Markets Overview

  • ASX SPI 200 futures up 0.6% to 7,300.00
  • Dow Average up 0.5% to 35,411.24
  • Aussie up 0.2% to 0.6741 per US$
  • U.S. 10-year yield rose 3.6bps to 3.8725%
  • Australia 3-year bond yield fell 3 bps to 3.92%
  • Australia 10-year bond yield fell 1.6 bps to 3.99%
  • Gold spot down 0.4% to $1,954.71
  • Brent futures up 2.2% to $82.86/bbl

Economic Events

A pivotal week for markets started with small gains in stocks as traders braced for rate decisions from major central banks and a deluge of corporate earnings.

In the run-up to the Federal Reserve and European Central Bank’s gatherings, investors got a reminder about the side-effects of aggressive policy tightening. Disappointing data from both the US and euro-area added to bets officials are close to ending their hiking cycles to prevent a recession. Aside from the economic picture, global companies with a combined $27 trillion in value were set to report results, including giants Microsoft Corp., LVMH and Samsung Electronics Co.

Other News

Australia is seeking public comments on who qualifies as a tax resident—an individual who is legally obligated to pay taxes in the country—as part of an effort to simplify individual tax residency rules.

The Treasury released a consultation paper Friday detailing a proposed new tax residency framework and asked the public for feedback on a number of provisions, including thresholds for physical presence in Australia, when an individual ceases to be a tax resident in the country, and the overseas employment rule.

The country began evaluating its tax residency rules in 2016, when the Board of Taxation undertook a self-initiated review and concluded the rules were no longer appropriate and needed to be modernized.

In Australia’s 2021-2022 budget the government announced it would replace the existing tax residency framework with new rules, according to the consultation document.

Under the new guidelines, physical presence would be the primary barometer to determine tax residency. An individual who spends more than 183 days in the country—known as “Step 1″ in the new framework — would be considered a tax resident.

The Treasury said if an individual seeks to circumvent the 183-day test to spread out their physical presence over two income years, there would be a second tier of criteria for qualifying as a tax resident.

An individual who doesn’t qualify under Step 1 would undergo a set of tests under Step 2, including meeting a 45-day physical presence threshold and two of four other factors outlined in the consultation. The criteria gauge a person’s connection to Australia, according to the Treasury.

The factors include: a right to reside permanently in the country, having close family ties in Australia, having economic connections, and possessing Australian accommodations such as property or a residence.

Stakeholders have until Sept. 22 to submit their comments.