After a period of outperformance over the last 12 months, valuations are now seemingly full across the spectrum of high-growth tech companies with PE multiples now at elevated levels. While the valuations of these companies appear expensive prima facie, by taking a more nuanced view of valuation we are confident the Focus Portfolio’s positions in Xero, Hub24 and Technology One can continue to outperform over the medium-term.

The Australian equity market continues to hit new highs, aided by a powerful global upswing and widespread central bank easing. In this report, we look at the outlook for the future performance of Australian equities that have only moderate prospects for earnings growth.

Rio Tinto (RIO) has become the first large multinational miner to acquire a major lithium business, after its recent offer to acquire Arcadium Lithium (LTM) for an equity value of ~A$9.9bn. In this report, we look at how the deal not only represents attractive value for LTM shareholders, but also a vote of confidence in the long-term fundamentals of the lithium market.

The oil price has pushed sharply higher over the last week amidst an escalation of conflict in the Middle East. We expect oil prices to remain buoyant over the medium to long-term, with upside risks over the near-term from the evolving situation in the Middle East. The Focus Portfolio remains overweight energy, albeit our preferred exposure has shifted from Woodside Energy to Santos.

A week after the US Federal Reserve cut interest rates by 50 basis points, the RBA once again left the official cash rate on hold last week. In this report, we look at the impact on markets of the RBA’s decision to refrain from following the lead of the Fed, and the likely timeline for an eventual rate cut.

The extraordinary rally in the Big 4 banks is difficult to reconcile with the fundamentals, with the sector trading at an all-time PE multiple despite having a tepid earnings growth outlook. The sector’s strength can be partly attributed to the rotation of capital into the major banks as a source of ‘relative safety’ compared to the under-pressure resources sector.

Global growth momentum has softened somewhat in recent months, led by slower growth in the world’s major economies. In this report, we assess prospects for the global economy, against a developing global rate cut cycle, structural challenges in China and the uncertainty created by the US election.

Webjet (WEB) is in the final stages of demerging its well-known Webjet B2C business (principally the Webjet online travel agent), from its lesser-known - but much larger -B2B business, WebBeds. We expect the spin-off to drive a re-rate of WEB’s combined market valuation as the strong growth outlook of WebBeds should be more appropriately valued by the market as a stand-alone business.