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I joined Paul Turton on ABC Mornings to discuss how AI is evolving beyond simple prompts into autonomous agents that can act on our behalf, but warned that market expectations may be getting ahead of reality. With trillions set to be spent on infrastructure, current valuations imply adoption levels that look ambitious, raising the risk of overcapacity and corrections, particularly as AI begins to disrupt the software as a service model and pressure established data and information providers.

Listen from 36:40 here: ABC Newcastle Mornings

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by Roger Montgomery Posted in Market commentary, Radio, Technology & Telecommunications.

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Following the release of its Half-Year 2026 (HY26) results, the Australian Stock Exchange (ASX) finds itself at a crossroads, balancing record-breaking volumes with significant regulatory and management hurdles.

Volumes and new models

Despite the noise, the ASX’s core business is thriving. The HY26 results showed a significant growth beat, driven primarily by cash volumes, clearing, and bonds, with daily trading volumes having surged above $8 billion. Continue…

by Roger Montgomery Posted in Market commentary, Market Valuation, Stocks We Like.

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by Roger Montgomery Posted in Foreign Currency, Market commentary, TV Appearances.

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• POSTED IN Foreign Currency, Market commentary, TV Appearances.

If you’ve spent any time on social media lately, you’ve seen them: sleek, metallic bipeds performing backflips in China, dancing to Motown, or gingerly stacking the dishwasher or placing a singular box on a shelf. The robotics hype cycle suggests that in four years’ time (2030), a robot will be folding your laundry and helping your nanna out of bed.

Despite billions of dollars invested, however, they remain science experiments confronting daunting technical challenges. Continue…

by Roger Montgomery Posted in Market commentary, Technology & Telecommunications.

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Having returned to work after a little rest and respite, I was recently confronted, nay, berated, by headlines about Labor’s deal to slash borrowing costs for electric vehicles (EVs) as it scrambles to meet climate targets.

While I was away, I saw the chart in Figure 1 and immediately realised the futility of our efforts to influence the global climate, concluding that Labor’s schemes appear to be driven by ideology rather than evidence. Continue…

by Roger Montgomery Posted in Energy / Resources, Manufacturing, Market commentary.

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As we have outlined here on the blog many times over the last year, there just doesn’t seem to be enough money in the hands of potential customers to pay for artificial intelligence (AI) tools that would give hyperscalers a decent return on their intended capital expenditure.

The more they spend, the more revenue and profit they must generate to produce a meaningful return on capital. But the more they invest through capital expenditure, the more competition there’ll be between them (lowering prices for their commoditised products) or the greater the level of overcapacity (also lowering prices).

And when you think about the companies in this race, the capital expenditure (capex) is transforming them from cash-generative, capital-light, high-margin businesses whose services have become verbs into capital-heavy, highly indebted businesses. Continue…

by Roger Montgomery Posted in Market commentary, Technology & Telecommunications.

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Interest rates act like gravity on the value of all assets. The lower the rate, the weaker the gravitational force, allowing asset prices to float higher. The Federal Reserve (the Fed) has cut 175 basis points since the current rate-cutting cycle began on September 18, 2024. Since that time, the U.S. stock market, as measured by the S&P500, has risen 22.4 per cent.

As important as interest rates are for asset values, they are perhaps even more important to sentiment, when investors believe they are set based on economic data rather than the whims of politicians – whose own agendas may seek to destroy the benefits of monetary policy when driven by an independent central bank. Continue…

by Roger Montgomery Posted in Economics, Market commentary.

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I was fascinated by this morning’s Australian Financial Review (AFR) article, which pointed out markets appear to be disconnected from reality in the Middle East.

Comparing the current and more disruptive war in the Middle East to Russia’s invasion of Ukraine in 2022, which was far less disruptive to energy markets, the author notes:

“Back in 2022, Brent crude peaked at $US139 a barrel, compared with $US102 now. Back then, European gas peaked at €339 a megawatt hour, compared with €51 now. Back then, the price of urea, an oil by-product vital in the production of fertilisers, peaked at $US910 a tonne, compared with $US660 now. Back then, the S&P 500 fell 25 per cent peak-to-trough. Today, the index is down just 5.5 per cent from its January record high.” Continue…

by Roger Montgomery Posted in Economics, Global markets, Market commentary.

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I joined Sean Aylmer on Fear and Greed to look back at some of the key themes that shaped markets in 2025, including the hype surrounding in artificial intelligence (AI) stocks and the growing case for small caps. We also talked about the rise in gold and silver as the U.S. dollar weakened, and what those moves could signal for investors.

We then looked ahead to 2026, discussing why markets may become more volatile and how diversification into assets uncorrelated to traditional markets could help support portfolios. We covered Digital Asset Funds Management’s Digital Income Fund and how its digital arbitrage strategy aims to benefit from market volatility, and explored how Aura’s Private Credit Income Fund can provide income and returns with no correlation to sharemarkets.

You can listen to the episode on Fear and Greed here: The bull and bear cases for equities in 2026.

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by Roger Montgomery Posted in Aura Group, Digital Asset Funds Management, Economics, Insightful Insights, Investing Education, Market commentary, Podcast Channel.

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I know everyone, at the moment, is focused on the Middle East, oil prices and inflation, and some are also considering the second and third-order effects on, for example, plastic and food supply chains. But while investors are distracted by geopolitical tensions, another, potentially even sharper, transition in artificial intelligence (AI) is occurring that began at the end of last year and is accelerating.

For a while, Large Language Models (LLMs) like Gemini, ChatGPT, Grok and their ilk captured our imagination. AI felt like a sophisticated parlour trick – you ask a question and receive an answer, a more efficient web search, an online adviser or even a chat companion. And even now, the majority of those who use AI are still employing it this way. But that’s all about to change. Continue…

by Roger Montgomery Posted in Market commentary.

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