Labour Market Still Relatively Tight
Australian bond yields and the dollar saw slight increases following data release from the Australian Bureau of Statistics indicating that the job market remains relatively tight. ABS head of labour statistics, Bjorn Jarvis, noted an increase in employment by 50,000 people and a rise in the number of unemployed by 10,000, leading to a slight unemployment rate increase to 4.1%. The participation rate rose to 66.9%, just shy of the historical high of 67% from November 2023. With high job vacancies and near-peak employment ratios, the labour market’s tightness persists despite the unemployment rate being above 4% since April.

Reserve Bank’s Perspective on Labour Market
The Reserve Bank of Australia monitors labour market strength closely as it influences interest rate decisions. A robust job market reduces the likelihood of interest rate cuts. Currently, the unemployment rate is expected to reach 4.2% by the end of 2024, compared to the 4.1% rate in June. The employment-to-population ratio increased slightly to 64.2%, near its November 2023 high of 64.4%. These figures, combined with the high participation rate, suggest a continued tight labour market, crucial for the Reserve Bank’s monetary policy considerations.

Goldman Sachs Neutral on Domino’s
Goldman Sachs has maintained a neutral rating on Domino’s Pizza stock, with a price target of $36.30 per share, following the company’s decision to close stores in France and Japan. The broker views these closures as proactive steps towards a quality franchise network for sustainable growth. Despite the closures, Domino’s reported strong performance in Australia, Germany, and Singapore. Goldman forecasts earnings of $1.34 per share for financial 2024 and $1.64 for financial 2025. Currently, the stock is down 8.5%, trading at $33.02.