downturn.

Technology and Nuclear Energy
Overnight, Meta (Facebook) signed a new nuclear energy deal, which means it joins NVIDIA, Microsoft, Google, and Amazon, which have signed nuclear energy deals in the last eight months as their solution to rising power needs. I asked Co-pilot to provide a summary.

Meta signed a significant 20-year nuclear power deal with Constellation Energy. This agreement involves Meta purchasing approximately 1.1 gigawatts of power from Constellation’s Clinton Clean Energy Center in Illinois, starting in June 2027. The deal will support the continued operation and relicensing of the plant, which was at risk of closure.

This partnership is part of Meta’s strategy to secure clean, reliable energy to power its AI and computing needs. The Clinton plant will continue to provide power to the regional grid, contributing to Meta’s goal of achieving 100% clean electricity. This move also aligns with broader efforts by tech companies to support nuclear energy as a sustainable power source.

The relationship between technology companies and nuclear energy has been evolving rapidly, driven by the increasing energy demands of data centers and the need for sustainable power sources. Tech giants like Amazon, Microsoft, and Google have been exploring nuclear energy as a reliable and low-emission option to meet their growing power needs. For instance, Amazon Web Services (AWS) acquired a data center campus powered by the Susquehanna nuclear power station Similarly, Microsoft signed a power purchase agreement with Helion Energy, a nuclear fusion company, aiming to secure fusion energy within the next five years. These partnerships highlight the tech industry’s commitment to reducing carbon footprints while ensuring a stable energy supply.

The need for nuclear energy in the tech sector is primarily driven by the massive energy consumption of AI and data centers. AI’s rapid growth has led to a significant increase in power demand, with projections suggesting a 165% rise in global data center power consumption by 2030. Nuclear energy offers a solution by providing clean, firm, and carbon-free power that can be generated consistently. However, the timing of nuclear projects remains a challenge, as building new reactors can take close to a decade. Despite this, the financial support from tech companies can help advance nuclear technologies, including small modular reactors, which promise quicker deployment. This symbiotic relationship between tech companies and the nuclear industry is crucial for achieving sustainable energy goals and supporting the future growth of AI and other technology-driven innovations.

Below are two graphs I have published in the Not So before about nuclear energy and data power requirements that are still relevant.

Financial Planning Snippets
PLEASE BE VIGILANT regarding financial scamming. If anyone is requesting financial information from you (via phone, email, text, or social media), please contact us first or ask them for their ABN.
Super Guarantee (SGC) for employees increases to 11.5% from 1/7/24
Concessional super contributions maximum of $30k
Commonwealth Seniors Health Care card has seen the income limit increase to $152k(couple) $95.4k (single). If you are of Age Pension age and don’t have the card, please let us know.

Other Stories
Macquarie cut cash rates after the RBA interest rate cut last week. Cash Management Account (CMA) moves from 2.50% to 2.25% and Accelerator Account moves from 4.4% to 4.15%.

Broker Target Price changes
Target Prices should be viewed as a compass (the general direction) rather than a GPS destination.

Ord Minnett

Morgans
Rio Tinto (RIO) decreased from $123 to $119

Morgan Stanley

Macquarie

Bell Potter/Citigroup
Coles (COL) decreased from $22.10 to $21
Resmed (RMD) increased from $44 to $45

UBS

Tracking changes for 2025
Upgrades 158
Downgrades 146

Core Watchlist Index (changes since last Not So)
The CORE Watchlist is a collection of 30 Australian shares, predominantly “Blue Chip”. We obtain research from up to 6 brokers on each share. Each broker provides a Target Price (value in 12 months) which then provides us with an average for each stock. We then compare that average to the current price as a percentage. IE Macquarie price $176.95 Av. Target Price $205.96= 85.9% (meaning 14.1% upside over next 12 months) + income 4.35% (including franking).

To get the CORE Index we take the average across the 30 stocks. This provides us with a market average as there are up to 80 teams of analysts providing the research and target prices. The CORE Watchlist stocks represent more than 55% of the ASX 200 and so provide us with a good indicator of the market value. When it’s at 100% then the market is fully priced. We have seen that when the index is below 90%, then it’s good buying, but that doesn’t happen very often. Should you have any questions, please let me know.

The Core index increased from 96.09% to 96.96%. If we removed the 4 banks, the index falls to 92.35%

Overall Earnings Per Share (EPS)
FY25 decreased from 1.68% to 1.25%. New lows, not a positive sign for the market.
FY26 increased from 7.4% to 8.43%

Most expensive – CBA 167% (highest ever)
Least expensive – NextDC (NXT) 68.2%.

The CORE Watchlist has 11 (10) stocks trading above 100%; they are; ANZ BXB CBA CPU JBH MQG NAB TCL TLS WBC WES, lowest number ever is 0, highest is 14. While 7 (7) is trading below 85% (the highest is 18, and the lowest is one). AMC CSL LLC NXT ORA RMD S32 (Figures in brackets are last Not So).

STOCKS TRADING BELOW ALL BROKER FORECASTS ARE AS FOLLOWS; (it has been a handy indicator in the past). 11 out of the 30 CORE stocks are trading below the lowest broker target price. Highest 24. Lowest is 2.

ALL current price $63.25 Broker range $70 to $76
BHP current price $37.95 Broker range $39.50 to $48.70
CSL current price $246.22 Broker range $310 to $360.30
GMG current price $33.23 Broker range $33.50 to $42.40
LLC current price $5.79 Broker range $6.30 to $7.50
NEC current price $1.61 Broker range $1.65 to $2
NXT current price $13.25 Broker range $18.70 to $21.20
ORA current price $1.88 Broker range $2.03 to $2.50
ORI current price $18.93 Broker range $20.65 to $23
SEK current price $23.92 Broker range $25.80 to $30.10
S32 current price $3.02 Broker range $3.05 to $4.50

Added
Removed STO

Banking Index (changes since last Not So)
Like the CORE Watchlist index, the Banking index is the four major banks’ average target price based on research from up to 6 brokers. The percentage below 100% is the potential upside over the next 12 months (not including income). If at or over 100%, then this indicates the Banks are fully priced.

The Banking index increased from 123.9% to 126.6%. CBA hitting another all time high and sitting at 167% of the target price (average of six brokers).

Based on today’s bank prices, the table below shows the estimated dividends (c) and yield. PLUS FRANKING.

   FY 24 % FY 25 % FY26 %
ANZ 166.00 5.60% 164.00 5.53% 162 5.47%
CBA 475.00 2.62% 482.00 2.66% 494.4 2.73%
NAB 169.00 4.38% 170.00 4.40% 170.2 4.41%
WBC 166.00 5.02% 152.00 4.59% 153 4.62%
MQG 645.00 2.97% 650.00 2.99% 735.75 3.39%
CBA yield is below all the others.

Dividend expectations for BHP and RIO. The forecasts below are for the full year.    Plus franking. Please note RIO is Calendar Year (CY). Cents per share (CPS).
   FY24 % FY25 % FY26 %
cps cps cps
BHP 219.00 5.77% 155.00 4.08% 160.17 4.22%
RIO 615.00 5.61% 616.17 5.62% 615.17 5.61%

Other Indicators (changes since last Not So)
US VIX (Fear) Index decreased from 18.57 to 17.69. Nearing normal. Normal is 10-17.
Iron Ore decreased from $99.45 to $94.40. Impact from trade war and increased tariffs on steel to 50%. The average expectation for 2025 is $99.1
Copper increased from $4.70 to $4.86.  ALL TIME HIGH of $5.26.
Gold increased from $3289 to $3375. The VIX is down but gold up. There is still market fear around. ATH $3509.90.
AUD/USD increased from 64.31c to 64.55c. USD weakened over the month
CHN/USD Yuan increased from $7.19 to $7.22.
Asian markets – UP
US 10-year Bonds increased from 4.40% to 4.46%. It hit 4.6% on growing concerns about US debt from the new tax bill  2-year rate 3.96%. 30 year rate was above 5% now 4.98%.
German 10 year Bonds increased from 2.50% to 2.52%.
Japanese 10 year Bonds decreased from 1.53% to 1.50%. Highest for 16 years was 1.59%.
Aussie Bonds 10 year Bonds decreased from 4.29% to 4.26%.  Recent high 4.95%
Oil prices decreased from $60.79 to $63.13.
Tungsten—China price increased from $398mtu to $408mtu. The European price range remained at $410mtu-$445mtu (highest price for 12 years).

This week & next week
Last, “Not So” opened in 7 Aust states (excl Tas), 8 US states (California, Massachusetts, Colorado, Connecticut, Ohio, South Carolina, Virginia and New Jersey), Bulgaria, Sweden & Israel

This week – In Office – June reviews – out of office Hay, Griffith Hillston Thursday- Friday.
Next week – In Office- June reviews

Contact Details
PO BOX 149 Deniliquin NSW 2710
125 End St Deniliquin NSW 2710
Ph. 03 58950100
Mobile 0412113524
scottm@provincialwealth.com.au
kevinh@provincialwealth.com.au
chrisp@provincialwealth.com.au
maddyl@provincialwealth.com.au

The Not So Daily Bulletin 10th of April 2025

July 8, 2025 (updated July 8, 2025)

Top Stories

It’s pleasing to write number 700 on a day when the ASX jumped more in five years & the S&P500 had its best day since 2008.

On Thursday, April 10, 2025, the ASX jumped 335 points to finish at 7710, up 4.5% for the day. However, for all the volatility, the market is only up 42 points or 0.5% for the week. (What’s all the fuss about).

The S&P500 jumped 9.5%, its best day since 2008 and its ninth-highest day ever. The NASDAQ was even better, up 12%.

Here are some individual stock gains from today from our preferred stable: HNDQ +13%, SEMI 12%, QHAL 11%, NXT 9%, S32 9%, NDQ 8%, GXAI 8%, RBTZ 8%, GMG 7%, and HACK 7%.

US Markets initially opened down as the tariff pressure was building. At 1 pm US time, Goldman Sachs issued a research note saying the US was going into a recession. This, plus the 10-year Bond rate had pushed higher than 4.5%, were seen as the catalysts for President Trump to state at 2.10 pm saying tariffs would be reduced to 10% for all countries and paused for 90 days while negotiations could be held with individual countries. However, China’s tariffs would increase to 125% from 104% and remain in place.

Thankfully, President Trump has been persuaded to change the tack, as it was leading to a US and probably a global recession.

HOWEVER, the tariffs are only paused, and the other tariffs remain in place: China 125%, everybody 10%, Canada and Mexico 25%, and Steel and Aluminium 25%. So, these will still impact the US and, to a lesser extent, the global economy. It doesn’t remove the uncertainty, but it gives all parties some wriggle room, which wasn’t apparent earlier in the week.

This change has shown the market’s bottom unless President Trump U-turns back to the same policy, which is unlikely as it was universally condemned. I think the tariffs will be reduced from here. Seventy-plus countries have contacted the US to address the trade issues.

Unfortunately, this event will impact consumer and business confidence. It’s likely to delay some business investment decisions and change buying habits. All of these will impact companies’ value and profitability. The question is, for how long and by how much?

The US quarterly reporting season starts at the end of this week, so this will give the first insight into any impact.

We will likely see some volatility but smaller % moves in the coming weeks.

I have updated the CORE and Banking graph below to reflect today’s movements in the ASX 200. Core is still trading below 90%.

I’m on the road next week. This will be the last Not So until after Easter. Wishing everyone a safe and Happy Easter

We are happy for you to share our Not So Daily Bulletin with family and friends, and if we can help them, we are also happy to chat.

Staying Invested

I thought I would leave this story in from yesterday as today was one of the best days that, if missed, can have an impact on your overall return, as can be seen in the table below.

Our approach is to have a long-term strategy and stick to it. There is an old saying: “Time in the market is better than trying to time the market.”

This means staying invested and not trying to trade the market. It helps cope with market volatility in uncertain times (like now).

As mentioned, things could get a lot worse the longer President Trump sticks with his tariff policy. There is potential for the markets to fall further. HOWEVER, if a change in policy occurs, markets could rally strongly, and if you are trying to trade the market, you may miss out. The biggest days up and down in percentage turns usually occur during these periods (GFC, COVID, Euro debt crisis).

The chart below from Blackrock emphasises the approach of staying invested. If $100,000 were invested in the S&P 500 in 2005, it would have grown to $717,000. If the investor tried to trade the market but missed the best 5 UP days, the value would be $452,000. If the best 10 UP days were missed, the value is $328,000.

So, the story’s moral is to stick to the long-term strategy as it works over time. And, as one client said today, don’t read the financial section; stick to the sports section of the news.

Financial Planning Snippets
PLEASE BE VIGILANT regarding financial scamming. If anyone is requesting financial information from you (via phone, email, text, or social media), please contact us first or ask them for their ABN.
Super Guarantee (SGC) for employees increases to 11.5% from 1/7/24
Concessional super contributions increases from $27.5k to $30k from 1/7/24
Commonwealth Seniors Health Care card has seen the income limit increase to $152k(couple) $95.4k (single). If you are of Age Pension age and don’t have the card, please let us know.

Broker Target Price changes
Target Prices should be viewed as a compass (the general direction) rather than a GPS destination.

Ord Minnett

Morgans

Morgan Stanley
Santos (STO) decreased from $7.46 to $6.95

Macquarie

Bell Potter/Citigroup

UBS

Tracking changes for 2025
Upgrades 103
Downgrades 90

Core Watchlist Index (changes since last Not So)
The CORE Watchlist is a collection of 30 Australian shares, predominantly “Blue Chip”. We obtain research from up to 6 brokers on each share. Each broker provides a Target Price (value in 12 months) which then provides us with an average for each stock. We then compare that average to the current price as a percentage. IE Macquarie price $176.95 Av. Target Price $205.96= 85.9% (meaning 14.1% upside over next 12 months) + income 4.35% (including franking).

To get the CORE Index we take the average across the 30 stocks. This provides us with a market average as there are up to 80 teams of analysts providing the research and target prices. The CORE Watchlist stocks represent more than 55% of the ASX 200 and so provide us with a good indicator of the market value. When it’s at 100% then the market is fully priced. We have seen that when the index is below 90%, then it’s good buying, but that doesn’t happen very often. Should you have any questions, please let me know.

The Core index decreased from 84.16% to 88.14% (under 90%). This is usually a good entry point.

Overall Earnings Per Share (EPS)
FY25 decreased from 3.28% to 3.05% lowest and likely to go lower in the coming weeks.
FY26 decreased from 9.09% to 8.86%

Most expensive – CBA 143.8%
Least expensive – NextDC (NXT) 55.9%

The CORE Watchlist has 7 (2) stocks trading above 100%; they are; CBA JBH NAB TCL TLS WBC WES, lowest number ever is 0, highest is 14. While 15 (17) is trading below 85% (the highest is 18, and the lowest is one). ALL BHP CSL GMG LLC MQG NEC NXT ORA ORI RMD S32 SEK STO WDS (Figures in brackets are last Not So).

STOCKS TRADING BELOW ALL BROKER FORECASTS ARE AS FOLLOWS; (it has been a handy indicator in the past). 18 out of the 30 CORE stocks are trading below the lowest broker target price. Highest 24. Lowest is 2.

ALL current price $63.13 Broker range $73 to $84
AMC current price $14.72 Broker range $15.25 to $19
BHP current price $36.00 Broker range $39.50 to $48.10
COL current price $20.84 Broker range $20.90 to $22.35
CSL current price $241.78 Broker range $310 to $360.30
GMG current price $27.80 Broker range $33.50 to $42.40
LLC current price $5.38 Broker range $6.30 to $7.50
NEC current price $1.40 Broker range $1.65 to $2
NXT current price $11.03   Broker range $18.70 to $21.20
ORA current price $1.76 Broker range $2.15 to $2.57
ORI current price $15.91 Broker range $18.85 to $21.50
RIO current price $110.59 Broker range $116 tom $130
S32 current price $2.76 Broker range $3.90 to $4.50
SEK current price $21.04 Broker range $26.75 to $30.10
SHL current price $25.20 Broker range $26.50 to $32.80
STO current price $5.56 Broker range $7.10 to $8.95
WDS current price $20.05 Broker range $20.50 to $30.25

Banking Index (changes since last Not So)
Like the CORE Watchlist index, the Banking index is the four major banks’ average target price based on research from up to 6 brokers. The percentage below 100% is the potential upside over the next 12 months (not including income). If at or over 100%, then this indicates the Banks are fully priced.

The Banking index decreased from 108% to 112.5%. only ANZ is below 100%.
Based on today’s bank prices, the table below shows the estimated dividends (c) and yield. PLUS FRANKING.

FY 24 % FY 25 % FY26 %
ANZ 166.00 6.05% 166.40 6.07% 168.2 6.13%
CBA 475.00 3.07% 480.00 3.11% 488.4 3.16%
NAB 169.00 5.00% 170.00 5.03% 170.2 5.03%
WBC 166.00 5.42% 155.40 5.08% 156.6 5.12%
MQG 645.00 3.58% 635.25 3.52% 739.25 4.10%

Dividend expectations for BHP and RIO. The forecasts below are for the full year. Plus franking. Please note RIO is Calendar Year (CY). Cents per share (CPS).
FY24 % FY25 % FY26 %
cps cps cps
BHP 219.00 6.08% 159.00 4.42% 180.00 5.00%
RIO 617.00 5.58% 655.00 5.92% 640.50 5.79%

Other Indicators (changes since last Not So)
US VIX (Fear) Index decreased from 52.33 to 33.62. Which is still at very high levels.
Iron Ore increased from $94.90 to $96.80. The average expectation for 2025 is $99.80
Copper increased from $4.13 to $4.45.  ALL TIME HIGH of $5.26 last week. Massive jump after recent sell off.
Gold increased from $3033 to $3137. ATH today of $3196.60 AUD/USD decreased from 59.68c to 61.93c. Big jump today. 59.15c recent low..
CHN/USD Yuan decreased from $7.35 to $7.32. China has been devaluing its currency to lessen the impact of the tariffs.
Asian markets – STRONGLY HIGHER
US 10-year Bonds decreased from 4.42% to 4.30%. It fell to 3.9% last week, but has pushed higher.  2-year rate 3.90.
German 10 year Bonds decreased from 2.63% to 2.61%.
Japanese 10 year Bonds increased from 1.27% to 1.37%. Highest for 16 years was 1.59%.
Aussie Bonds 10 year Bonds decreased from 4.37% to 4.30%.  Recent high 4.95%
Oil prices increased from $57.23 to $61.81. Energy prices bounced sharply.
Tungsten—China price remained at $358mtu . The European price range remained at $350mtu-$370mtu. Not included in the US tariffs, therefore exempt.

This week & next week
Last, “Not So” opened in 7 Aust states (excl Tas), 6 US states (California, Massachusetts, Colorado, Connecticut Ohio & Virginia), Bulgaria, Sweden, Italy, Iran,

This week – In Office –
Next week – On the road all week – Central and Northern NSW

Contact details
PO BOX 149 Deniliquin NSW 2710
125 End St Deniliquin NSW 2710
Mobile 0412113524
scottm@provincialwealth.com.au
kevinh@provincialwealth.com.au
chrisp@provincialwealth.com.au
maddyl@provincialwealth.com.au

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