Morning Wrap: ASX 200 futures flat, S&P 500 snaps six-week streak of gains

ASX 200 futures are trading 2 points lower, down 0.02%, as of 8:30 am AEDT.

Major US benchmarks struggled as gains from major tech names failed to offset losses in defensive and yield-sensitive sectors, China's economy slowdown deepens after industrial profit plunge, BHP and Vale seals $30.7bn compensation for Brazil dam disaster.

Let's dive in.

S&P 500 SESSION CHART

S&P 500 lower, finished at worst levels (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks finished mostly lower, with the S&P 500 finishing around breakeven from session highs of 0.91%

• S&P 500 snapped a six-week streak of gains, while the Nasdaq logged its seventh straight weekly gain

• US weekly recap – Nasdaq (+0.16%), S&P 500 (-0.96%), Dow (-2.68%) and Russell 2000 (-2.99%)

• A relatively uneventful session – Magnificent 7 names all ticked higher, offset by weakness across defensive and yield-sensitive sectors

• Bullish focus points for the week – Macro data supporting soft-landing narrative as October PMIs surprised to the upside, third straight week of inflows to US equities, Q3 earnings surprising to the upside by almost 6% in aggregate, global easing cycle continued with 50 bp cut from Bank of Canada and dovish ECB commentary 

• Bearish focus points for the week – Bond yield backup continues to weigh on markets, IMF warned public debt levels to hit US$100tn this year, Apple cut iPhone orders by ~10m units for Q4 and 1H25 and China stimulus frenzy dies down

• Large investment funds forced to offload shares to avoid getting into trouble with US tax authorities (FT)

• Rush into US money-market funds has pushed the industry's total assets to a record US$6.51tn (BBG)

• Hedge funds sold China and EM shares in October, bought US stocks ahead of election (RT)

• India shaping up to be a destination for investors seeking shelter from financial volatility linked to US election (BBG)

STOCKS

• Microsoft to consider bitcoin investment in December (YH)

• Apple's iPhone sales in China down 0.3% while Huawei's surge 42% in Q3 (SCMP)

• Mercedes-Benz Q3 car earnings plunge by 64%, blames weak China, fierce competition for slump (RT)

CENTRAL BANKS

• RBA's Bullock says will take "another year or two" before inflation back within the 2-3% target (BBG)

• ECB officials urge caution on rate cuts despite market speculation (RT)

POLITICS & GEOPOLITICS

• Israel strikes Iranian targets late Friday night in retaliation for Iranian missile barrage (CNN)

• Iran says Israeli strikes caused 'limited damage'; no oil or nuclear sites targeted (RT)

ECONOMY

• China's top legislative body to meet in Beijing from 4-8 Nov, raising hopes of further stimulus (BBG)

• China's industrial profits plunged in September, recording the steepest monthly decline of the year (RT)

• US September durable goods orders down 0.8% MoM vs. consensus for 1.0% decline, core capital goods orders (ex-defence and aircraft) up 0.5% MoM vs. 0.1% consensus (RT)

• UK consumer confidence plummets ahead of Budget (FT)

ASX TODAY

• ANZ says 2H24 statutory and cash profits to be impacted by $196m after-tax charge in relation to Suncorp Bank acquisition (ANZ)

• BHP and Vale sign framework agreement (US$31.7bn) to be delivered to the people, communities and environment impacted by the 2015 Samarco dam failure (BHP)

• Cash Converters reports Q1 revenue of $95.8m (1Q24: $95m), net loss rate of 3.7% vs. quarter-ago 4.8% (CCV)

• Platinum Asset Management to have fielded competing proposals, Regal works through internal approvals to formally submit a revised bid (AFR)

• SiteMinder issues Q1 trading update at AGM, says adoption of transaction products continues to grow across incoming and existing customers, reaffirms organic revenue growth of 30% in the medium-term, expects to be underlying EBITDA profitable and free cash flow positive in FY25 (SDR)

• Temple & Webster reports YTD revenue up 21% YoY, average orders values back into growth, ~60% of orders now from repeat customers, reaffirms FY25 EBITDA margin guidance (TPW)

WHAT TO WATCH TODAY

• Gold – Gold equities continued to fall overnight despite bullion prices ticking 0.39% higher to US$2,746. The weakness was underpinned by Newmont’s underwhelming 1Q25 result, which dragged its NYSE-listed shares 14.7% lower on Thursday. AISC for the world's largest gold miner was US$1,611/oz for the quarter, 11.5% above analyst expectations of US$1,445/oz. This sparked a broad-based selloff among several major gold miners including Barrick Gold and Agnico Eagle Mines. This may not necessarily affect local names but something to be weary of.

• Yield sensitive sectors – Utilities, Financials, Staples and Real Estate were the worst performing US sectors. Bond yields have V-shaped their way back up to 3-month highs

BROKER MOVES

• Metcash downgraded to Hold; target cut to $3.40 from $4.10 (JEF)

• Metcash downgraded to Neutral from Outperform; target cut to $3.45 from $4.20 (MQG)

• Qantas Airways downgraded to Hold from Add; target up to $8.50 from $7.50 (MORG)

• Qantas Airways downgraded to Overweight from Buy; target up to $8.15 from $7.10 (JARD)

• Super Retail Group downgraded to Underweight from Market-weight; target cut to $12.90 from $16.10 (WILSONS)

• Wisetech Global upgraded to Buy from Neutral; target cut to $124.50 from $138 (CITI)

Stocks trading ex-dividend: 

• Mon 28 Oct: Alcoa Corp (AAI) – 0.17%

• Tue 29 Oct: Waterco (WAT) – 1.43% 

• Wed 30 Oct: Hotel Property Investments (HPI) – 1.81%, Acrow  (ACF) – 2.74%

• Thu 31 Oct: Imperial Pacific (IPC) – 4.83%, London City Equities (LCE) – 1.99%, Autosports (ASG) – 3.27%

• Fri 1 Nov: Pengana Global Private Credit Trust (PCX) – 0.58%

Other ASX corporate actions today: 

• Dividends paid: Centuria Industrial REIT (CIP), Centuria Office REIT (COF)

• Listing: Merino & Co (MNC) at 12:00 pm

• AGMs: ASX (ASX), Polynovo (PNV) 

Economic calendar (AEDT):

• No major economic announcements