Morning Wrap: ASX 200 to rise, Powell signals rate cuts + Pilbara Minerals, Bendigo Bank results

Major US benchmarks closed within an arms reach of all-time highs after Powell said the "time has come" to cut interest rates and brace yourself for over 100 earnings reports, including results from names like Endeavour, Pilbara Minerals and Bendigo Bank.

Let's dive in.

S&P 500 SESSION CHART

S&P 500 gapped up and finished near best levels (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks rallied on Friday, ending near best levels

• Every sector finished positive, reversing Thursday’s declines, where the S&P 500 suffered its largest pullback in more than two weeks

• S&P 500 less than 1% from all-time highs set on 16-Jul

• The big story – Powell said “the time has come for policy to adjust” and the market reacted positively to his perceived dovish tone

• US weekly recap – Russell +3.58%, S&P 500 +1.45%, Nasdaq +1.4%, Dow +1.27%

• Investors flock to money market funds ahead of anticipated Fed rate cut (Reuters)

• Oil prices slide toward weekly loss amid demand concerns and Gaza cease-fire efforts (Bloomberg)

• Yuan carry trade emerges as alternative amid Yen volatility (Bloomberg)

• Bullish gold bets by hedge funds have jumped to highest level in over four years amid Fed rate cut expectations (Bloomberg)

STOCKS

• Mediterranean restaurant chain Cava soars 19% on better-than-expected Q2 earnings and full-year guidance upgrade (CNBC)

• Zenas BioPharma files for US IPO, signalling biotech market rebound (Reuters)

• Bain capital revives Kioxia IPO plans, targeting US$500m listing (Bloomberg)

• Telegram CEO Durov arrested in France, faces up to 20 years in prison (Reuters)

CENTRAL BANKS

• Powell says “the time has come for policy to adjust” at Jackson Hole, remarked his confidence that inflation path towards 2% has grown (Reuters) 

• BoJ's Ueda maintains rate hike path despite market turmoil, urges caution (Bloomberg)

• ECB's Kazaks open to a September rate cut, citing inflation progress and economic concerns (Bloomberg)

POLITICS & GEOPOLITICS

• Gaza ceasefire negotiations stalled by disagreements over Israeli military presence and prisoner releases (Reuters)

• China mulls tariff hike on large-engine gas cars amid EU EV tariff dispute (Reuters)

ECONOMY

• Eurozone long-term inflation expectations hit two-year low (FT)

• New Zealand retail sales slump, signalling potential third recession (Bloomberg)

ASX TODAY

There are approximately 116 companies due to report earnings today. Keep an eye out for earnings as they come through via our ASX Announcements page.

• De Grey to receive $150m debt funding after NAIF approval (DEG)

• Orora shareholders believe a $2.70 bid is worth a second thought (AFR)

• Regional Express flocked with opportunistic investors, final offers due Sep (AFR)

WHAT TO WATCH TODAY

Lots of earnings today. Here are some consensus/analyst forecasts for the more notable reporters:

• Endeavour Group: The FY24 result should highlight themes including consumers trading, price increases and a resilient gaming performance. Goldman Sachs (6-May) is expecting revenue of $12.2bn, EBITDA of $1.67bn, net profit of $520.8m and a total dividend of 21 cents per share (73.8% payout ratio)

• Pilbara Minerals: The market has a pretty good idea of what PLS will report since the company released its June quarter and full-year production numbers last month. Consensus is looking for underlying NPAT of $334m and EBITDA of $573.7m.

• Bendigo Bank: The stock has been on a massive rally ever since its trading update on 17 May. Macquarie (23-May) is forecasting FY24 NIM of 1.88%, cash EPS of 88 cents and a total dividend of 62 cents per share. (NIM will be a key metric to watch).

From an overnight ETF perspective, uranium was the big overnight mover (Global X Uranium ETF up 6.8%) after the world's largest uranium producer – Kazatomprom – cut its 2025 production guidance due to project delays and sulphuric acid shortages. The company cut its target for next year by 17% to 25,000-26,500 tonnes of uranium. This should see local names gap up strongly as the market opens.

BROKER MOVES

• Accent upgraded to Outperform from Hold; target up to $2.25 from $2.10 (CLSA)

• Accent upgraded to Buy from Neutral; target remains $2.20 (UBS)

• Accent upgraded to Buy from Overweight; target up to $2.29 from $2.28 (Jarden)

• Centuria Capital upgraded to Outperform from Hold; target up to $1.83 from $1.62 (CLSA)

• Fisher & Paykel downgraded to Hold; target up to $34.50 from $28.60 (CLSA)

• Fortescue downgraded to Neutral from Buy; target cut to $19.40 from $21 (Citi)

• Inghams downgraded to Neutral from Buy; target cut to $3.20 from $5 (BofA)

• IPH downgraded to Hold from Outperform; target cut to $6.60 from $6.85 (CLSA)

• Jumbo Interactive upgraded to Overweight from Underweight; target cut to $14.70 from $15.20 (Jarden)

• Monash IVF Group downgraded to Hold from Accumulate; target cut to $1.25 from $1.50 (Ord Minnett)

• Objective Corp. downgraded to Hold from Add; target remains $14 (Morgans)

Stocks trading ex-dividend: 

• Mon 26 Aug: Aurizon (AZJ) – $0.07, Challenger (CGF) – $0.135, Netwealth (NWL) – $0.14, Ansell (ANN) – $0.328, Domino’s Pizza (DMP) – $0.504, Step One Clothing (STP) – $0.028, Hansen Technologies (HSN) – $0.05, Santos (STO) – $0.193, Shape Australia (SHA) – $0.09

• Tue 27 Aug: Coronado Global (CRN) – $0.005, AGL Energy (AGL) – $0.35, Contract Energy (CEN) – $0.206, AGL Energy (AGL) – $0.35, Deterra Royalties (DRR) – $0.144, Humm (HUM) – $0.013, HMC Capital (HMC) – $0.06, Redox (RDX) – $0.065, IPH (IPH) – $0.19, MA Financial (MAF) – $0.06, BSP Financial (BFL) – $0.146

• Wed 28 Aug: Fiducian Group (FID) – $0.211, Telstra (TLS) – $0.09, Treasury Wine (TWE) – $0.19, Bell Financial Group (BFG) – $0.04, Ooh!Media (OML) – $0.018, The Lottery Corp (TLC) – $0.105, Maxiparts (MXI) – $0.026, Mitchell Services (MSV) – $0.02

• Thu 29 Aug: REA Group (REA) – $1.02, Beach Energy (BPT) – $0.02, Evolution Mining (EVN) – $0.05, Ventia Services (VNT) – $0.09, Ebos Group (EBO) – $0.497, Bapcor (BAP) – $0.055, Corporate Travel (CTD) – $0.12, Insurance Australia (IAG) – $0.17 

• Fri 30 Aug: Orora (ORA) – $0.05, Hitech Group (HIT) – $0.05, Ampol (ALD) – $0.60, Carlton Investments (CIN) – $0.63, Big River (BRI) – $0.02 

Other ASX corporate actions today: 

• Dividends paid: Goodman Group (GMG) – $0.15

• Listing: None  

• Earnings: Aussie Broadband (ABB), Austal (ASB), Bendigo Bank (BEN), Botanix (BOT), Dalrymple Bay (DBI), Downer (DOW), Endeavour Group (EDV), EVT (EVT), Genplus (GNP), Gold Road (GOR), Infomedia (IFM), Kogan (KGN), Liberty Financial (LFG), Macquarie Technology Group (MAQ), Nanosonics (NAN), Nib Holdings (NHF), Paladin Energy (PDN), Pepper Money (PPM), Regis Healthcare (REG), Ramelius (RMS), Regal Partners (RPL), Resolute Mining (RSG), Siteminder (SDR), Supply Network (SNL), Tyro Payments (TYR), Viva Energy (VEA), West African Resources (WAF), WAM Capital (WAM), Weebit Nano (WBT)

• AGMs: None

Economic calendar (AEST):

• 10:30 pm: US Durable Goods Orders (Jul)