Morning Wrap: ASX 200 to tumble, S&P 500 snaps 5-day win streak + CBA, James Hardie results

Major US benchmarks finished lower as rising bond yields start to become a cause for concern as well as fading post-election momentum, China and European economies face growing challenges, commodity prices and resource stocks continued to slump overnight and James Hardie reports a solid Q2 result but disappointing full-year guidance.

Let's dive in.

S&P 500 SESSION CHART

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

OVERNIGHT MARKETS

• Major US benchmarks finished lower but off worst levels

• Equal-weight S&P 500 underperformed the official benchmark by 47 bps

• Post-election momentum starting to fade, with popular Trump trades starting to lag

• Bond yield backup getting some attention, with the US 10-year up 5 bps overnight to highest level since 31-Jul and up 80 bps since late September

• BofA’s largest Global Fund Manager Survey – Overweight US stocks jumped to highest since 14-Aug, global inflation expectations surged and turned positive for the first time since 22-Aug, higher inflation returned as the top tail risk (replacing geopolitical conflict), long Magnificent 7 remained the most crowded trade and investors said the most bullish 2025 development is tax cuts

• Long positioning on US stocks is above the 98th percentile across the S&P, Nasdaq and Russell, reflecting an extremely bullish outlook but could increase near-term profit taking risks, says Citi (BBG)

• China equity ETFs experienced more outflows amid Trump election win, stimulus disappointment (BBG)

STOCKS

• Home Depot shares ease 1.3pc after reporting smaller-than-expected fall in comparable sales, revenue and EPS beat consensus, transaction and ticket g growth stayed negative (RT)

• Boeing delivered just 14 jets in October, fewest deliveries in four years as strikes take toll (BBG)

• Activist investor ValueAct has $1 billion stake in Meta, according to sources (CNBC)

• Amazon steps up effort to build AI chips in a bid to rival Nvidia (FT)

• Tencent, Alibaba earnings to shed some light on health of China consumer demand (BBG)

POLITICS & GEOPOLITICS

• Trump's foreign policy picks show heightening support for Israel and boxing in Iran once he takes office (BBG)

• German's Scholz gains party support despite coalition collapse (FT)

• Europe's economies could be at risk from Trump's policies (NYT)

ECONOMY

• China may embrace greater stimulus, bolster manufacturing and allow the yuan to weaken to counter Trump policies (BBG)

• German economic sentiment worsens in November following collapse of three-party government and US election (BBG)

• UK wages exceed expectations, slowing only marginally to 4.8% in the three months through September (BBG)

• Australia November consumer confidence soars close to the 100 neutral level while business confidence jumps to highest level since early 2023 (BBG)

ASX TODAY

• CBA first-quarter FY25 trading update notes flat year-on-year cash NPAT of $2.5bn, operating income up 3.5% (up 2% on a day-weighted basis) (CBA)

• James Hardie reports Q2 adjusted net income of $157m vs. $147.4m (6.5% beat) but FY25 guidance disappoints, with net income of at least $635m vs. prior guidance $630-700m and North American EBIT margin of at least 29.3% vs. prior 29-31% (JHX)

• MinRes admits non-compliance of relation-party disclosure rules in reply to ASX (MIN)

• Retail Food Group 179m-share block trade crosses at 7.3 cents a piece, representing 7.2% of the company (RFG)

WHAT TO WATCH TODAY

• More China-related weakness – China stimulus disappointment continues to weigh on the resource sector, with most of our China-linked resource ETFs lower overnight, led by Copper (-3.1%). Tuesday's lithium bounce will likely hit a wall after lithium-related equities pulled back overnight. Iron ore stocks are also set to open lower as US-listed BHP and Rio Tinto shares finished the overnight session down 1.7% and 2.2% respectively.

BROKER MOVES

• FleetPartners upgraded to Outperform from Hold with $3.55 target (CLSA)

• NIB downgraded to Underperform from Neutral; target cut to $5.45 from $6.30 (MQG)

• NIB downgraded to Hold from Buy; target cut to $6.60 from $7.10 (JEF)

Stocks trading ex-dividend: 

• Wed 13 Nov: ANZ Group (ANZ) – 2.55%

• Thu 14 Nov: Dicker Data (DDR) – 1.21%, Plato Income Maximiser (PL8) – 0.44%

• Fri 15 Nov: None

• Mon 18 Nov: Rand Mining (RND) – 4.76%, Tamawood (TWD) – 3.06%, Tribune Resources (TBR) – 4.10%, Wam Leaders (WLE) – 3.38%

• Tue 19 Nov: None

• Wed 20 Nov: Amcor (AMC) – 1.22%, Wam Global (WGB) – 2.61%

Other ASX corporate actions today: 

• Dividends paid: Harvey Norman (HVN) 

• Listing: None

• Earnings: Life360 (360), James Hardie (JHX)

• AGMs: Beach Energy (BPT), Contact Energy (CEN), Endeavour Group (EDV), Hotel Property Investments (HPI), Medibank (MPL), (Sims (SGM)

Economic calendar (AEDT):

•  11:30 pm: US Inflation (Oct)