Morning Wrap: ASX 200 to fall, S&P 500 dips on Mag-7 weakness, Healius to yield ~31% on Lumus sale

ASX 200 futures are down 37pts (-0.46%) as of 8:30 am AEDT.

In a nutshell:

• Major US benchmarks pulled back overnight, led by a sharp drop in heavyweight tech stocks like Nvidia (-5.7%) and Tesla (-5.5%)

• Trump tariff jitters weighed on sentiment, with expectations of auto and copper tariffs to be released in the coming days/weeks

• Healius plans to pay 41.3 cents per share special dividend (approx 31% yield), The Reject Shop to be acquired at a 112% premium

Let's dive in.

S&P 500 SESSION CHART

Note: This is the S&P 500 daily chart (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks finished broadly lower, slightly off worst levels

• Equal-weight S&P 500 outperformed the official benchmark by 90 bps as sectors like Staples, Utilities, Real Estate and Resources finished higher

• A relatively heavy session weighed by trade concerns, including expectations of Trump to announce auto tariffs today

• Barclays slashes S&P 500 target from 6,600 to 5,900 as their base case assumes earnings take a hit from tariffs (CNBC)

• UBS warned the S&P 500 could fall a further 8% to 5,300 on weakening employment expectations, consumer spending and consumer confidence (BBG)

• HSBC downgrades rating of US stocks from overweight to neutral amid growing uncertainty (BI)

• Morgan Stanley raises its Hang Seng Index and HSCEI year-end targets, citing improved earnings outlook (BBG)

• Short interest on the Nasdaq jumped to ~2.2% in mid-March (Reuters)

• BofA raises gold forecast for 2025 from US$2,750 to US$3,063 (YH)

STOCKS

• Nvidia shares dip 5.7% on potential US$17bn per annum hit if China enforces stricter energy efficiency rules on advanced chips (FT )

• Microsoft cancels more new data center projects in the US and Europe due to oversupply of computer clusters for AI (BBG)

• OpenAI expects revenue to more than triple this year to $12.7bn and forecasts $30bn by 2026 (BBG)

• US investment banks are poised to cut more jobs if economic uncertainty continues to weigh on dealmaking (RT)

• BYD aims to sell over 800,000 cars globally by 2025, planning to assemble vehicles locally to mitigate tariffs (RT)

CENTRAL BANKS

• BOJ to keep on raising interest rates if economy stays on track (RT)

TARIFFS & GEOPOLITICS

• US could impose copper tariffs within weeks, which is months ahead of schedule (BBG)

• EU preparing for a massive round of tariffs from US as soon as next week and considering retaliatory options (BBG)

• US tariffs could cut size of UK economy by approximately 1% (RT)

• Trump doesn't want "too many" exceptions in tariff review (BBG)

• Canada freezes rebate payments to Tesla, bans future rebate programs due to tariffs (RT)

• Washington adds dozens of Chinese entities to export blacklist (FT)

• India considers tariff cuts on more than half of US imports to shield export base (RT)

ECONOMY

• US February durable goods orders jump 0.9% month-on-month vs. expectations of a 1.0% decline as customers front-load purchases ahead of Trump tariffs (RT)

• UK inflation cooled to 2.8% in February, below market expectations of 3.0%, strengthening the case for another rate cut (BBG)

• Australia underlying inflation fell to its lowest level in more than three years, down to 2.4% in February vs. 2.5% ests, however expected to increase as electricity subsidies expire (AFR)

ASX TODAY

• AustralianSuper offloads entire ~$580m stake in Wisetech Global due to governance issues (AFR)

• Block to lay off 931 employees or ~8% of its workforce, CEO Dorsey attributes cuts to shifting strategic priorities and higher bar on performance, denies they were driven by financial factors (XYZ)

• COG Financial Services sees ~28m share block sold by holders NAOS Asset Management and director Cameron McCullagh’s GEGM Investments (COG) 

• Cuscal says on track to meet or modestly exceed FY25 proforma NPAT forecast of $36.6m (CCL)

• Gold Road Resources investors urging board to accept Gold Fields $3.3bn takeover bid (The Aus)

• Healius issues trading update, with YTD (to Feb-25) revenues up 6.2% year-on-year, plans to pay a special dividend of 41.3 cents per share and guiding to $36m capex for FY25 vs. $43.4m consensus (HLS)

• Lottery Corp could be eyeing an expansion into New Zealand (The Aus)

• The Reject Shop to be acquired by Dollarama for $6.68 cash per share or a 112% premium to Wednesday's close (TRS)

WHAT TO WATCH TODAY

• Where are we now: The S&P 500 is experiencing a classic pullback. Earlier this week, it reclaimed the 200-day moving average, only to retreat sharply overnight, settling just above this key threshold. The index and the broader market's behavior around these levels will be telling. While recent strength has shown some resilience — we’re not completely out of the woods. As tariff-related headlines continue to unfold, let's see how the market holds up.

• Sectors to watch: Most of our overnight ETF watchlist is red, led Copper Miners (-2.8%), Semis (-2.8%) and Uranium (-2.3%). Tech-related ETFs were also heavy, with Fintech and Cloud both down around 1.8%. Local data centre stocks may face further downward pressure amid oversupply and bubble talks from Microsoft and Alibaba. It will be interesting to see defensive sectors like Staples, Utilities and Real Estate can hold up in today's session.

BROKER MOVES

• Evolution Mining upgraded to Outperform from Hold; target up to $7.45 from $5.90 (CLSA)

• Paladin Energy downgraded to Hold from Buy; target cut to $5.50 from $8.50 (JEF)

• Pinnacle Investment Management upgraded to Overweight from Neutral but target cut to $22.60 from $24.20 (JARD)

Stocks trading ex-dividend: 

• Thu 27 Mar: Australian Clinical Labs (ACL) – $0.035, Eagers Automotive (APE) – $0.50, Ipd Group (IPG) – $0.064, Maas Group (MGH) – $0.035, Salter Brothers Emerging Companies (SB2) – $0.02, Wiseway Group (WWG) – $0.004

• Fri 28 Mar: Bravura Solutions (BVS) – $0.105, Centuria Industrial REIT (CIP) – $0.041, Centuria Office REIT (COF) – $0.025, Charter Hall Long Wale REIT (CLW) – $0.063, Comms Group (CCG) – $0.001, Dexus Convenience Retail REIT (DXC) – $0.051, Dexus Industria REIT (DXI) – $0.041, Garda Property Group (GDF) – $0.018, Rural Funds Group (RFF) – $0.029

Other ASX corporate actions today: 

• Dividends paid: AGL Energy (AGL), Ariadne Australia (ARA), BHP Group (BHP), Briscoe Group (BGP), Coles Group (COL), Downer EDI (DOW), EQT Holdings (EQT), Fortescue (FMG), GQG Partners (GQG), Gtn (GTN), Hansen Technologies (HSN), IDP Education (IEL), Ingenia Communities Group (INA), Kip McGrath Education Centres (KME), LGI (LGI), Mastermyne Group (MYE), Motorcycle Holdings (MTO), Netwealth Group (NWL), Newmont (NEM), Northern Star Resources (NST), oOh!media (OML), Ramsay Health Care (RHC), Steadfast Group (SDF), Summerset Group (SNZ), The Lottery Corp (TLC), Vulcan Steel (VSL)

• Listing: None

• Earnings: None

• AGMs: None

Economic calendar (AEDT):

No major economic announcements.