Latest / ausbiz a.m / 10.08.26 with Henry Jennings, Marcus Today
Transcript
- Andrew: Good morning and welcome to your morning wrap from OSBIS setting up for the day on the Australian share market. It is Monday, August 10th, and we are expecting the local market to add to yes ⁓ last week's ⁓ record gains. ASX Futures up around a third of a percent. Now, in a moment, we'll preview the day ahead with Henry Jennings. First though, a quick wrap of where global markets finished on Friday, and ⁓ global stocks had their strongest weekly gain since May. After a weaker than expected US jobs report, eating fears of an imminent federal rate hike, ⁓ Federal Reserve rate hike, that is, ⁓ while strong earnings and AI enthusiasm outweigh concerns about what's going on in the Middle East. And it was all about the US jobs market at the end of the week with the non-farm payroll support, which was weaker than expected, showing a loss of 23,000 jobs against forecasts of around 80,000, prompting markets to price in a 40% chance that the Fed will hike rates. At its mid-September meeting. So US stocks and bonds rallied as a result on Wall Street, the SP closing up 0.6% at a record high, NASDAQ up along with the Dow. And for the week, the SP gained 3.5%, the NASDAQ up more than 5%, and the Dow climbing around 3%. Among the stocks on the move, SpaceX, that had up around 10% on Friday. And Tesla also moving higher as well. Should also note ⁓ over the weekend Iran saying that a deal with Oman defining new shipping lanes in the Strait of Humors was in the final stages, but it reiterated that the waterway would only reopen once the US met other conditions. In the commodities complex, ⁓ Brent up around one percent to eighty-three dollars a barrel, gold's up two and a half percent at four thousand three hundred and forty dollars, and Bitcoin trading around sixty-five thousand dollars, the Aussie dollar at seventy point seven US cents ahead of the RBA meeting tomorrow. Well, joining us to get across the market moves is Henry Jennings from Markers Today. Henry, good morning. henry: Good morning, Andrew. How are you this morning? Andrew: Very well, not bad for a Monday, I've got to say. So let's well let's start on ⁓ what we saw on Friday though with the US market. ⁓ clearly ⁓ markets liking that ⁓ that softer than expected jobs report. henry: Yeah, I mean it was ⁓ it was pretty good. ⁓ it's amazing how ⁓ far the economists were out yet again. But ⁓ it certainly was a good report. And in some ways it was somewhat strange given the ⁓ you know the World Cup was going on as well. A lot of jobs are not being created or actually lost in the ⁓ hospitality industry. So that was a little bit surprising. But generally, ⁓ certainly it is a positive if you are hoping that the rates will be on hold in the US. The big event that is now shaping up in August. is the Jackson Hole Symposium. And we've seen in the past ⁓ Jerome Powell kind of pivoted at ⁓ at one Jackson Hole some years ago. And we get ⁓ Kevin Walsh making his first Jackson Hole appearance this year. So that's that's going to be critical, as is the CPI in the US this week as well. And of course we've got our own IBA. So it's gonna be an interesting week to say the least. Andrew: Indeed, and obviously also with the reporting season well and truly underway, ⁓ particularly with the focus on the banks. Just before we get to that, ⁓ Henry, obviously the positive market moves on Friday globally at least setting us up for a positive session here locally. henry: Yeah. Yeah, ⁓ certainly the ⁓ the spot I think was up around thirty three points. So yes, we are looking at continuation. Although, you know, as we've seen in the past, lots can happen over the weekend, ⁓ especially with ⁓ the state of the negotiations between the US, Iran and Oman, which ⁓ seem to be still not settled. So ⁓ maybe we were expecting to see some Donald Trump tweets on a Sunday night when he gets a little bored of watching Fox News. So ⁓ we we'll wait and see what that brings. But certainly You know, we are hopeful that there will be some kind of settlement, some kind of ⁓ reopening of the Strait of Humlus. But generally, you know, the market was pretty good on ⁓ on Friday in the US and that's certainly gonna spill over into our market today, which can't be a bad thing. Andrew: So just in terms of those ⁓ reporting, well today we've got ⁓ Westpac and Car Group. Let's let's start with the banks. In fact, we've got ⁓ three out of the big four were reporting this week. What are your expectations? henry: Yeah. Well, I guess, you know, we're we're gonna be looking at bad debts. We're gonna be looking at that net interest margin. ⁓ Westpac and the other three are only trading updates. Commonwealth Bank is actually ⁓ the full results and ⁓ of course the dividend as well. So the other three banks and and Commonwealth Bank they're somewhat out of cycle out of kilter. So it's it's Commonwealth Bank is probably gonna be, you know, the most closely watched, especially given that it fell, what, ten percent last time on its results. So we don't want to repeat of that. As it's been pushing up towards its ⁓ record highs again. So I guess steady as she goes to some respects, ⁓ you know, the the banks are never going to shoot the lights out, let's face it, because they have a captive market, but they have a limited market as well. There's no international expansion. And there is competition in the mortgage market, of course. We've seen that in the banking sector. So they're not going to shoot the shoot the lights out, but they will be solid. ⁓ Commonwealth Bank will be ⁓ probably more important for the market than than Westpac, I have to say. ⁓ more looking at that one on Wednesday. So that is going to be interesting. And, you know, we've got A and Z as well. But ⁓ as I say, they are trading updates as opposed to dividend reports. Andrew: Now also reporting today car group. ⁓ Henry, as we well know, those ⁓ online ⁓ advertising platforms certainly have been under pressure ⁓ given the potential for ⁓ for AI disruption. But also I guess you look perhaps I mean, are we looking at further weakness in in the car market? Are people going to be listing their cars? I mean, how how are you seeing this at the moment? henry: Well I guess ⁓ in some respects, you know, you would imagine that and certainly AI is having an impact on these companies, but whether it's a good or bad impact remains to be seen. But I guess what was interesting and falls into the same basket was ⁓ the REA results ⁓ which came out and there's much gnashing of teeth, etcetera, about REA and ⁓ the effect of the housing slowdown. But the results actually weren't too bad and the market did rally after the results. So whether we'll see the same sort of effect on car group and and as I say, if we've got a bit of a tailwind from the US and a bit of a tailwind from ⁓ from from the futures market, etcetera, we could see ⁓ car push higher as well. Andrew: ⁓ just looking a little further ahead this week, ⁓ notably tomorrow, I think we're due for ⁓ JB Hi Fi. Henry, retail stocks, how are you seeing those at the moment? Obviously, ⁓ there is conjecture about where rates are gonna go. ⁓ the big four banks forecasting we are at the peak of the rate hiking cycle. Does that instill any confidence in you, perhaps for the Australian consumer and therefore those retail stocks? henry: Yeah. I I think, you know, we we've got a very bifurcated market at the moment. ⁓ you know, some people are really suffering quite ⁓ significantly in terms of cost of living pressures and mortgage rate rises. And of course now we've got the fuel price rise ⁓ that's just kicked off again with that ⁓ excise duty ⁓ coming back into play. So some people are really suffering, but some people are doing well, and of course with JB Hi Fi, you've got the added ⁓ benefit and I get emails from them every day saying, you know. Buy this, buy that, upgrade this, etc. Especially on the phone front. ⁓ plenty of new products coming along. And of course, you know, if you want to get the complete benefit of AI, maybe the ⁓ the the device you have needs a bit of an upgrade. So ⁓ i it it's a tricky one. JB Hi-Fi does it better than anybody. So ⁓ you know, the the stock price has rallied off those lows of 70 bucks. Here we are at sort of eighty-four dollars. So I I think you know the consumer. may be dead, but in they may not be quite as dead as we think they are. So I I was in ⁓ one of the big malls on the northern beaches here on on Saturday and you know there were still quite a lot of people out and about. There weren't too many people in David Jones, I have to say, but generally there were a lot of people sort of still out and about ⁓ doing shopping. So ⁓ relatively ⁓ positive I guess on ⁓ on Dav on ⁓ JB Hi Fi. Not But I think, you know, each retailer has to probably be taken on its own merit. And ⁓ you know, some are doing very well, like Universal Stores, ⁓ which ⁓ has been doing, you know, pretty well. And that's a very different demographic in terms of ⁓ much younger demographic and and they've probably given up on buying any kind of property and in which case, you know, they're out there spending money on the latest fashion. So ⁓ Universal Stores has done well. I mean, that's rallied from six bucks to nearly eight bucks in the last ⁓ couple of months. So You know, there are some success stories out there and as ⁓ Oscar Wilde I think or Mark Twain said, you know, the rumours of my death have been greatly exaggerated. So maybe the same appeals ⁓ to ⁓ to retail stocks. Andrew: Yeah, right. so Henry, any particular stocks you're most looking forward to that sort of pivotal results for them this this month? henry: well I I I think, you know, that there's probably ⁓ three, only because they're so widely held by retail investors. Commonwealth bank, we have talked about. I think also CSL, ⁓ in terms of how much progress they've actually made behind the scenes. Of course, they don't actually have a new ⁓ permanent CEO at the moment, Gordon Naylor is ⁓ is in charge for the time being. But it's gonna be interesting to see how much progress they've made. ⁓ the same really for Cochlear as well. Again, another very widely held retail favorite, which has been struggling to say the least. And that's a ⁓ to some extent a little bit of a retail stock, very high priced retail stock in terms of the product they sell. So those three C's ⁓ certainly ⁓ are are on my radar. The other ones, I guess, you know, we'd like to see ⁓ some Some better times ahead maybe for WiseTech and Zero. So those results are going to be closely watched as well. But they're later in the month. And zip as well, I think is going to be interesting. But there there's a whole bunch, especially in that technology space, given that the technology sector has been so so unloved. ⁓ although we have had quite a big bounce off the lows. But ⁓ you know, Wise Tech got down below thirty bucks. Here we are at forty one dollars. So, you know, that there's been some pretty big bounces in these things already. So whether w that will continue remains to be seen. But certainly the results are gonna be the key feature of ⁓ of the s of the season this this this year with ⁓ with technology stocks. Andrew: Well, Henry, enjoy your day ahead. In fact, I think I'm gonna be catching up with you ⁓ later this afternoon to get across on on the telly, in fact, here at OSBIS, ⁓ to just ⁓ unpack some of those results. henry: Yes. Well. We are. We are, so it's gonna be exciting. Looking forward to that, Andrew. Andrew: All right, thanks, mate. Henry, thanks for joining us from Marcus today. And that is your Osbier's morning wrap. I hope you have a great day. I'm Andrew Gagan. Thanks for listening. henry: My pleasure.