Well I think my gloom has been fully defied now ....
Life , innovation, culture and and more .
Even Google has turned up trumps .
The economy IS genuinely picking up and the data in this story in relation to the mining spend ($33.36 billion - down 1.1% does not include $3.5 billion investment from RIO nor what is cming from FMG.
And no one has yet talked about NRW’s diversification strategy into sub divisions/residential estates effected by the Golding purchase and going from strength to strength with a home -hungry, rapidly growing population expanding into the Gold Coast and other areas....
Australian companies, especially those outside the resources sector, have again lifted spending plans for the coming financial year.
In fact, the 11.3% rise in expected spending this financial year is the strongest for the 4th estimate in 19 years.
That’s despite a dip in the September quarter when investment eased 0.5% to $29.5 billion, according to Australian Bureau of Statistics data released on Thursday.
That was well under market forecasts for a 1.0% gain, but that that much better than it looks because the previous quarter was revised sharply higher to show a fall of 0.9% from the first reported 2.5% drop
Importantly, spending on equipment, plant, and machinery grew 2.2% in the three months to September and will prove a boost to economic growth in the third quarter when the National Accounts for the quarter are released next Wednesday.
By industry, investment by mining firms last quarter fell by 2.7% as a 7.4% lift in spending on plant, equipment, and machinery was more than offset by a 5.7% fall in investment on buildings and structures.
Investment in other selected industries — namely services, utilities, telcos and the like — was relatively unchanged while investment at manufacturers rose by 2.7%.
Like mining, spending on plant, machinery, and equipment in these sectors also increased during the quarter.
The National Accounts next week could show GDP rise by between 0.5% and a solid 1% – the data on the current account, wages/salaries sales and government financing transactions next week will determine the final outcome.
The latest estimate (the 4th for the current 2018-19 financial year) came in at $114.1 billion, 11.3% higher than the previous estimate and above most analysts’ expectations of around $104 billion to $112 billion. It was also 4% above the same estimate for the 2017-18 financial year.
The ABS capex survey captures around 60% of total business investment, excluding spending from industries such as agriculture, health and education.
It therefore captures a majority of, but not all investment. Seeing health and the NDIS have been big areas of spending and employment, there could be a considerable under estimate.
The survey also finds it hard to capture spending on software and cloud investment.
A standout was the solid rise in manufacturing investment and investment by power utilities with investment up no less than 75% per cent in the year to June, compared to the previous 12 months, driven by a boom in the renewables sector.
Also strong have been health, tourism and education, with the latter two benefiting from an influx of Chinese visitors and students.
The 11.3% growth in spending didn’t include yesterday’s $3.5 billion plan from Rio Tinto to build a new iron ore mine in WA called Koodaideri (see separate story). Rio Tinto also approved a US$44 million pre-feasibility study into a second stage expansion of the operation in a few years’ time.
Expected 2018-19 spending for Australia’s non-mining sectors rose to $80.7 billion, up more than 6% on a year ago
Within that figure, expected investment at services firms rose to $70.98 billion, some 13.9% higher than the previous estimate offered three months ago. Importantly, it was also 6.8% above the fourth estimate offered for the prior financial year.
Expected investment by manufacturers was revised up to $9.725 billion, 13.2% higher than in the June quarter and 7.4% from the fourth estimate offered for the 2017-18 financial year.
Partially offsetting the improvement in non-mining industries, expected investment among mining companies continued to fall, coming in at $33.36 billion, down 1.1% from the fourth estimate offered in the prior financial year. But the new Rio iron ore mine will push that figure higher.”
NWH Price at posting:
$1.85 Sentiment: Buy Disclosure: Held
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