Morning Wrap: ASX 200 to rise, S&P 500 bounces + Pinnacle, Amcor earnings

ASX 200 futures are up 53pts (+0.63%) as of 8:30 am AEDT.

In a nutshell:

• US stocks pushed higher intraday to finish at best levels and almost breakeven for the week

• Gold hit another fresh all-time high amid a solid session for resource-related equities including copper, lithium and uranium

• Pinnacle Investment Management reported 1H25 earnings and crushed market expectations

Let's dive in.

S&P 500 SESSION CHART

S&P 500 higher, finished near best levels (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks higher, finished near best levels and almost breakeven for the week

• Equal-weight S&P 500 underperformed by 60 bps, reflecting strength across Mag-7 stocks including Alphabet (+2.5%), Tesla (+2.2%), Apple (+2.1%) and Amazon (+1.95%)

• Markets bounced after a two-day pullback driven by Trump tariff worries, recent deals with Mexico and Canada provided some reprieve

• Today's big story – China implemented retaliatory measures but most viewed them as tepid to prevent further escalation, Trump said he would speak to Xi "at the appropriate time"

• Emerging market stocks vulnerable to outflows from strong dollar (BBG)

• Asian tech stocks at risk of 20% drop says Morgan Stanley (BBG)

STOCKS

• Estee Lauder is considering cutting around 11% of workforce by fiscal 2026 amid restructuring (AP)

• GM's robotaxi shutdown to include around 1,000 job cuts (BBG)

• Palantir jumps most in a year as ‘untamed’ demand bolsters outlook, Q2 earnings and guidance top market expectations (BBG)

• NXP Semiconductors revenue guidance underwhelms amid tepid demand for industrial and automotive chips (BBG)

• UBS beats profit expectations, boosts buyback plans to $3bn (FT)

CENTRAL BANKS

• ECB's Villeroy says more rate cuts are likely as inflation heads toward 2% target (BBG)

• Fed's Daly sticks to cautious approach to rate cuts, says Fed can take its time (BBG)

• Atlanta Fed's Bostic says it will be a while before next rate cut (BBG)

• Chicago Fed's Goolsbee backs cautious stance on rate cuts amid upside inflation risk (BBG)

• Markets pricing in more BOC rate cuts this year amid trade-related economic headwinds (BBG)

TRADE WAR

• China announces retaliatory tariffs on US imports including 15% tariff on LNG and coal, 10% tariff on US oil and farm machinery, launches probe into Google (AX)

• Beijing retaliation against Trump tariffs may so far be limited in scope to prevent escalation (FT)

• Trump eyes phone call with China’s Xi, threatens to substantially increase tariffs over fentanyl (RT)

• EU hopes "early engagement" may prevent US tariffs (RT)

• Trump pauses tariffs on Canada and Mexico after calls with leaders of both countries (BBG)

• Trump's latest backdown from tariff threat highlighting role as negotiating leverage (BBG)

• Trump wants US access to Ukraine's rare earths in return for military and economic assistance (FT)

ECONOMY

• US December job openings decline to 7.6m vs. 7.92m consensus, the lowest since September and reflecting declines in business services, health care and finance (BBG) 

ASX TODAY

• Amcor reports Q2 revenue drop of 0.3% to $3.24bn, weighed by unfavourable impact of foreign exchange and pass-through of lower raw material costs (AMC)

• BWP reports 1H25 distributable income growth of 13% to $65.6m (BWP)

• Pinnacle Investment Management reports 1H25 NPAT up 150% to $75.7m and aggregate FUM up 41% to $155.4bn, management continue see no significant improvement in appetite for equities amongst institutional clients, instead flows dominated by fixed income, credit and other private market assets (PNI) 

• Xref reports 1H25 revenue growth of 10% to $10.9m, ARR to continue to increase as remaining clients move to new subscription agreements (XF1)

WHAT TO WATCH TODAY

• Amcor: Amcor result was largely in-line with estimates, free cash flow (both Q2 and guidance) ahead. Amcor shares rallied 5.1% on the NYSE, assuming the CDIs are 1:1, fair value should be around $16.07 for local AMC shares.

• Pinnacle: Absolutely crushed 1H25 earnings expectations, NPAT of $75.7m is 60.0% ahead of Macquarie ests (as at 29-Nov-24), interim dividend of 33 cps is a 47.5% beat of 17.3 cps ests, FUM and net flows beat ests by 5.9% and 35.8%. PNI shares are up 134% in the past year but the magnitude of the beat may add further fuel to the soaring share price.

• Copper, Uranium and Nickel: Solid gains for most of these overnight ETFs, reflecting better-than-feared China tariff response and a bounce from oversold levels.

BROKER MOVES

• Australian Finance Group upgraded to Buy from Neutral; target up to $1.85 from $1.65 (CITI)

• Bellevue Gold initiated Underweight with $1.00 target (JARD)

• Macquarie Technology initiated Hold with $81.70 target (JEF)

• Nufarm upgraded to Buy from Hold; target up to $4.35 from $4.25 (BP)

• Pepper Money upgraded to Buy from Neutral; target remains $1.55 (CITI)

Stocks trading ex-dividend: 

• Wed 5 Feb: None

• Thu 6 Feb: Midway (MWY) – 31.43%

• Fri 7 Feb: None

Other ASX corporate actions today: 

• Dividends paid: None

• Listing: None

• Earnings: Amcor (AMC), BWP Trust (BWP), Kelly Partners (KPG), Pinnacle Investment Management (PNI)

• AGMs: None

Economic calendar (AEDT):

No major economic announcements.