The US Congress has held its first public hearing in half a century on unidentified flying objects (UFOs) or what the Pentagon calls ‘unidentified aerial phenomena’ (UAP).

But aliens are not the main concern, more so that the objects could belong to Russia or China flying some sort of next-generation technology in American airspace.

Democratic Rep. André Carson of Indiana, the chairman of the panel holding the hearing, said UAPs are a potential national security threat and “they need to be treated that way.”

“For too long, the stigma associated with UAPs has gotten in the way of good intelligence analysis,” he said.

“Pilots avoided reporting or were laughed at when they did. DOD officials relegated the issue to the back room, or swept it under the rug entirely, fearful of a sceptical national security community.”

“Today, we know better. UAPs are unexplained, it’s true. But they are real. They need to be investigated. And any threats they pose need to be mitigated.”

Interestingly, deputy director of naval intelligence, Scott Bray did flag that China has its own version of a UAP taskforce – but neither country is likely to share and compare data on the subject.

 


 

To Markets …

 

The ASX 200 is down 108.70 points or 1.51% at midday today to 7,074.00.

Investors are likely to be focusing on quarterly earnings due later in the week in China, KGI Securities analyst Chua Hit Tong said in a note.

Investor sentiment may be improving thanks to Chinese Vice Premier Liu He’s expression of support for the technology sector’s development and Shanghai’s plans to gradually ease its lockdown, he added.

 

NATO membership could spell more tension

European shares closed lower on Wednesday, with the pan-European Stoxx Europe 600, French CAC 40 and German DAX were more than 1% adrift as investors fret about inflation and potential recession in parts of the global economy.

“Growth fears are back it seems, driving equities and oil prices lower this afternoon,” says IG analyst Chris Beauchamp. “That stocks can’t even manage a decent rebound after their heavy losses should tell investors that we are not in the bull market of 2021 any more.”

Investors are also monitoring whether Russia’s war against Ukraine could further bolster geopolitical tension.

Finland and Sweden formally applied for NATO membership on Wednesday, a move that, if approved, would fundamentally transform the security landscape of Northern Europe.

 

US retailers feel the heat

US stocks fell sharply, with two of the major indexes suffering their worst day since 2020, as the latest set of disappointing earnings from large retailers raised investors’ fears of a recession.

Major retailers said their profits were hurt by rising costs, sluggish sales and supply-chain disruptions.

Shares in Target sank 25%, or $53.67, to $161.61 after the company posted quarterly earnings that missed analysts’ expectations, its worst one-day performance since Black Monday in 1987. Ouch.

“We’re seeing a continued shift in the composition of consumption, moving away from goods and back toward services,” said Garrett Melson, a portfolio strategist at Natixis Investment Managers. “Naturally, that’s going to weigh on these goods retailers.”

 

ASX SMALL CAP WINNERS

 

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Accounting software company Reckon (ASX:RKN) will sell its Accountants Practice Management Group for $100 million in an all-cash deal.

Most of the proceeds are proposed to be returned to shareholders via a partially franked special dividend.

Following the transaction, $100m market cap Reckon “would be a focused, cloud-based business with exposure to high growth markets in Australia and the United States that delivered ~$50 million in revenue and EBITDA of $17 million in FY2021,” the company says.

 

ASX SMALL CAP LOSERS

 

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