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clusterassets · 6 years

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New world news from Time: Son Heung-min Wants to Bring World Cup Glory to South Korea

Son Heung-min does not look like a man burdened by the weight of national expectation as he strides into a studio in Seoul’s Gangnam neighborhood. The South Korean soccer star changes into his national team shirt and pulls long red socks up over his shins before breaking out his trademark grin for the photographer, eyes sparkling and smile lines crinkling his cheeks. “In every country I’ve gone to, if you smile at people, they are going to be happy. This is my attitude,” Son, 25, tells TIME. A platitude, perhaps, but to this reporter at least, it works.

Son’s natural brightness belies the responsibility he will face as South Korea’s talisman at the World Cup, which will kick off in Russia on June 14. As a forward for the English Premier League’s Tottenham Hotspur club, he has become the top Asian goal scorer in the elite league’s history. And as a two-time Asian Football Confederation Asian International Player of the Year, he is aware that it is not only national pride that’s at stake. The fact that young soccer players across the region are dreaming of emulating his career gives him “goose bumps,” he says. “At Tottenham Hotspur, we can share the pressure, but on the South Korea team, some of the players have more pressure than others,” Son acknowledges. At the same time, though, that stress motivates him. “How many people have pressure like this?” he asks. “I’m such a lucky guy.”

The pressure may be even greater at this World Cup as South Korean soccer’s big outing on the world stage is at risk of being eclipsed by theater of a political kind. The on-again, off-again summit between North Korean leader Kim Jong Un and U.S. President Donald Trump is now apparently on again on June 12, two days before the tournament begins, and the North and South have agreed to hold military talks on its opening day.

The Winter Olympics in PyeongChang in February shone a spotlight on the role that international sports competitions can play in defusing tensions between nations. Following a year of missile tests and saber rattling, North and South Korea marched under one flag at the opening ceremony. The North did not qualify for the 2018 World Cup, but that does not mean Son hasn’t considered playing for a unified team some day. “I dream of it,” he says. “Of course people would be happy to see us playing together because we are one country.”

Soccer’s popularity soared in South Korea after the country co-hosted the World Cup with Japan in 2002. At 9 years old, Son watched, besotted, as the Reds defeated European soccer giants Portugal, Spain and Italy to reach the semifinal stage of the tournament.

Son was soon picked to train with the youth academy at FC Seoul, and left South Korea at age 16 to join German Bundesliga club Hamburg S.V. He later played for Bayer Leverkusen. Those first years in Europe were tough, he says, and though he now speaks German and English, the learning curve was steep.

When he signed for Tottenham at a reported cost of about $30 million in 2015, Son became the most expensive Asian soccer player in history. He has justified his price tag by becoming the team’s second highest scorer this past season. His sunny demeanor made him a hit with his North London teammates, whom he treated to a Korean barbecue buffet shortly after his arrival to the U.K. He says they regularly ask him to perform “Gangnam Style,” the 2012 hit by South Korean pop star Psy. Spurs fans prefer to chant the Beatles song “Here Comes the Sun” when he runs out onto the field.

Kim Hong-Ji—ReutersSoccer Football – International Friendly – South Korea vs Bosnia and Herzegovina – Jeonju World Cup Stadium, Jeonju, South Korea – June 1, 2018 South Korea’s Son Heung-Min in action with Bosnia’s Haris Duljevic REUTERS/Kim Hong-Ji

He has yet to have such success with the Reds since making his senior World Cup debut in Brazil in 2014. South Korea failed to advance beyond the group stages that year, and in a traditional Korean insult, angry fans pelted the players with candy upon their return when they landed at Incheon International Airport.

Son’s national expectations extend beyond soccer. All able-bodied men in South Korea are mandated to start 21 months of military service before age 28, and Son, like many younger sports stars, has yet to perform his. Still, it can become a national scandal when a celebrity is thought to have dodged the draft; after Korean-American pop star Steve Yoo avoided military service by becoming a naturalized U.S. citizen in 2002, he was banned from re-entering South Korea.

For Son, who will turn 26 in July, a two-year absence from the game would mean missing what are usually considered a soccer player’s peak years. The possibility vexes not only South Koreans but also Tottenham Hotspur’s passionate fan base. Asked if it is weighing on his teammates’ minds, Son says military service doesn’t come up often: “I think we are not talking much about that.” His agent cuts off any more questions about the subject. An exit clause for Son exists in the form of the Asian Games, which will be held in Indonesia in August. Gold medalists are exempted from military service, and Son could yet play for the team. Some of his teammates are already exempt from full military service, having taken the field when South Korea won gold at the 2014 Asian Games or bronze at the 2012 Olympics in London.

Son’s first priority, though, is helping South Korea get through a tough World Cup group that includes defending champions Germany and well-regarded Mexico and Sweden. “We are the weakest team in the group, so we need to work more than them. We need to run more than them—then we can surprise people,” he says.

The night before our meeting on June 2, a few hundred South Korean fans had gathered in a plaza in central Seoul to watch Son, captain Ki Sung-yueng and the team play their final domestic warm-up game before the World Cup. In the breezy evening some wore red attire and waved the national flag. But the Bosnia and Herzegovina team easily breached the Reds’ defense, and groans rang out when opposition winger Edin Visca completed his hat trick to end the game 3-1. “Four days ago, we played against Honduras and won 2-0. The press, everyone, was talking about we are doing well,” Son says.“Four days later we lost, and they’re being negative. But that’s football. And we just need to focus on our football.”

Even with Son, South Korea’s odds at the World Cup are long: FIFA ranks the team 61st in the world. And despite the sport’s popularity in the region, other Asian teams fare little better: Japan ranks 60th and China 73rd. (Asia’s women’s teams rank higher.) What would it take to bring Asian nations into contention with the European and South American stalwarts at the top of the FIFA rankings? Hanjin Chun, general secretary of the Korea Football Association, says that while Asian stars like Son playing in Europe drum up enthusiasm at home, “you can’t have every player in your national team playing abroad.” A stronger domestic league “is a must,” he says.

It’s clear that Son enjoys being an elder statesman for the younger players on the squad. He benefited himself from the advice of his father Son Woong-jung, a player in the domestic K-league before he sustained a career-ending injury at age 28. The elder Son helped his son hone his technique, and meticulously drilled his once weak left foot. He also repeatedly warned of how physically and mentally exhausting the game could be. As a kid with big dreams, Son says, that advice went over his head, “but at 25, I know what he means.” Son wears a splint on one of his fingers from a recent injury. A scar runs along the inside of his forearm, which he broke last year helping South Korea qualify for the World Cup.

He’s made less visible sacrifices too: his agent says that when he goes out in Seoul, he wears a cap and a surgical mask—commonly worn here when people are sick—to avoid being mobbed by fans. These are minor costs, though. “I want to play football until my body says, ‘You can’t run any more, you’re dead,’” he says. “Football is my happiness.” And with that, Son’s smile comes beaming back.

With reporting by Charlie Campbell/Beijing and Stephen Kim and Ha Yeon Kim/Seoul

June 07, 2018 at 09:10PM ClusterAssets Inc., https://ClusterAssets.wordpress.com

#Time #world #news #ClusterAssets #ClusterAsset #Cluster Asset Inc.#ClusterAssets Inc.

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jerrymcguireau · 7 years

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Markets Live: Banks put ASX on front foot The Sydney Morning Herald

Sarah Turner and Patrick Commins

252 reading now

Shares enjoy a positive start to the week’s trade after Wall St cracked new records on Friday night, with the big banks and Macquarie leading the gains.

Australia’s three-year bond yield has climbed to the highest since December 2015 amid rising speculation that the RBA will follow its UK and Canadian counterparts in turning hawkish. The three-year rate has climbed for the sixth straight session to 2.16 per cent, to bring its rise over the past week to over 8 per cent.

The bonds are starting to look very appealing, CBA head of debt research Adam Donaldson told Bloomberg. “It’s probably time to go long,” he said, pointing to a string of “quite solid” economic data, such as last week’s employment figures.

“That has seen the market starting to consider whether the RBA could be tightening policy earlier than previously thought.”

Futures markets are pricing in at least one rate hike over the next 12 months.

Evolution Mining is selling its Edna May mine in Western Australia to Ramelius Resources for $90 million.

It will receive $40 million in cash and up to $50 million in contingent payments consisting of a royalty payment once Ramelius has produced 200,000 ounces of gold from current tenements and a milestone payment when Ramelius starts a cut back of the current open pit.

“While the headline $90 million appears reasonable, the majority of the form and timing of this consideration is contingent upon decisions made by the purchaser,” RBC analyst Paul Hissey notes.

“Under the transaction, Ramelius get a 200,000 ounce holiday from royalty payments (we forecast Edna May to produce around 90,000 ounces per annum).

“Following this, the royalty payment of either $100 and ounce or $60 an ounce plus $20 million cash and/or shares, is predicated on Ramelius’ decision to undertake a cutback at Edna May.”

As a result of the sale, Evolution lowered its 2018 financial year gold production guidance to between 750,000 and 805,000 ounces, from 820,000 – 880,000 ounces.

Shares are down 0.4 per cent.

A red hot 28 kilogram gold bar. Photo: Waldo Swiegers

The Reject Shop is one ASX-listed retailer whose biggest problem isn’t the looming entry of Amazon into Australia.

The deep discount retailer, which sells up to 7,000 different items including stationery, metal birdhouses, soap, garden pots and pet care products from a network of 347 stores, simply doesn’t have an online delivery business because the average spend of its customers is too low to justify the economics of having a delivery charge and transporting the goods to their home.

The Reject Shop managing director Ross Sudano said the company had done extensive research in the United States, Canada and the United Kingdom on the deep discount market, and while Amazon is a formidable force in retail generally, the low-priced items which the deep discount retailers have as their core business, mean they are largely immune.

The price points of most of their goods are too low, for even the might of Amazon to make a meaningful dent, so the online giant largely steers clear.

“The discount segment has been growing strongly in the US despite Amazon being such a strong player in retail,” Mr Sudano said on Monday.

The average basket size of shoppers in The Reject Shop stores is between $10 to $15 on each trip, as they pick up basic items like tissues, shampoo and detergent, and perhaps a trinket or two that weren’t expecting to find.

“It’s the rummaging, the finding something they didn’t expect to find. That element is almost impossible to replicate online,” he said.

Shares are down 1.2 per cent.

Read more here

The Reject Shop customers couldn’t care less about Amazon.

Melbourne has a tight residential vacancy rate of 1.7 per cent and that will fall lower by 2019 as new housing supply slows due to less investment by local and foreign buyers, SQM Research says.

But while vacancy rates in Melbourne and Sydney (2 per cent) were unchanged in August from July, an improvement in other capitals painted the picture of residential markets in the rest of the country starting to move after years of stagnation or even being in reverse, the latest figures from consultancy SQM Research show.

The country’s tightest residential market is Hobart, where the residential vacancy rate slipped to just 0.4 per cent last month – the lowest recorded for any capital since SQM started tracking the figures in 2005.

Darwin recorded the sharpest decline for the month with vacancy rates falling to 2.5 per cent in August from 2.9 per cent July. The NT capital has now recorded seven straight months of falling vacancy rate, suggesting the downturn in its rental market is over.

But with a vacancy rate of between 2 per cent and 3 per cent indicating a market in equilibrium, the outlook for Melbourne backs up suggestions – such as that made by consultancy BIS Oxford Economics last week – that the city, like Sydney, will suffer from a shortage of dwellings, rather than a surplus.

“There is nothing in our numbers to suggest the market is about to be hit with oversupply,” SQM managing director Louis Christopher said on Monday.

“Dwelling completions should peak in early 2018. And given the pronounced year-on-year declines in building approvals, we believe rents will likely rise at a faster pace in 2018 than what has been recorded in 2017, thus far. We now have mounting concerns for significant rental shortages in 2019 for Sydney and Melbourne.”

Brisbane, already suffering a glut of apartments, also saw a tighter vacancy rate in August, down to 3.1 per cent from 3.3 per cent in July.

Industry group Urban Development Institute of Australia supports the argument of an undersupply. A report it published last month argues that new housing construction estimates based on dwellings approvals numbers regularly overestimate the number of new homes that will actually be created because the development of sites in established areas involves the demolition of at least one existing dwelling.

If you only read the headlines – or, say, my columns – you might be pessimistic about China’s economy. Recent news has been dominated by a crackdown on capital outflows, worries about rapid debt growth, and efforts to rein in a risky overseas investment binge, writes Christopher Balding on Bloomberg.

Yet ordinary Chinese are highly optimistic: The China Consumer Confidence Index hit 114.6 in July, a level not seen since 1996. This is a logical reaction to some significant improvements in China’s economic outlook. And for the government, it offers a key opportunity for reform.

By basic welfare measures, Chinese have every reason to be confident. The official unemployment rate has dropped below 4 per cent . Real estate prices are still rising, with broad gains even in so-called tier-2 or tier-3 cities.

Stock markets in Shenzhen and Shanghai are both up by about 9 per cent this year. Foreign-exchange reserves have been rising. The yuan has strengthened so much that the central bank is making it easier for traders to take short positions. Even non-performing loans are holding steady.

It’s no wonder China’s confidence seems to extend well into the future. The Consumer Expectation Index hit 117.4 in July, the highest reading since 1993, according to the National Bureau of Statistics. Indexes measuring confidence among stock investors and economists have also surged recently, thanks to a strong labor market, robust growth and rising asset prices.

Although such metrics are often imprecise, they matter enormously – because confidence can be self-reinforcing. As long as China’s investors have confidence in a market or asset, prices can diverge from fundamentals for a long time.

Real estate has reached $US858 ($1070) a square foot in Beijing not because of income fundamentals but because buyers are confident prices will continue rising by 10 per cent a year. Similarly, although China’s banking system is in bad shape, the government has propped up confidence – and staved off bank runs – by quashing rumours and reassuring anxious depositors.

Confidence is a fragile thing, however, and there are reasons to think the good times won’t last.

Read more here

Canton Road in the Tsim Sha Tsui area of Hong Kong. Photo: Hong Kong Back to top

If only investors in shipping had the equivalent of a mariner’s tide tables. They can see where the low water mark in share prices lies, but must divine for themselves how high the waters might now rise, writes the FT’s Lex Column.

In this particular cycle, the ebb lasted a long time after container lines ordered too many ships and then struggled to fill them. The low point was probably last autumn, when Korean line Hanjin filed for bankruptcy.

The market has improved markedly since then. Industry volume growth is expected to hit 5 per cent this year, from 3.8 last year. Scrapping rates have picked up, while new capacity on order is finally falling.

Such newfound discipline might last longer than in previous cycles because consolidation has increased the market share of the top six operators to almost two-thirds, from two-fifths in 2013. Four alliances have become three. In other industries – airlines, for instance – concentration of this sort led to greater self control.

Such developments have not gone unnoticed. Antitrust regulators have raised concerns about the shrinking number of alliances and their control over certain routes. And the Dax global shipping index has risen 15 per cent (in dollar terms) since January.

Some individual shipping lines have risen more. Hapag-Lloyd, which recently posted a 80 per cent increase in earnings before interest, tax, depreciation and amortisation for the six months to June, is up 35 per cent.

That is considerably better than Maersk, the other major quoted European shipper. The number of analysts rating the Hamburg-based group’s shares a buy has doubled.

That partly reflects its merger with UASC, completed in May, which made the company less dependent on chartered ships and containers. Those savings, plus increased volumes, helped cancel out a 57 per cent rise in fuel costs. Travel group Tui sold its remaining stake in the company, removing an overhang.

Based on 2017 forecasts and its current market value, the group has a free cash flow yield of over 8 per cent. In Hamburg at least, high tide could still be some way off.

The shipping market has improved. Photo: Nicolo Filippo Rosso

China’s home prices rose in the fewest cities since January, adding to signs of a real estate industry slowdown as officials persist with curbs to limit the risk of bubbles.

New-home prices, excluding government-subsidised housing, in August gained in 46 of 70 cities tracked by the government, compared with 56 in July, the National Bureau of Statistics says. Prices fell in 18 cities from the previous month and were unchanged in six.

Average new home prices in China’s 70 major cities rose 0.2 per cent in August from a month ago, slowing from an 0.4 per cent gain in July, as policymakers battle to rein in an overheated market.

New home prices rose 8.3 per cent in August versus a year ago, slowing from a 9.7 per cent increase in July, Reuters calculated from the NBS data.

China’s almost two-year-long property boom hit fever pitch last August when prices jumped 1.5 percent in a month.

While regulators have intensified their crackdown on property speculation in more than 45 major cities, the buying frenzy came to smaller centres this year as local governments offered cheap credit and imposed few restrictions in the hope of clearing a housing glut.

But many analysts still expect the sector to gradually lose momentum over the rest of the year in the face of continuous policy tightening and an official financial deleveraging campaign.

Home sales increased last month at the slowest pace in almost three years, according to data released last week.

Chinese policymakers are trying to engineer a soft landing for the hot property market. Photo: AP

The under-pressure board of AGL Energy looks set to avoid an embarrassing “second strike” at next week’s annual shareholders meeting after two powerful proxy advisers recommended investors back the remuneration report.

But the proxy firms, ISS and CGI Glass Lewis, still voiced concerns about chief executive Andy Vesey‘s high pay, which has also been the subject of criticism in Canberra amid intense scrutiny of the utility’s plans to close its Liddell power station in NSW.

Pay for senior executives and directors in AGL, including Mr Vesey, “remains well above peers”, noted ISS, which is also critical of the company’s use of underlying profit to determine executive performance.

But ISS, which last year recommended investors reject the remuneration report, said AGL has made enough improvements to its pay structure to warrant supporting report this time.

“Overall the company paid more than its peers and performed about the same as its peers,” said CGI Glass Lewis.

It noted that Mr Vesey’s fixed pay is about 30 per cent higher than the median of peers and said it views high fixed pay “with scepticism” because it is not directly linked to performance “and may serve as a crutch when performance has fallen below expectations”.

However it noted the board had already determined Mr Vesey would not receive an increased in fixed pay this financial year and deemed his remuneration “appropriate at this time”.

“Whilst we’ve noted our concerns with the CEO’s fixed remuneration, given the company’s performance and growth since Mr Vesey’s appointment we do not believe this is a concern for shareholders at this time,” CGI Glass Lewis said. “We will however monitor an further changes to the CEO’s remuneration levels going forward”.

Shares in AGL have jumped close to 40 per cent in the past 12 months, making the stock by far the best performer in the benchmark utilities index.

Looks like AGL Andy Vesey has one fewer thing to worry about. Photo: Andrew Meares

Iron ore is facing renewed pressure and risks sliding back into the $US60s, as China’s economy shows signs of cooling and global mine supply increases, while planned steel capacity cuts in the world’s biggest consumer this winter could further cut demand.

Ore with 62 per cent content in Qingdao fell 2.5 per cent to $72.13 a dry tonne on Friday, the lowest level since July 28, extending the previous day’s 3.4 per cent loss, which was the most since May, according to Metal Bulletin. The commodity, which almost hit $US80 in August, posted the first back-to-back weekly decline since June.

Chinese iron ore futures are off another 0.7 per cent this morning, threatening to extend their losing streak to three days in a row.

Local iron ore miners are feeling the pressure this morning, with Fortescue off 2 per cent and (much) smaller peer Mt Gibson down 1.8 per cent. Rio Tinto is pretty flat, while BHP, which also moves with the energy sector, is ahead 0.6 per cent.

The steel-making raw material is in retreat after a slew of negative outlooks, with Barclays saying the commodity is “living on borrowed time”. Industrial output and retail reports from China this week suggested an unexpectedly slower pace of growth. While capacity cuts to curb pollution in Asia’s top economy are set to hurt consumption, a further expansion in mine supplies from Brazil and Australia also threatens prices.

Much of iron ore’s recent strength has been spurred by strong demand within China, but that’s about to change, according to a Sept. 13 report from Barclays, which said its economists see an “impending end” to macroeconomic support. While the bank didn’t give a price forecast, it has said previously it sees an average of $US50 by the fourth quarter.

But Australia’s major miners would still make healthy profits at $US60 a tonne because of the difference between that price and their production costs, as well as healthy prices for other commodities such as coal (metallurgical and thermal), and copper.

“Any price at $US55 and above you’re going to have Rio, BHP and Fortescue all generating very healthy levels of cash flow,” Morgans analyst Adrian Prendergast said.

Sydney’s outer suburbs recorded auction clearance rates below 50 per cent this week and more homes sold prior to auction as Australia’s biggest housing market showed further signs of cooling.

The weakness in Sydney’s mortgage belt suburbs delivered the fourth week out of five with an overall clearance rate below 70 per cent on a busy weekend with almost 2500 auctions held across the capital cities.

Sydney house prices have risen just 0.3 per cent over the past three months, according to research house CoreLogic, with some economists and analysts tipping up to a 10 per cent fall in prices after a five-year bull run. Last week ANZ forecast Melbourne house prices to rise 8.4 per cent compared with 5.4 per cent in Sydney.

Fairfax-owned Domain recorded a 67 per cent preliminary clearance rate in Sydney this week with almost 800 auctions scheduled. This was up on last week’s 63 per cent, but well below the 78 per cent clearance rate recorded at the same time last year when there were fewer than 600 auctions.

Adding to the picture of a weakening market, 148 homes in Sydney sold prior to auction, up from 145 last week and 109 the previous week, according to Domain, a sign that vendors have less confidence in achieving a higher price at auction.

Listed real estate agents McGrath sold 34 out of 66 homes this weekend prior to auction, achieving a clearance rate of 57 per cent, down from 63 per cent last weekend.

“We’re back to the underlying trend of lower clearance rates in a Sydney market that has run out of puff,” said Domain Group chief economist Dr Andrew Wilson.

“We had very low results in the Western suburbs, which have been a downward force on the market. Western Sydney, southwestern Sydney and the north-west all had clearance rates well under 50 per cent.

“It shows the two-speed nature of the market with the inner suburbs, where buyers are less discretionary, still very strong [with around 80 per cent clearance rates],” Dr Wilson said.

Auction clearance rates are signalling more weakness in some Sydney property markets. Photo: Sarah Keayes Back to top

Billionaire media mogul Bruce Gordon has lost a court bid aimed at thwarting the sale of Network Ten to America’s CBS after the NSW Supreme Court threw out his case against administrators of the free-to-air broadcaster.

Mr Gordon, through his companies WIN Corporation and Birketu, took urgent legal action on September 6 to prevent Ten’s administrator, KordaMentha, from holding a second creditors’ meeting last week to vote on the CBS proposal.

The meeting was delayed until tomorrow.

The administrator backs the sale of Ten to CBS.

Mr Gordon’s companies had also asked the court to make a range of orders and declarations, including that KordaMentha’s second report to creditors failed to include adequate information about the bid for Ten made by Birketu and Lachlan Murdoch’s Illyria Nominees.

The companies also sought orders that would either reduce or eliminate CBS’ voting rights on the takeover proposal.

CBS is Network Ten’s largest creditor, with Ten holding a $172 million debt to the US group.

This morning, NSW Supreme Court Justice Ashley Black said he was “not satisfied” that lawyers for Mr Gordon’s companies had established any deficiencies in the creditors’ report that would require orders to be made.

He was also not persuaded that CBS should have its voting rights reduced or removed.

Since the case was heard urgently last week, Birketu and Illyria have made a fresh bid for Ten.

A spokesman for KordaMentha said the creditors’ meeting would go ahead tomorrow.

WIN television owner Bruce Gordon lost his court bid to thwart the sale of Ten to CBS. Photo: Rob Homer

Shares are enjoying a solid start to the week’s trade, led by the major banks and inspired by Friday night’s gains on Wall Street. The Aussie is holding at 80 US cents.

The ASX 200 has reclaimed the heady heights of the 5700s, climbing 32 points or 0.6 per cento to 5727. As mentioned, the Big Four are driving the gains, with CBA and Westpac up 0.9 per cent, NAB up 1.1 per cent and ANZ advancing 0.7 per cent. Macquarie has climbed 1.5 per cent.

Miners are on the nose with iron ore off Friday night, although BHP is flat as energy stocks managed some gains. Rio is down 0.7 per cent, South32 0.5 per cent and Fortescue 1.8 per cent. Gold miners are also tracking lower amid the lift in general optimism.

Investors seem to like talk of Fairfax Media and Seven West Media hooking up, however tentative those plans may be, with Fairfax up 1.6 per cent and Seven West 1 per cent ahead.

Winners and losers in the ASX 200 this morning. Photo: Bloomberg

9:54am on 18 Sep 2017

Banks are wading back into the market for interest-only home loans, cutting fixed interest rates as the industry grows more comfortable with a regulatory cap on higher-risk lending.

Lenders including Commonwealth Bank, ANZ Bank and Suncorp last week cut some of their fixed interest rates, including for customers with interest-only loans, who have been targeted by regulators this year in a bid to cool the housing market.

The rate cuts, which come at a time that is traditionally strong for property sales, suggest banks want to lift their growth among property investor and interest-only customers after clamping down on these buyers earlier in the year.

The Australian Prudential Regulation Authority has this year forced banks to cut the proportion of new home lending that is interest-only to less than 30 per cent, which has led to tighter credit for these buyers in recent months including higher rates and tougher rules on deposits.

However, there are signs some of this pressure is now easing. Interest rate comparison website Mozo said almost a third of the lenders in its database had cut one of their fixed rates since the start of August.

CBA, the nation’s biggest bank, last week cut four and five-year fixed rates by between 0.1 and 0.2 percentage points, including for interest-only customers, amid a flurry of similar cuts over the last month.

ANZ Bank also cut its two-year fixed loans rate for customers only paying interest on their loans by 0.1 percentage points, to 4.64 per cent. In contrast, it raised two-year principal and interest fixed rates by 0.31 percentage points, to 4.34 per cent – a move that narrows the premium interest-only customers are being charged.

APRA chairman Wayne Byres noted the changes last week, saying these were a sign lenders were trying to lift their growth towards the limit imposed by APRA.

“There are some banks that have announced some shaving of certain fixed rates and other things—because they are clearly trying to recalibrate to get just inside what we would like to do, but no more,” Mr Byres said.

Have banks gone too far? The slowdown in interest-only lending is a likely reason why the property market has slowed. Photo: Louise Kennerley

9:43am on 18 Sep 2017

Welcome to a world of ‘Quantitative Tightening’

Eyes of the world’s financial market fall, and firm plans to unwind its $4.47 billion balance sheet. This video was produced in commercial partnership between Fairfax Media and IG Markets.

9:30am on 18 Sep 2017

Here’s AFR’s Karen Maley on the US Federal Reserve which may give the green light to start shrinking its $US4.2 trillion ($5.25 trillion) balance sheet as soon as this week:

Can the US central bank slash its massive balance sheet in half without triggering a fresh outbreak of turmoil in financial markets?

That’s the big question for investors ahead of the US Federal Reserve Open Market Committee meeting this week, at which the US central bank is expected to give the long-awaited green light to start shrinking its bloated balance sheet.

Investors are betting that the US central bank can pull off this risky manoeuvre without disruption and they demonstrated their optimism by pushing the US share market to a record high at the end of last week.

The Fed has already signalled that it will move at a glacial pace, with analysts expecting that its balance sheet will only shrink by $US10 billion in each of October, November and December, for a total $US30 billion by the end of the year.

This means that any tightening in financial market conditions caused by the Fed’s move will be more than offset by the European and Japanese central banks which are still buying bonds with gusto, and which are expected to inject around $US400 billion into financial markets in the final three months of the year.

But not everyone is confident that markets will enjoy a smooth ride as the Fed picks up the pace of its balance sheet shrinkage, which it expects will reach a peak of $US50 billion a month.

“There is a good chance it does not go well,” warns Deutsche Bank’s chief strategist, Dominic Konstam in his latest research note. He points out that when the Fed reduces its balance sheet, other buyers will have to step in and buy US bonds and mortgage-backed securities in its place.

Read more here

Janet Yellen of the US Federal Reserve. Photo: Pablo Martinez Monsivais Back to top

9:18am on 18 Sep 2017

Here’s all of Friday’s action in numbers:

SPI futures up 16 points or 0.3% to 5708

AUD -0.1% to 80.01 US cents (Range: 79.87 – 80.35)

On Wall St: Dow +0.3%, S&P 500 +0.2%, Nasdaq +0.3%

In New York, BHP -1.8% Rio -0.7%

In Europe: Stoxx 50 -0.3%, FTSE -1.1%, CAC -0.2%, DAX -0.2%

Spot gold -0.7% to $US1320.76 an ounce

Brent crude +0.1% to $US55.54 a barrel

US oil flat at $US49.87 a barrel

Iron ore -2.5% to $US72.13 a tonne

Dalian iron ore -2% to 500 yuan

LME aluminium -0.6% to $US2085 a tonne

LME copper +0.1% to $US6508 a tonne

10-year bond yield: US 2.20%, Germany 0.43%, Australia 2.74%

On the economic calendar:

New motor vehicle sales August

China property prices July

Euro zone CPI August

UK Rightmove house prices September

US NAHB housing market index September

Broker changes:

Automotive Holdings cut to hold at Morningstar

F&P Healthcare cut to sell at UBS

Macquarie Atlas Raised to Add at Morgans Financial

9:13am on 18 Sep 2017

Local stocks are poised to lift to start the week after the Standard & Poor’s 500 topped 2500 for the first time as technology stocks recovered their upward momentum and as investors dismissed somewhat disappointing US retail sales and industrial output data.

ASX futures were up 16 points. Iron ore retreated and the Australian dollar ended flat.

The pound surged after an unexpected hawkish tilt at the Bank of England’s policy meeting last week, the most dovish member of the committee Gertjan Vlieghe said a rate hike could happen in the “coming months.”

In the coming days, there will be the release of the minutes from the Reserve Bank’s latest meeting on Tuesday, and speeches by RBA chief economist Luci Ellis on Wednesday and then governor Philip Lowe on Thursday.

Over the same time, US policymakers gather for a scheduled meeting at which they are expected to approve the paring back of the Federal Reserve’s $US4.5 trillion balance sheet.

The Fed’s balance sheet swelled over the last few years as the Fed bought bonds as part of its effort to keep lending costs low so that both businesses and individuals would be encouraged to help spend the US economy back to health.

The Dow Jones Industrial Average rose 0.29 per cent on Friday to end at 22,268.34 points, while the S&P 500 gained 0.18 per cent to 2500.23, records for both. The Nasdaq Composite added 0.3 per cent to 6,448.47.

In Europe, the pan-European STOXX 600 and euro zone stocks both fell 0.3 per cent, while the export oriented FTSE slumped 1.1 per cent as the pound spiked higher.

In Hong Kong on Friday, the Hang Seng index rose 0.1 per cent, to 27,807.59 points, while the China Enterprises Index lost 0.3 per cent, to 11,067.55 points.

Shanghai stocks fell on Friday to end the week lower, as a slew of soft data suggested the world’s second-largest economy is starting to lose some momentum in the face of rising borrowing costs and government-mandated capacity cuts.

Traders work the floor at the New York Stock Exchange. Photo: MARK LENNIHAN

9:13am on 18 Sep 2017

Good morning and welcome to the Markets Live blog for Monday.

Your editors today are Sarah Turner and Patrick Commins.

This blog is not intended as investment advice.

Fairfax Media with wires.

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Markets Live: Banks put ASX on front foot – The Sydney Morning Herald