Morning Wrap: ASX 200 to rise, S&P 500 slips on AI competition fears, CBA tops earnings expectations

ASX 200 futures are up 38 pts (+0.43%) as of 8:30 am AEDT.

In a nutshell:

• Major US benchmarks mostly lower but breadth was positive as the Equal-weight S&P 500 (+0.36%) and Dow (+0.10%) both closed at a second straight all-time high

• Various drivers for this defensive session, spanning AI competition concerns, hawkish commentary from Fed policymakers and soft US retail data

• Busiest day for reporting season so far, with results from CBA, CSL, SGH and more

Let's dive in.

S&P 500 SESSION CHART

S&P 500 lower, closed near worst levels (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks mostly lower, finished near worst levels

• Breadth was positive, with the Equal-weight S&P 500 (+0.36%) closing at a second straight record high and outperforming the cap-weighted index by 69 bps

• A somewhat quiet session, where stock struggled to hold onto earlier gains amid a defensive tilt towards Utilities, Real Estate and Materials

• Various drivers for this defensive tilt, including insurance and financial advisory sectors hit by AI competition concerns, weaker-than-expected US retail sales data, Trump’s Iran comments and hawkish Fedspeak

• Bond yields broadly lower, with the US 2-year down 3 bps to 3.45%, closing just shy of a fresh 3.5 year low

• Equity trading volumes averaged over US$1tn a day in January, up 50% year-on-year (BBG)

• Wealth manager stocks hit by Altruist Corp's AI tool for creating tax strategies (BBG)

• Goldman Sachs CEO Solomon says software selloff has been 'too broad' (YF)

• Super Bowl trading volume surpassed $1bn on Kalshi, up 2,700% year-on-year (CNBC)

• Wall Street seeks cheaper global stocks as high valuations and weakening US dollar spur competition (WSJ)

STOCKS

• TSMC January sales surge, indicating strong global AI spending (BBG)

• Tesla is reportedly quoting US$290,000 for its 500-miles electric semi-truck, up from 2018 quote of $180,000 (ET)

• Microsoft mulls advanced power lines to drive energy efficiency at data centres (YF)

• Surge in memory chip prices widens stock market gap as memory producers thrive but Apple, Nintendo suppliers struggle (BBG)

• Cisco launches new chip and router to enhance data centre speed, targeting $600bn AI infrastructure market (RT)

• OpenAI kills ChatGPT-4o model due to real-world harm concerns (WSJ)

• SoftBank shares surge over 10% as telecom arm lifts profit outlook, boosting AI optimism (CNBC)

• Barclays plans to return £15bn to shareholders following profit increase, driven by investment banking strength (FT )

• BP shares slump after it suspends share buyback plan to focus on cutting debt (RT)

TARIFFS

• Trump administration may exempt Amazon, Google, Microsoft from upcoming chip tariffs tied to TSMC investments (FT)

• Trump threatens to block new Detroit-Canada bridge, escalating political tensions (POL)

• US and Japan top trade officials to discuss first $550bn investment project (BBG)

CENTRAL BANKS

• Governor Miran says Fed balance sheet needs shrinking to make room for crisis management (BBG)

• Cleveland's Hammack says Fed could hold for quite some time due to cautiously optimistic economic outlook (RT)

• Dallas Fed's Logan says current policy well positioned for both persistent inflation, cooling labor market (WSJ)

GEOPOLITICS

• US advises ships to stay clear of Iran's waters in Strait of Hormuz after boarding attempts (CNBC )

• Trump says he might send second carrier to strike Iran if talks fail (AX)

• UK PM Starmer refuses to resign over fallout from Epstein scandal as cabinet rallies around him (FT)

• Takaichi's historic victory in Japan poses dilemma for China's Xi amid recent rise in tensions (BBG)

ECONOMY

• US December retail sales flat month-on-month vs. consensus for a 0.4% increase, with eight out of 13 retail categories posting decreases (BBG)

• Australia's consumer sentiment declines in February following RBA's rate hike to combat inflation (BBG)

ASX TODAY

• ASX CEO Helen Lofthouse to step down in May (ASX)

• CBA 1H26 cash NPAT up 6% to $5.44bn vs. $5.20bn ests, interim dividend up 4% to 235 cps, reiterates 70-80% payout ratio (CBA)   

• Computershare 1H26 results mostly slight beats vs. consensus, full-year management EPS upgraded to $1.44 vs. prior $1.40 guidance (CPU)

• CSL CEO Paul McKenzie to retire, effective 10-Feb (announced 4:05 pm AEDT – which crashed the share price in the closing action from +1.5% to -4.9%), former senior executive Gordon Naylor appointed interim CEO (CSL)

• CSL 1H26 results broadly below consensus, NPATA down 6% to $1.95bn vs. $2.05bn ests, reaffirms full-year guidance, though management guide CSL Seqirus to trade lower in the second half and Vifor to remain adversely impacted by competition in iron products (CSL)

• SGH 1H26 results mostly in-line, reiterates full-year guidance of low-to-mid single-digit EBIT growth (SGH)

WHAT TO WATCH TODAY

• Massive day for corporate earnings, many of which are still flowing through. I'll be covering all (or as many as I humanly can) on the Live Blog

BROKER MOVES

• Computershare upgraded to Overweight from Neutral; target up to $36.50 from $35.50 (JPM)

Stocks trading ex-dividend: 

• Wed 11 Feb: ResMed (RMD) – $0.059

• Thu 12 Feb: Apiam Animal Health (AHX) – $0.10, Korvest (KOV) – $0.25, Scentre Group (SCG) – $0.089

• Fri 13 Feb: Plato Income Maximiser (PL8) – $0.006 

Other ASX corporate actions today:       

• Dividends paid: None

• Earnings: AGL Energy (AGL), Bravura Solutions (BVS), CSL (CSL), Evolution Mining (EVN), Kelly Partners Group Holdings (KPG), SGH (SGH)

• IPOs: None

• AGMs: None

Economic calendar (AEDT):

• 11:30 am: Australia Home Loans (Q4)

• 12:30 pm: China Inflation (JAN)

• 12:30 am: US Non Farm Payrolls (JAN)