Economists say jobs data is proof that labour market is weakening as RBA 'desires', ASX ends higher — as it happened (2024)

• ASX 200: +1.7% to 7,881 points (final figures below)
• Australian dollar: -0.2% at 66.79 US cents
• S&P 500: +1.2% to 5,308 points
• Nasdaq: +1.4 % to 16,742 points
• Spot gold: steady at $US2,394/ounce
• Brent crude: +0.5% to $US83.16/barrel
  
• Iron ore:-0.6% to $US114.20/tonne
• Bitcoin: -0.3% at $US65,757

Prices current around 4:15pm AEST.

Updates on the major ASX indices:

Thanks for your company throughout the day.

We'll be back to do it all again tomorrow for the final time this week, but until then you can catch up on today's developments below, ordownload theABC News appandsubscribe to our range of news alertsfor the latest news.

You can also catch The Business with host Alicia Barry tonight at on ABC News at 8:45pm, after the late news on ABC TV, and anytime on ABC iview.

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The ASX200 has ended 1.7% higher at the close of trade to 7,881 points — making it the best day of the year for the local share market and within reaching distance of its all-time high.

The positivity on the local market was due to better-than-expected jobs data, with the unemployment rate rising to 4.1% in April according to the ABS.

That's essentially ruled out the prospect of future rate hikes by the RBA and put potential cuts back on the table.

On the sectors front, 10 out of the 11 ended higher, withenergythe only recorded loss, dipping by 0.3%.

Interest rate-sensitive sectors had the strongest performance, with real estate gaining the most (+3.8%), followed by technology (+3.2%), consumer discretionary (+2.5%) and financial (+1.9%).

As for the top performing stocks for the day:

• Aristocrat Leisure +12.3%
• Charter Hall +6.3%
• Incitec Pivot +5.3%
• NetWealth Group +5.1%
• GPT Group +4.7%

Meanwhile at the other end:

• Strike Energy -8.2%
• IDP Education -4.4%
• Arcadium Lithium -4.4%
• Sandfire Resources -2.4%
• Kelsian Group -2.3%

RBA assistant governor Sarah Hunter says rising prices and government moves to streamline approvals are prompting more property developers to plan new housing supply.

However, there are signs that the worst of the downturn may soon be behind us, but Ms Hunter warned the audience of real estate agents at a conference in Hobart that it's still early days.

"We are hearing reports from our liaison program that some developers can see the strength in underlying demand and expect to respond with new supply (although it is early days)," she said.

"Federal and state government initiatives that streamline the approvals and build process will also reduce costs, which will ultimately lift supply.

"But it will not be a quick fix. Demand pressure, and so upward pressure on rents and prices, will remain until new supply comes online."

You can continue reading this story frombusiness editor Michael Jandabelow👇

The e-script provider has posted the below on their website:

"MediSecure has identified a cyber security incident impacting the personal and health information of individuals. We have taken immediate steps to mitigate any potential impact on our systems.

"While we continue to gather more information, early indicators suggest the incident originated from one of our third-party vendors.

"MediSecure takes its legal and ethical obligations seriously and appreciate this information will be of concern. MediSecure is actively assisting the Australian Digital Health Agency and the National Cyber Security Coordinator to manage the impacts of the incident. MediSecure has also notified the Office of the Australian Information Commissioner and other key regulators.

"MediSecure understands the importance of transparency and will provide further updates via our website as soon as more information becomes available. We appreciate your patience and understanding during this time."

By national health reporter Elise Worthington

The ABC can confirm e-script provider MediSecure is the health organisation at the centre of the large-scale ransomware data breach announced by the National Cyber Security Coordinator today.

MediSecure's website has been pulled, and the company has posted a statement saying it has identified a cyber security incident impacting the personal and health information of individuals.

MediSecure is a prescription exchange service, which facilitates electronic prescribing and dispensing of prescriptions.

The company says it has taken immediate steps to mitigate any potential impact on its systems, and believes the incident originated from a third party vendor.

It says it is actively assisting the Australian Digital Health Agency and the National Cyber Security Coordinator to manage the impacts of the incident.

That question was put to Betashares' chief economist David Bassanese shortly after the unemployment data for April was released by the ABS.

While he doesn't have a crystal ball, Mr Bassanese says the unemployment rate could rise to about 4.3% by the end of 2024— but he notes that the RBA thinks it could reach 4.5%, and the government believes it could hit 4.5% by next June.

Regardless, he says any increase to the unemployment rate won't be far from where it is currently.

That said, he also points out that unemployment is still at historically very low levels.

"Hopefully it's only a moderate slow down in the labour market, a rebalancing if you like of the labour market, from what has been very tight conditions, to somewhat more balanced conditions," he says.

You can watch his full assessment of where unemployment — and the RBA — could go from here in his chat with finance presenter David Chau below 👇

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A major health organisation in Australia has been affected by a large-scane ransomware data breach.

The organisation, which is yet to be named, notified security authorities yesterday, and Home Affairs Minister Clare O'Neil says she's been briefed on the incident.

In a statement, the National Cyber Security Coordinator says the AFP is investigating and a whole-of-government response is underway.

You can follow this developing story below:

The head of price statistics for the Australian Bureau of Statistics, Bjorn Jarvis, notes that the employment-to-population ratio remained steady at 64% flat in April.

He said that it indicates "recent employment growth is broadly keeping pace with population growth".

"This suggests that the labour market remains tight, though less tight than late 2022 and early 2023," he said.

Mr Jarvis noted that the employment-to-population ratio has remained above 64% (in trend terms) since June 2022, and is well above its pre-pandemic level.

Treasurer Jim Chalmers has issued a short statement in responseto the latest labour market data for April, released by the ABS.

He says the figures are proof that Australia's economy is feeling the effects of rate hikes, but noted the "remarkable" achievement that new jobs are still being created.

(The ABS data shows that 38,500 more jobs were created last month.)

Here's his full statement below:

"These new numbers show we are still creating new jobs even as the unemployment rate has ticked up and the labour market is softening.

"It shows again what’s been clear for some time now that a weaker global and domestic economy and the rate rises already in the system are having an impact.

"It’s a remarkable fact that amidst all the uncertainty the Albanese Labor Government has still overseen the creation of 820,000 new jobs, by far the most of any first term government."

Expert reaction is steadily flowing through after the April jobs data was released a short time ago — andBDO economics partner Angus Magnusson says it's further proof that any rate cuts hinge entirely on how inflation comes down.

Looking at today's data (and yesterday's wage growth data), he says both align with Treasury and the RBA's expectations that the labour market will lose momentum over the year, but unemployment will stay below pre-COVID levels.

"With unemployment remaining around 4% and wage growth slowing down, the question again comes down to inflation," he says.

"If the Treasury is successful in bringing down inflation mechanically through their cost-of-living budget by the end of the year and the RBA interprets this as real progress, then we can expect to see the first rate cut by the end of the year.

"However, if the RBA believes that this budget will stoke inflation, it will probably adopt a 'wait and watch approach' and allow inflationary pressures from cost-of-living measures to run their course.

"I think this case is more likely and we should not expect a cash rate cut before next year."

The ASX 200 is still trading sharply higher at lunch, up 1.6% to 7,880 points as of 12:20pm AEST.

(Remember you can get live updates on the major indices at the top of the blog.)

With a surge like that, it's not surprising that almost all sectors are solidly in positive territory — with interest rate sensitive sectors like real estate, technology and consumer discretionary stocks leading the charge. (They're up 3.5%, 3% and 2.4% respectively).

As for the other sectors, financial is up 1.7%, industrials and communications are up 1.6%, and health care and consumer staples are 1.5% higher each.

Looking at the top five performers so far:

• Aristocrat Leisure +10.1%
• Graincorp +6.3%
• Xero +5.7%
• Gold Road Resources +5.5%
• Nanosonics +5%

Meanwhile the biggest declines have been recorded by:

• Strike Energy -8.2%
• Arcadium Lithium -4.7%
• Kelsian Group -2.5%
• IDP Education -1.9%
• Beach Energy -1.9%

In the minutes since the ABS dropped the April unemployment data, the ASX200 has ticked up even more — currently it's up sharply by 1.7% to 7,885.7 points as of 11:50am AEST.

The jump on the local share market is led by gains in the interest rate sensitive sectors, including real estate and tech stocks — they're up 3% and 2.4% respectively.

We'll take a closer look at the local market and how it's tracking at lunch shortly.

The increase to the unemployment rate in April is a sign that Australia's tight labour market is finally beginning to loosen, according to Betashares chief economist David Bassanese.

He says overall, the data is a "fairly mixed report" but the unemployment rate is still quite low compared to historical standards.

"Overall, I think what this is showing is that the labour market is starting to lose the capacity to absorb the influx of new workers from high immigration, to the extent it's been able to over the past year.

"So in that sense, the labour market is weakening a little bit. Jobs aren't as readily available as they used to be, worker bargaining power is easing more or less in line with what the RBA anticipates, and I hate to say, desires.

"It does think the labour market is too tight, so some gradual softening of the labour market going forward can help reduce inflationary pressure and wages pressures as the RBA expects.

"It lends itself toward the next move in rates being down, rather than up."

The unemployment rate has risen to 4.1% in April, according to the latest data from the ABS.

The participation rate also increased slightly by 0.1 percentage point in April, with employment rising by about 38,000 people.

"The unemployment rate rose to 4.1 per cent and the participation rate increased to 66.7 per cent," said the ABS' head of price statistics Bjorn Jarvis.

"The 30,000 people increase in unemployment reflected more people without jobs available and looking for work, and also more people than usual indicating that they had a job that they were waiting to start in."

Economists had generally predicted the unemployment rate to rise to 3.9% in April.

The Australian share market has risen on open, up 1.3% to7854.

Consumer discretionary is the industry faring the best, while industrials is doing the worst

Here are the top and bottom movers:

Our reporter Nassim Khadem has this piece out today on the little accounting trick in this week's federal budget where billions of dollars of spending are shifted off-balance sheet by classifying it as investment.

Read more about just how the figures were put together and whether the budget will help deal with longer-term challenges:

As we mentioned, a key event today will be unemployment figures, out later this morning.

NAB analysts predict 30,000 jobs to be added in April and an unemployment rate of 3.9%, though they note

"Some caution is warranted in interpreting month to month employment gains given high volatility."

Last month Australia's headline unemployment rate increased slightly to 3.8%, after employment fell by 7,000 people and unemployment rose by 21,000 people.

The small drop in employment led to the unemployment rate lifting 0.1 percentage points, up from 3.7% in February.

We will bring you the latest jobs figures when the ABS releases them at 11:30am AEST this morning

Former Australian prime minister Scott Morrison met with former US president Donald Trump yesterday, and he tweeted us an update on how it all went and what was discussed, including a photo from an unmistakably Trumpian location:

He confirmed they met at Trump Tower where Mr Morrison said Mr Trump gave a "warm reception" to the AUKUS defence pact - which he has never publicly endorsed.

That's raised questions about whether the former president — who has questioned America's commitment to some international alliances — would support AUKUS if re-elected in November.

Central to the pact is a plan to supply Australia with American-built nuclear-powered submarines.

More from our US correspondents here:

Global stock markets rose to record highs after data showed consumer prices in the US rose less than expected in April, giving investors hope inflation was on its way down and that the Federal Reserve would cut interest rates this year.

Wall Street's major indexes recorded record highs, as did Europe's main share index.

As we reported earlier the US consumer price index was up 3.4%, below the previous month's 3.5% rate, which Oliver Pursche, senior vice president and adviser at Wealthspire Advisors told Reuters "was a good report".

"As we've been talking about, progress is being made on the inflation front, but it is uneven. So I don't think this changes the Fed's trajectory or plan, but it should give investors and consumers confidence that we're moving in the right direction"

Investors had recently dialed back expectations for interest rate cuts given the persistence of inflation but this most recent data has reignited hopes of rate cuts.