Morning Wrap: ASX 200 futures flat, S&P 500 and Nasdaq higher thanks to Amazon + Westpac FY25 results

ASX 200 futures are down 5pts (-0.04%) as of 8:30 am AEDT.

In a nutshell:

• Major US benchmarks higher but largely thanks to Amazon (+9.5%) surging on better-than-expected results

• Amazon reported robust Q3 earnings as AWS revenue accelerates to highest level since 2022

• China will effectively suspend implementation of additional export controls on rare earth metals and terminate investigations targeting US companies in the semiconductor supply chain

Let's dive in.

S&P 500 SESSION CHART

S&P 500 higher in a relatively rangebound session (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks higher but off best levels

• Equal-weight S&P 500 (+0.22%) higher after falling for three straight sessions (down -2.39% vs. S&P -0.77%)

• Big tech mostly lower, as Meta (-2.7%) continued to slip post earnings and Apple (-0.3%) choppy despite favourable takeaways, 

• Amazon (+9.5%) boosted the Discretionary sector and benchmarks on Q3 AWS acceleration and margin expansion

• US weekly recap: Nasdaq (+2.24%), Dow (+0.75%), S&P 500 (+0.71%), Russell 2000 (-1.36%) 

• US monthly recap: Nasdaq (+4.70%), Dow (+2.51%), S&P 500 (+2.27%), Russell 2000 (+1.76%)

• S&P's nears 7,000 mark as investors eye Q3 earnings, AI and rate risks (BBG)

• Tech giants pouring billions into AI and data centres but market punishing some stocks that aren't delivering on near-term rewards (BBG)

• Japan 2Y bond auction draws solid demand following dovish remarks from Governor Ueda (BBG)

• Clean-energy stocks have rebounded despite White House pressure, buoyed by data centre energy requirements (BBG)

STOCKS

• Amazon reports larger-than-expected acceleration in AWS revenue, marking fastest rate of growth since 2022 (BBG)

• Apple CEO Tim Cook forecasts strong iPhone sales during holiday season after China delays and supply constraints impacted Q4 (RT)

• Berkshire Hathaway operating earnings up 34% year-on-year while cash position hit yet another new record (CNBC)

• Broad mentions of OpenAI on corporate earnings calls underscore the firm's dominance over AI and the broader market (AX)

• Meta sees very strong demand for its $30bn bond sale, suggesting investors are looking past concerns about AI spending plans (BBG)

• Cloudflare surges on Q3 earnings beat, AI innovations, and strong revenue growth (SA)

• Netflix explores blockbuster bid for Warner Bros. Discovery in streaming power play (RT)

• Saint-Gobain tops Q3 sales estimates as European recovery offsets North American slump (INVT)

• Audi cuts 2025 margin target, faces tariff and supply challenges (BBG)

TARIFFS

• White House says China will halt rare-earth export controls, US to extend pause on various tariffs for another year (BBG)

• Trump says his recent "G2" meeting with Xi will lead to "everlasting peace and success" (TS)

• US-China trade thaw offers Europe temporary relief but risks marginalising EU priorities on Ukraine and raw materials (POL)

CENTRAL BANKS

• Fed's rate cuts fail to boost US economy, signaling potential December pause (RT)

• Fed Governor Waller says labour-market concerns still pointing toward a cut in December (BBG)

• Fed's Miran says continued tight policy runs the risk of inducing a recession (NYT)

• Kansas City Fed's Schmid defended dissent against Wednesday's 25 bp rate cut, saying he believes the labour market in balance, economy has momentum, and inflation remains too high (FED)

• Barclays halts ECB rate cut forecasts until 2027, citing steady policy amid Eurozone resilience (RT)

• RBA rate hike looms by February after inflation surge (NTLY)

ECONOMY

• Tokyo core inflation accelerates by more than expected, supporting case for resumption of BOJ rate hikes (RT)

• China's factory activity contracts for seventh month amid fading export orders (RT)

ASX TODAY

• AGL preparing to cut hundreds of jobs amid cost cutting efforts to fund surge in renewable energy and battery storage investments (The Aus)

• Westpac reports FY25 results, net profit down 1% to $6.9bn vs. $6.8bn ests, net interest margin down 1 bp to 1.94% (in-line with ests), total dividend up 1% to 153 cps vs. 152 cps ests (WBC) 

• Westpac selling its $21.4bn RAMS mortgage portfolio to Pepper Money, KKR2 an PMICO consortium (WBC)

WHAT TO WATCH TODAY

• Not a whole lot: A pretty quiet overnight lead and morning so far. Overnight ETF watchlist relatively mixed, with tech-related ETFs mostly higher and resource-related ETFs lower. The ASX may still be digesting the ramifications of that hot CPI print last week, with some economists now talking up a potential rate hike next year. Iron ore is on the cusp of a year-to-date high, with prices currently floating around US$107 a tonne. Gold slipped 0.5% overnight but still above US$4,000/oz, though gold miner ETF slightly lower. Westpac earnings read very in-line at first glance, though the stock is up 19.5% YTD.

BROKER MOVES

Broker data is still pending.

Stocks trading ex-dividend: 

• Mon 3 Nov: Alcoa Corporation (AAI) – $0.108, La Trobe Private Credit Fund (LF1) – $0.012, Pengana Global Private Credit Trust (PCX) – $0.013, Rand Mining Ltd (RND) – $0.10, Revolution Private Credit Income Trust (REV) – $0.013, Tribune Resources Ltd (TBR) – $0.20

• Tue 4 Nov: Wam Leaders Ltd (WLE) – $0.047

• Wed 5 Nov: Naos Ex-50 Opportunities Company Ltd (NAC) – $0.015, Naos Small Cap Opportunities Company Ltd (NSC) – $0.013

• Thu 6 Nov: Wam Global Ltd (WGB) – $0.065

Other ASX corporate actions today:       

• Dividends paid: Alliance Aviation Services (AQZ), Harvey Norman (HVN), Mantle Minerals (MTL)  

• IPOs: None

• AGMs: None

Economic calendar (AEDT):

• 11:00 am: Australia TD-MI Inflation Gauge (Oct)

• 11:30 am: Australia Building Permits (Sep)

• 11:30 am: ANZ-Indeed Job Ads (Oct)

• 11:30 am: Australia Household Spending (Sep)

• 2:00 am: US ISM Manufacturing PMI (Oct)