ASX 200 Live Today - Thursday, 29th October

Welcome to our live ASX coverage for Thursday, October 29. Expect a high volume of posts pre-market and more periodic updates throughout the day. We'll be wrapping the blog up around 2:00 pm AEST. Let us know how we can make it even better.

PYC Therapeutics holds $655m as three clinical readouts line up for 2027

[9:22 am] PYC Therapeutics advanced all four of its RNA drug programs in the September quarter, with key clinical readouts due next year and enough cash to fund the pipeline into 2030.

• Cash and investments of $655m, which PYC says funds all four programs into 2030

• Net operating outflow of $14.9m, including $21.4m in R&D payments

• Kidney disease program moved to a higher 2.4mg/kg dose in its repeat-dose study, with data due in 2027

• Phelan-McDermid program entered the toxicology studies required before human trials, which are expected to start in 2027

• Optic atrophy program proof-of-concept data from repeat dosing is due in 2027

• Retinitis pigmentosa program is using long-term data to prepare for a potential registrational trial in 2027

Company page: PYC Therapeutics (PYC)

Perpetual flags return to partially franked dividends once Wealth sale completes

[9:19 am] Perpetual’s board told shareholders the sale of its Wealth Management business to Bain Capital remains on track to complete this year and should leave the group debt free, as it defended its rejection of EQT’s takeover approach.

• The Wealth Management sale is on track to complete by the end of 2026, with Bain Capital paying $500m upfront

• Perpetual expects to move into a net cash position after the sale

• Franking credits from the sale may support partially franked dividends from 2H27

• The board stands by its rejection of EQT’s $22.50 a share proposal

• Annualised cost savings reached $72.6m, on track for up to $80m by the end of FY27

• Proxies show 94.3% support for the remuneration report

Company page: Perpetual (PPT)

Champion Iron amends debt covenants as loss deepens despite record sales

[9:18 am] Champion Iron sold a record volume of iron ore in the September quarter but slipped further into the red as lower prices, higher shipping costs and elevated fuel prices squeezed margins, and it amended its debt covenants to cope with current market conditions.

• Revenue fell 18% y/y to C$403.9m despite record sales of 4.5Mdmt

• Adjusted EBITDA fell 87% y/y to C$23.3m

• Net loss of C$48.4m, vs a C$56.8m profit a year earlier

• Net realised price fell 30% y/y to C$89.9/dmt, below all-in sustaining costs of C$97.9/dmt

• Covenants on its senior secured facility were amended to provide more flexibility, with total debt of C$1,303.1m

• First commercial shipment of direct reduction quality product completed, with commercial production targeted toward the end of FY27

Company page: Champion Iron (CIA)

Develop’s Woodlawn hits record throughput but lower grades cut metal output 21%

[9:11 am] Develop Global pushed record volumes through its Woodlawn copper-zinc mine in the September quarter, but a decision to mine lower-grade ore outside the mine plan weighed on metal output.

• Woodlawn processed a record 201,130t of ore, up 17% q/q

• Copper-equivalent (CuEq) production fell 21% q/q to 3,697t as processed grade dropped to 1.47% CuEq from 2.73%

• Concentrate sales of 19,614t generated $57.4m in revenue

• Operating free cash flow of $29.6m, while $58.6m was invested in growth projects

• First lithium ore mined at Pioneer Dome, with the first direct shipping ore cargo on track for the December quarter

• FY27 Woodlawn guidance unchanged at 21-23.5kt CuEq (midpoint 22.25kt), with October feed grade back at 2.9% CuEq

Company page: Develop Global (DVP)

Lynas hits record NdPr output and prices but flags month-long Malaysian shutdown

[9:11 am] Lynas delivered its strongest quarterly revenue since mid-2022 in the September quarter as production recovered from the concentrate quality problems that hit the June quarter, though planned maintenance will weigh on December quarter output.

• Sales revenue up 55% y/y to $310.1m, the highest since the June quarter of 2022

• Average selling price up 88% y/y to a record $102.1/kg, with floor price agreements now covering more than half of production

• NdPr production up 4% y/y and 12% q/q to a record 2,082t

• Sales volumes down 18% y/y to 3,039t

• Cash and short-term deposits steady at $1,212m after a roughly $50m equity investment in magnet partner JS Link

• December quarter production will be lower due to a one-month planned maintenance shutdown at Lynas Malaysia

Company page: Lynas Rare Earths (LYC)

JB Hi-Fi flags October slowdown ahead of Christmas

[9:07 am] JB Hi-Fi’s first-quarter sales landed broadly in line with UBS across its three main brands, but a slowdown in October puts the crucial Black Friday and Christmas trading period in focus.

• JB Hi-Fi Australia comparable sales down 1.4% vs ests of down 1.3% (in line), with total sales down 0.4%

• The Good Guys comparable sales down 0.4% vs ests of down 0.5% (in line), with total sales down 0.1%

• JB Hi-Fi New Zealand comparable sales up 10.7% vs ests of up 11.0% (slight miss), with total sales up 17.3%

• Sales slowed in October, while ests pencil in a modest improvement to down 1.1% for JB Hi-Fi Australia comparable sales in weeks 14–26 of 1H27

• Customers remain focused on value and are increasingly shopping during promotional events, amid heightened competitive activity

Company page: JB Hi-Fi (JBH)

Super Retail like-for-like sales stall as Macpac slumps 12%

[8:51 am] Super Retail’s like-for-like sales growth has stalled so far in FY27, with every brand slowing from its first seven weeks and three of four now tracking below UBS forecasts for the rest of the half.

• Group like-for-like sales up 0.2%, with total sales up 2.0%

• Supercheap Auto like-for-like sales up 2.5%, slowing from 4.0% in the first seven weeks, with total sales up 3.4%

• rebel like-for-like sales up 0.3%, down from 1.1% in the first seven weeks, implying recent trading is below 2.3% growth ests for weeks 8–26

• BCF like-for-like sales down 1.1% on higher fuel prices, implying recent trading is below 1.9% growth ests for weeks 8–26

• Macpac like-for-like sales down 11.7% on promotional timing and a milder winter, implying recent trading is well below ests of down 3.6% for weeks 8–26

• Supercheap Auto and rebel both grew market share, according to CommBank iQ data

Company page: Super Retail Group (SUL)

Freightways lifts Q1 profit 12% as high fuel prices weigh on demand

[8:42 am] Freightways grew revenue and earnings by double digits in the September quarter, helped by an acquisition and higher fuel recoveries, but expects customer volumes to stay subdued until fuel prices fall.

• Revenue rose 17.6% to NZ$408.3m, driven by higher fuel recovery and the VTFE acquisition

• Operating earnings (EBITA) rose 12.9% to NZ$50.0m

• NPAT rose 12% to NZ$26.2m

• Express package margins fell to 12.2% from 13.3% on weaker demand for premium services and fuel levies that add revenue but no margin

• NZ express package volumes rose 2.9%, with market share gains contributing 2.6 percentage points

• Same-customer volumes are expected to stay subdued in both markets, improving progressively once fuel prices fall sustainably

Company page: Freightways Group (FRW)

Suncorp flags around 3% FY27 premium growth after losing major commercial contract

[8:42 am] Suncorp has updated its premium growth outlook for this financial year after losing a large commercial contract and absorbing a weaker New Zealand dollar, while leaving its margin guidance unchanged.

• FY27 GWP growth guidance of around 3% implies about $15.9bn vs $16.0bn ests (1% miss), with ests pencilling in 4% growth

• The lost commercial contract cuts FY27 GWP by $125m, with the full impact landing in 1H

• The weaker NZ dollar is expected to shave about 70bps off growth in Australian dollar terms

• The underlying insurance margin is expected in the top half of its 10-12% range, modestly skewed to 2H

• All other FY27 guidance is unchanged, including the $250m buyback and restructuring costs of about $30m

Company page: Suncorp Group (SUN)

Bank of Canada hikes to 2.5%, Bank of Japan expected to wait until December

[8:39am] Central banks are responding to higher inflation, with the Bank of Canada raising rates on Wednesday and the Bank of Japan expected to follow in December.

• The Bank of Canada lifted its policy rate 25bps to 2.5%, its first hike since July 2023

• Governor Tiff Macklem said further hikes may be needed, though the bank will proceed carefully

• Canadian inflation is running at 3.1%

• The Bank of Japan is expected to hold at 1.25% at its meeting ending Friday, with none of the economists polled by Bloomberg tipping a hike

• Markets price an 82% chance of a BOJ hike in December, according to Totan ICAP

• Japanese inflation rose 2.1% y/y in September, topping 2% for the first time this year

Oil climbs as US reportedly readies Iran strikes and Tehran rebuffs Qatari peace plan

[8:35 am] Oil rose on Wednesday on reports the US is preparing renewed strikes on Iran after next week’s midterm elections, while Tehran dismissed a fresh Qatari proposal to end the eight-month war.

• Gulf countries were told to prepare for US strikes on Iran after the midterms, according to The Wall Street Journal

• Houthi militants said they struck Saudi Arabia’s Ras Tanura refinery, the kingdom’s largest, with a ballistic missile

• The US Navy told ships to avoid unnecessary Hormuz transits, warning of delays from blockade enforcement

• Iranian attacks on ships hit a wartime high of almost 30 in October

• Qatar presented Iran with a new seven-day peace plan, but a senior Iranian official dismissed it as unacceptable ideas rather than an offer

Hyperscaler credit spreads hit widest levels as AI debt floods the market

[8:34 am] Wall Street is struggling to absorb the wave of debt funding data centres and AI chips, pushing more of the risk onto insurers, pension funds and private lenders.

• Hyperscaler credit spreads are at their widest since the AI buildout drove the big cloud providers into debt markets last year

• Citi said the group trades well wide of where its credit ratings suggest, citing a persistent oversupply of new debt

• Raising data centre funding has become significantly harder in recent months, according to more than 30 bankers, fund managers and private equity executives

• Oaktree co-CEO Armen Panossian warned the credit market is becoming saturated with data centre loans

• Several insurers are nearing or at their limits on data centre exposure, according to a Willis Towers Watson survey in May

• Galaxy Digital CEO Michael Novogratz said nervousness is probably close to peak, pointing to Meta’s equity raise and Anthropic’s planned IPO as signs of relief

UK gilts rally as Healey’s first budget sticks to fiscal discipline

[8:34 am] UK bonds and stocks rose on Wednesday after Chancellor John Healey delivered a well-flagged first budget that reassured investors the government will stick to its fiscal pledges.

• The 10-year gilt yield fell as much as 4bps to 5.30%

• Long-dated gilt issuance was cut 31% to £15.5bn from £22.4bn previously forecast, according to the Debt Management Office

• Total gilt sales of £250.6bn are planned this fiscal year vs £249.2bn ests (0.6% above)

• The budget leaves £15bn of headroom against the government’s fiscal rules in 2029-30, according to the Office for Budget Responsibility

• Bank and gambling stocks led gains on relief that taxes on both sectors were less punitive than feared

• The 10-year gilt yield traded in a 7bp range as of 3pm London time, vs 22bps on the day of Rachel Reeves’ first budget in 2024 and 40bps during Liz Truss’ 2022 mini-budget

Alphabet cloud sales double as search falls short

[8:31 am] Booming AI demand pushed Alphabet’s cloud business past expectations in the September quarter, but softer advertising sales left group operating income short of ests.

• Revenue up 25% to $127.6bn vs $128.22bn ests (in line)

• Google Cloud revenue up 103% to $30.7bn vs $29.15bn ests (5% beat), driven by AI infrastructure and TPU demand

• Search & other revenue of $63.4bn vs $64.99bn ests (2% miss)

• Operating income up 30% to $40.6bn vs $43.23bn ests (6% miss)

• EPS of $2.12 includes a $0.55 hit from an $8.7bn paper loss on Alphabet’s SpaceX stake

Microsoft rises after hours on 48% Azure growth, but new bookings slip

[8:23 am] Microsoft shares rose 2.7% in after-hours trade after the company beat expectations on the top and bottom line in the September quarter, its first under a new segment structure.

• Revenue rose 19% y/y to US$92.28bn vs US$90.63bn ests (1.8% beat)

• EPS rose 18% y/y to US$4.89 vs US$4.73 ests (3.4% beat)

• Azure revenue grew 48% to US$33.17bn, lifting the new Agents and Infra segment to US$76.8bn vs US$75.6bn ests (1.6% beat)

• Contracted backlog rose 73% y/y to US$677bn but was broadly flat on the prior quarter, with new bookings down 12% y/y

• Capex was US$45.2bn including leases, with about three-quarters spent on short-lived assets such as chips and networking equipment

• OpenAI paid Microsoft US$10bn in the quarter, about 11% of revenue and more than Xbox and Windows combined

Source: YahooFinance

Fed holds rates in 10-2 vote as Warsh moves to fewer rate decisions from 2027

[8:22 am] The Federal Reserve held its benchmark rate at 3.75% to 4% on Wednesday without signalling a December hike, with Chair Kevin Warsh saying politics played no role in a decision made less than a week before the US midterm elections.

• Two officials dissented, with Governor Lisa Cook and Cleveland Fed President Beth Hammack both favouring a 25bp hike

• The statement upgraded the pace of growth to strong from solid, while repeating that inflation remains elevated

• One of eight meetings in 2027 will be strategy-only, with no rate decision or statement, rising to two in 2028

• The 2-year Treasury yield fell as much as 4bps to 4.7% as traders read the schedule change as dovish

• Traders price about an 85% chance of a 25bp hike on 9 December, with three hikes in total expected by mid-2027

• The S&P 500 closed up 0.28%, snapping a run of six straight Fed-day losses

Good morning!

[8:20 am] ASX 200 futures are up 40 pts (+0.45%). Here's what happened overnight:

• Major US benchmarks up for a third straight session, with stocks holding up amid a catalyst rich session featuring the Fed and mega cap tech earnings

  • S&P 500 (+0.28%), Equal-weight S&P 500 (-0.04%)

  • Nasdaq (+0.27%), Dow (+0.19%), Russell 2000 (+0.41%)

• Fed held rates in a 10-2 vote with two officials backing a hike, while Warsh announced fewer rate-setting meetings from 2027 and traders priced a December move

• Microsoft rallied 4.5% after hours as Azure growth accelerated to 48%, while Alphabet tanked 9% as an earnings miss overshadowed Google Cloud revenue more than doubling to $30.71bn