Latest news with #US2.7
The Age
4 days ago
- Business
- The Age
In a world of conflict, the spoils are rich from gold and guns
The Stockholm International Peace Research Institute (SIPRI) estimated that global military expenditure hit a record $US2.7 trillion ($4.1 trillion) in 2024, an increase of 9.4 per cent in real terms from the previous year, and the steepest annual jump since the Cold War ended. 'If 5 per cent [of GDP] becomes baseline, defence stocks stop being cyclical – they become structural. And that changes everything.' Stephen Innes, SPI Asset Management SIPRI highlighted the 'guns or butter' cost to social programs from the rising spending on weaponry. 'As governments increasingly prioritise military security, often at the expense of other budget areas, the economic and social trade-offs could have significant effects on societies for years to come,' warned SIPRI researcher Xiao Liang. The big beneficiaries from this war trade are traditionally US defence giants, such as Northrop Grumman – maker of the B-2 stealth bombers and intercontinental ballistic missiles – which is now trading near multi-year highs. Virginia-based RTX, which makes the Javelin and Stinger missiles that were used heavily in the Ukraine war, has also hit record highs. But the changing nature of warfare, where computer-guided drones and new technology such as AI are coming to the fire, has thrown up some new winners. Shares of US tech group Palantir have soared more than 400 per cent in a year as the company cements its place in the US industrial military complex. And investors are also noticing the impact in Europe, where Germany's new government signalled a seismic shift in March, with plans to lift strict spending controls to create a €500 billion ($896 billion) fund for defence and security. It has had a massive impact on European stocks. Italy-based aerospace, defence and security firm Leonardo, German sensor technology company Hensoldt, and British aerospace and defence company Babcock International have seen their share prices more than double over the last year. Korea's Hanwha Aerospace is another EU beneficiary, and its share price has soared 200 per cent over the same period. Even Australia benefits, as shown by Hanwha recently acquiring a 9.9 per cent stake in local shipbuilder Austal, with plans to double its investment. Austal shares have tripled since last September, thanks to its contracts with the US Navy. ASX-listed DroneShield – a maker of anti-drone technology – has tripled since February. And right on cue, it announced a $61 million European military order on Wednesday for handheld detection and counter-drone systems. This one deal exceeds its entire revenue for 2024. Three ASX-listed defence ETFs (exchange-traded funds, which invest in defence stocks globally) from VanEck, Betashares and Global X are all up 50 per cent this year. 'Global defence has been one of the few equity segments that have outperformed the market this year. Flows into ASX-listed global defence ETFs have shot up since March,' VanEck's Jamie Hannah said. The surge in the performance of defence stocks has posed a conundrum for some ethical funds and investment mandates, which have generally precluded any military assets. But investors appear to be coming to the conclusion that Citi reached in 2022: 'Defence is likely to be increasingly seen as a necessity that facilitates ESG as an enterprise as well as maintaining peace, stability and other social goods.' In April, UBS Asset Management – which oversees $US1.8 trillion in investments – scrapped prohibitions that prevented its sustainable funds from investing in conventional military weapons manufacturers. Exclusions still apply to more controversial weaponry such as cluster munitions. Hannah says VanEck already screens out these more controversial manufacturers from its ETF. 'It's very much an area where you need to consider what you're investing in,' Hannah said. Meanwhile, the only controversy over the ultimate defensive asset, gold, is whether it has peaked after a spectacular run over the past year to a record high of $US3500 an ounce in April. This month, a European Central Bank report confirmed that its soaring price, along with bullion buying by central banks, means gold is currently the second-biggest reserve holding by central banks behind the US dollar. Citi highlighted the extraordinary rush to gold with a report saying 0.5 per cent of global GDP was being spent on gold – the most in 50 years of data. And central banks have not been the only buyers. This month, VanEck noted that Australia's most recent export figures included $11 billion in 'non-monetary' gold exports to the US – which is gold acquired by private buyers, not reserve banks, for their foreign exchange reserves. 'This volume of gold exports for the quarter is more than the total non-monetary gold we have shipped to the USA in the last four years, and we think this could reflect a massive increase in demand from investors due to a loss of faith in [the US dollar] and US Treasuries,' VanEck's Cameron McCormack said. While some are getting squeamish after this year's 27 per cent gain for the precious metal, others are expecting its golden run to continue. Wall Street giant Goldman Sachs predicts gold will climb to $US3700 a troy ounce by the end of the year, from about $US3330 currently, as central banks keep buying tonnes of it every month. It could rise even further if investors use bullion as a safe space ahead of interest rate cuts and amid rising recession concerns. 'In the event of a recession, Goldman Sachs Research forecasts that gold could rise to as much as $US3880 a troy ounce,' the investment bank says.
Sydney Morning Herald
4 days ago
- Business
- Sydney Morning Herald
In a world of conflict, the spoils are rich from gold and guns
The Stockholm International Peace Research Institute (SIPRI) estimated that global military expenditure hit a record $US2.7 trillion ($4.1 trillion) in 2024, an increase of 9.4 per cent in real terms from the previous year, and the steepest annual jump since the Cold War ended. 'If 5 per cent [of GDP] becomes baseline, defence stocks stop being cyclical – they become structural. And that changes everything.' Stephen Innes, SPI Asset Management SIPRI highlighted the 'guns or butter' cost to social programs from the rising spending on weaponry. 'As governments increasingly prioritise military security, often at the expense of other budget areas, the economic and social trade-offs could have significant effects on societies for years to come,' warned SIPRI researcher Xiao Liang. The big beneficiaries from this war trade are traditionally US defence giants, such as Northrop Grumman – maker of the B-2 stealth bombers and intercontinental ballistic missiles – which is now trading near multi-year highs. Virginia-based RTX, which makes the Javelin and Stinger missiles that were used heavily in the Ukraine war, has also hit record highs. But the changing nature of warfare, where computer-guided drones and new technology such as AI are coming to the fire, has thrown up some new winners. Shares of US tech group Palantir have soared more than 400 per cent in a year as the company cements its place in the US industrial military complex. And investors are also noticing the impact in Europe, where Germany's new government signalled a seismic shift in March, with plans to lift strict spending controls to create a €500 billion ($896 billion) fund for defence and security. It has had a massive impact on European stocks. Italy-based aerospace, defence and security firm Leonardo, German sensor technology company Hensoldt, and British aerospace and defence company Babcock International have seen their share prices more than double over the last year. Korea's Hanwha Aerospace is another EU beneficiary, and its share price has soared 200 per cent over the same period. Even Australia benefits, as shown by Hanwha recently acquiring a 9.9 per cent stake in local shipbuilder Austal, with plans to double its investment. Austal shares have tripled since last September, thanks to its contracts with the US Navy. ASX-listed DroneShield – a maker of anti-drone technology – has tripled since February. And right on cue, it announced a $61 million European military order on Wednesday for handheld detection and counter-drone systems. This one deal exceeds its entire revenue for 2024. Three ASX-listed defence ETFs (exchange-traded funds, which invest in defence stocks globally) from VanEck, Betashares and Global X are all up 50 per cent this year. 'Global defence has been one of the few equity segments that have outperformed the market this year. Flows into ASX-listed global defence ETFs have shot up since March,' VanEck's Jamie Hannah said. The surge in the performance of defence stocks has posed a conundrum for some ethical funds and investment mandates, which have generally precluded any military assets. But investors appear to be coming to the conclusion that Citi reached in 2022: 'Defence is likely to be increasingly seen as a necessity that facilitates ESG as an enterprise as well as maintaining peace, stability and other social goods.' In April, UBS Asset Management – which oversees $US1.8 trillion in investments – scrapped prohibitions that prevented its sustainable funds from investing in conventional military weapons manufacturers. Exclusions still apply to more controversial weaponry such as cluster munitions. Hannah says VanEck already screens out these more controversial manufacturers from its ETF. 'It's very much an area where you need to consider what you're investing in,' Hannah said. Meanwhile, the only controversy over the ultimate defensive asset, gold, is whether it has peaked after a spectacular run over the past year to a record high of $US3500 an ounce in April. This month, a European Central Bank report confirmed that its soaring price, along with bullion buying by central banks, means gold is currently the second-biggest reserve holding by central banks behind the US dollar. Citi highlighted the extraordinary rush to gold with a report saying 0.5 per cent of global GDP was being spent on gold – the most in 50 years of data. And central banks have not been the only buyers. This month, VanEck noted that Australia's most recent export figures included $11 billion in 'non-monetary' gold exports to the US – which is gold acquired by private buyers, not reserve banks, for their foreign exchange reserves. 'This volume of gold exports for the quarter is more than the total non-monetary gold we have shipped to the USA in the last four years, and we think this could reflect a massive increase in demand from investors due to a loss of faith in [the US dollar] and US Treasuries,' VanEck's Cameron McCormack said. While some are getting squeamish after this year's 27 per cent gain for the precious metal, others are expecting its golden run to continue. Wall Street giant Goldman Sachs predicts gold will climb to $US3700 a troy ounce by the end of the year, from about $US3330 currently, as central banks keep buying tonnes of it every month. It could rise even further if investors use bullion as a safe space ahead of interest rate cuts and amid rising recession concerns. 'In the event of a recession, Goldman Sachs Research forecasts that gold could rise to as much as $US3880 a troy ounce,' the investment bank says.
Sydney Morning Herald
24-06-2025
- Sport
- Sydney Morning Herald
Millionaires in minutes: Your guide to the NBA draft and the Australians who could be picked
How much will they earn? The first pick is expected to earn about $US13.8 million (about $21.3 million) next season and $US14.5 million in season 2026-27. Subsequent picks will earn slightly less on a sliding scale down to pick 30 on $US2.7 million next season. Second-round picks get no such guarantees, but they present great value as clubs can choose to sign players to guaranteed, non-guaranteed or partially guaranteed contracts. They can also 'stash' players (ie: tell them to play overseas until they are needed). Australian guard Johnny Furphy is a good example. Last year he missed out on the first round before the Indiana Pacers drafted him at pick 35 and then offered him a five-year deal, guaranteed for three seasons at a little under $US2 million per season. He's just played in the NBA finals. If a player is drafted, that team 'owns' his NBA rights, and he can only join whichever team has those rights, though they can be on-traded to other teams. Any Aussies in the running? There are no guarantees we will see an Australian follow in the recent footsteps of Josh Giddey or Dyson Daniels and be selected in the first round, but there are a stack of Aussies considered strong chances to be second-round picks. Brisbane Bullets centre Zikarsky, Sydney Kings forward Toohey, Duke University guard Tyrese Proctor and Illawarra Hawks centre Lachlan Olbrich were all listed in ESPN's top 100 players for the draft. At 220 centimetres (7′3) without shoes (7′4 with shoes), Zikarsky is the tallest player in the draft and has attracted strong interest as teams look to players who can, potentially, defend San Antonio superstar Victor Wembanyama who stands 222cm but has a 240cm (8′0) wingspan. Tasmanian sharpshooter Reyne Smith, who finished his US college career with the Louisville Cardinals this past season, is also eligible, although he could potentially miss out on being picked in the draft and head to Europe. Undrafted players could still make their way to the NBA if a team invites them to Summer League or training camp. Going undrafted means any team can sign a player. Matthew Dellavedova is one such Aussie who made Cleveland's roster after not being selected. Many outlets create mock drafts to try and predict where players will end up. To give you an idea how things could end up for the four Aussies, The Athletic 's Sam Vecenie had Proctor going to Brooklyn at pick 36, Toohey going to San Antonio at pick 38, Zikarsky going to Toronto at pick 39 and Olbrich to Utah at pick 53 in his mock draft on June 12. Any NBL Next Stars in the mix? The NBL also has Next Stars forward Izan Almansa in the draft while South East Melbourne Phoenix forward Malique Lewis withdrew from this year's draft and will return to the Australian league for next season in hope of boosting his position for 2026. Almansa, a Spanish international who played with Perth this past season is seen as being on the border between the first and second round. Toohey and Zikarsky are also NBL Next Stars. Why should we care about the Pelicans? The New Orleans Pelicans have picks seven and 23 in the first round and most Australians wouldn't pay attention unless they take a local player, but the Pelicans have a connection to Melbourne this year as they prepare to play two pre-season games at Rod Laver Arena, first against Melbourne United on October 3, then two days later against South East Melbourne. That will likely mean the players taken will make their first NBA appearances in those games. Oklahoma guard Jeremiah Fears shapes as a possible pick at seven for the Pelicans, although they could package both picks and try to trade up for a higher selection. Will there be trades? Oh, yes. The trades have already started, with Indiana and New Orleans swapping a 2026 first-round pick, which goes to the Pacers, for the rights to Australian guard Mojave King and pick 23 in the draft. Current players can also be traded on the night, as can this year's draft picks, future picks and players who were drafted earlier in the night. Silver will announce trades as they become official; some aren't made official by the NBA until after the draft but are reported during the night by broadcasters or journalists. Superstars Kevin Durant (Phoenix) and Giannis Antetokounmpo (Milwaukee) have been mentioned as potentially being traded this off-season, though it looks less likely they will move right now. But nothing is certain when it comes to draft-night trades. There have been some big draft-night trades over the years, including Orlando and Golden State swapping Chris Webber and Anfernee 'Penny' Hardaway during the 1993 draft. What has fashion got to do with the draft? Quite a bit, actually. Players who attend the first round generally wear suits, sometimes custom-made ones, to mark the occasion and decorate their first walk onto the NBA stage. The league also makes special NBA draft hats each year, which players receive after being selected. Those hats can be changed over or swapped if a trade is made. Some suits become famous or infamous, depending on their reception – LeBron James wore an all-white suit when he was drafted in 2002, while Samaki Walker's white hat and jacket in 1996, Drew Gooden's long jacket in 2003 and Jalen Rose's red pinstripes in 1995 still ring out. Loading Roy Ward's mock draft: The top five picks No.1 – Cooper Flagg (Dallas Mavericks) No.2 – Kon Knueppel (San Antonio Spurs) No.3 – Dylan Harper (Philadelphia 76ers) No.4 – Khaman Maluach (Charlotte Hornets) No.5 – Ace Bailey (Utah Jazz) ESPN will show the NBA draft first round on Thursday at 10am (AEST). The second round is Friday at 10am.
The Age
24-06-2025
- Sport
- The Age
Millionaires in minutes: Your guide to the NBA draft and the Australians who could be picked
How much will they earn? The first pick is expected to earn about $US13.8 million (about $21.3 million) next season and $US14.5 million in season 2026-27. Subsequent picks will earn slightly less on a sliding scale down to pick 30 on $US2.7 million next season. Second-round picks get no such guarantees, but they present great value as clubs can choose to sign players to guaranteed, non-guaranteed or partially guaranteed contracts. They can also 'stash' players (ie: tell them to play overseas until they are needed). Australian guard Johnny Furphy is a good example. Last year he missed out on the first round before the Indiana Pacers drafted him at pick 35 and then offered him a five-year deal, guaranteed for three seasons at a little under $US2 million per season. He's just played in the NBA finals. If a player is drafted, that team 'owns' his NBA rights, and he can only join whichever team has those rights, though they can be on-traded to other teams. Any Aussies in the running? There are no guarantees we will see an Australian follow in the recent footsteps of Josh Giddey or Dyson Daniels and be selected in the first round, but there are a stack of Aussies considered strong chances to be second-round picks. Brisbane Bullets centre Zikarsky, Sydney Kings forward Toohey, Duke University guard Tyrese Proctor and Illawarra Hawks centre Lachlan Olbrich were all listed in ESPN's top 100 players for the draft. At 220 centimetres (7′3) without shoes (7′4 with shoes), Zikarsky is the tallest player in the draft and has attracted strong interest as teams look to players who can, potentially, defend San Antonio superstar Victor Wembanyama who stands 222cm but has a 240cm (8′0) wingspan. Tasmanian sharpshooter Reyne Smith, who finished his US college career with the Louisville Cardinals this past season, is also eligible, although he could potentially miss out on being picked in the draft and head to Europe. Undrafted players could still make their way to the NBA if a team invites them to Summer League or training camp. Going undrafted means any team can sign a player. Matthew Dellavedova is one such Aussie who made Cleveland's roster after not being selected. Many outlets create mock drafts to try and predict where players will end up. To give you an idea how things could end up for the four Aussies, The Athletic 's Sam Vecenie had Proctor going to Brooklyn at pick 36, Toohey going to San Antonio at pick 38, Zikarsky going to Toronto at pick 39 and Olbrich to Utah at pick 53 in his mock draft on June 12. Any NBL Next Stars in the mix? The NBL also has Next Stars forward Izan Almansa in the draft while South East Melbourne Phoenix forward Malique Lewis withdrew from this year's draft and will return to the Australian league for next season in hope of boosting his position for 2026. Almansa, a Spanish international who played with Perth this past season is seen as being on the border between the first and second round. Toohey and Zikarsky are also NBL Next Stars. Why should we care about the Pelicans? The New Orleans Pelicans have picks seven and 23 in the first round and most Australians wouldn't pay attention unless they take a local player, but the Pelicans have a connection to Melbourne this year as they prepare to play two pre-season games at Rod Laver Arena, first against Melbourne United on October 3, then two days later against South East Melbourne. That will likely mean the players taken will make their first NBA appearances in those games. Oklahoma guard Jeremiah Fears shapes as a possible pick at seven for the Pelicans, although they could package both picks and try to trade up for a higher selection. Will there be trades? Oh, yes. The trades have already started, with Indiana and New Orleans swapping a 2026 first-round pick, which goes to the Pacers, for the rights to Australian guard Mojave King and pick 23 in the draft. Current players can also be traded on the night, as can this year's draft picks, future picks and players who were drafted earlier in the night. Silver will announce trades as they become official; some aren't made official by the NBA until after the draft but are reported during the night by broadcasters or journalists. Superstars Kevin Durant (Phoenix) and Giannis Antetokounmpo (Milwaukee) have been mentioned as potentially being traded this off-season, though it looks less likely they will move right now. But nothing is certain when it comes to draft-night trades. There have been some big draft-night trades over the years, including Orlando and Golden State swapping Chris Webber and Anfernee 'Penny' Hardaway during the 1993 draft. What has fashion got to do with the draft? Quite a bit, actually. Players who attend the first round generally wear suits, sometimes custom-made ones, to mark the occasion and decorate their first walk onto the NBA stage. The league also makes special NBA draft hats each year, which players receive after being selected. Those hats can be changed over or swapped if a trade is made. Some suits become famous or infamous, depending on their reception – LeBron James wore an all-white suit when he was drafted in 2002, while Samaki Walker's white hat and jacket in 1996, Drew Gooden's long jacket in 2003 and Jalen Rose's red pinstripes in 1995 still ring out. Loading Roy Ward's mock draft: The top five picks No.1 – Cooper Flagg (Dallas Mavericks) No.2 – Kon Knueppel (San Antonio Spurs) No.3 – Dylan Harper (Philadelphia 76ers) No.4 – Khaman Maluach (Charlotte Hornets) No.5 – Ace Bailey (Utah Jazz) ESPN will show the NBA draft first round on Thursday at 10am (AEST). The second round is Friday at 10am.
