The latest Market Talks covering Equities. Published exclusively on Dow Jones Newswires throughout the day.
2014 ET - Japanese stocks are lower in early trade on rising concerns over the Iran war and higher energy costs. Construction and retail stocks are leading the declines. Taisei is down 4.9% and Ryohin Keikaku is 2.4% lower. The dollar is at 153.49 yen, compared with Y153.15 as of Wednesday's Tokyo stock market close. Investors are closely watching developments in the Middle East and oil prices after Brent crude topped $100 a barrel for the first time since July. The Nikkei Stock Average is down 0.6% at 64759.80. (kosaku.narioka@wsj.com; @kosakunarioka)
2009 ET - U.S. steel spreads continue to strengthen for BlueScope Steel, says Jefferies. It says the spot spread for BlueScope's North Star steel plant is up 1% week-on-week at US$848/metric ton. The spread has gained 16% over the past three months, Jefferies says. BlueScope guided to a US$750/ton spread in 1H FY27, says the bank. That "suggests a strong lead into 2H27," given a roughly one-month lag on about 75% of its volume, says the bank. Shares are down 0.8% early in Sydney at 30.87 Australian dollars, alongside a broadbased decline in Australian equities. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)
1959 ET - Australian stocks are likely to fall in early trade, with ASX futures down by 1.0% ahead of Thursday's open. That follows losses on Wall Street, where U.S. stocks extended their recent decline as the war in the Middle East continued to escalate and drive up oil prices. The S&P/ASX 200 is already down 1.1% week to date, taking its month-to-date losses to 1.8%.(rhiannon.hoyle@wsj.com; @RhiannonHoyle)
1945 ET - Japanese stocks may fall as fears about the Iran war and higher energy costs grow. Nikkei futures are down 1.2% at 64355 on the SGX. The dollar is at 153.37 yen, compared with Y153.15 as of Wednesday's Tokyo stock market close. Investors are focusing on developments in the Middle East and oil prices after Brent crude topped $100 a barrel for the first time since July. The Nikkei Stock Average fell 0.2% to 65142.78 on Wednesday. (kosaku.narioka@wsj.com)
1903 ET - Westgold Resources' production outlook was broadly in line with expectations, but the gold miner's capex plans weren't. Ord Minnett analyst Paul Kaner says the capital required to reach an output target of 500,000 oz. of gold by FY29 was 40% higher than the market had forecast. "The increase reflects ongoing cost inflation and additional non-mill expansion capital requirements across the portfolio, with the composition of the 500,000 oz production profile having evolved significantly over the past year," Ord Minnett says. It downgrades Westgold to "accumulate," from "buy," and cuts its target price by 11%, to A$6.50/share. Westgold ended Wednesday at A$6.18. (david.winning@wsj.com; @dwinningWSJ)
1855 ET - Metcash gets a new bull in Macquarie after the retailer's trading update suggests it is performing well in a challenging environment. Macquarie was positively surprised by Metcash's food sales, which were up 2.6% in the first 18 weeks of FY27 when tobacco is excluded. That growth is likely driven by both volume and price. "Further, Liquor sales being +0.8% suggests modest market share gains against what we expect is a broadly flat market," Macquarie says. And while momentum in Metcash's Hardware business is likely to weaken, Macquarie thinks this is priced into its stock given the valuation discount to peers. It upgrades Metcash to "outperform," from "neutral," and keeps its price target unchanged at A$3.20/share. Metcash ended Wednesday at A$2.87. (david.winning@wsj.com; @dwinningWSJ)
1854 ET - AGL Energy's bear at Macquarie remains concerned about the power generator and retailer's FY28 outlook. Macquarie reckons consensus expectations for FY27 Ebitda of A$2.04 billion are materially too high. It points out the industry is 57% through the Default Market Offer period for pricing. Macquarie adds the El Nino weather event hasn't materially changed forward electricity markets, while batteries have reduced day-to-day volatility. "Power pricing is likely to stay below A$100/MWh (New South Wales) in FY28 and FY29," Macquarie says. The performance of AGL's power plants in July and August reflects the soft price environment with reduced coal generation, although this is likely reflected in FY27 Ebitda guidance, Macquarie says. It keeps an "underperform" call and A$7.94/share price target on AGL, which ended Wednesday at A$8.78. (david.winning@wsj.com; @dwinningWSJ)
1825 ET - Beacon Lighting's outlook is improving despite a volatile macro backdrop, says Ord Minnett. The retailer achieved 4Q same-store sales growth of 7.1% and signaled momentum has continued into FY27. "We believe accelerating sales momentum, a strong pipeline of new stores, a favorable FX swing for margins, and improving returns from its property fund underpins an improved outlook," says analyst James Casey. Ord Minnett expects Beacon Lighting's earnings to rise in FY27. It likes a strategy of increasing trade sales to around 50% of revenue. "That should enhance revenue diversification, reduce reliance on discretionary consumer spending, and support more resilient earnings growth across the cycle," Ord Minnett says. It retains a "buy" call and A$2.65/share price target on Beacon Lighting, which ended Wednesday at A$1.795. (david.winning@wsj.com; @dwinningWSJ)
1820 ET - Metcash's latest trading snapshot looks mixed to Jefferies. Sales were solid, up 2.8% in the first 18 weeks of FY27 when tobacco is excluded. Analyst Michael Simotas is pleased with the performance of Total Tools and Hardware, given a challenging housing market. Still, the headwind to profit margins in food was disappointing. "Food is rarely smooth sailing for Metcash," Jefferies says. "But we expect continued sales improvement from food inflation, Aldi's strategic pivot and reducing tobacco headwind." Jefferies retains a buy call on Metcash, noting it's doing better than its price-to-earnings multiple of 12x suggests. Its price target eases 2.9% to A$3.40/share, but stays above Metcash's closing price of A$2.87 on Wednesday. (david.winning@wsj.com; @dwinningWSJ)
1734 ET - Mexico's 2027 federal government budget proposal includes transfers of around $4.5 billion to Pemex for debt payments, which puts off plans for the state oil company to be financially self-sufficient by next year. "The lower budget support is an improvement over 2026, but doesn't break the financial link to the sovereign or show that Pemex can finance its operations, investment and financial obligations by itself," analysts at Banamex say in a note. The budget plan sees production of liquid hydrocarbons unchanged from 2026 at 1.8 million barrels a day, while crude oil exports are expected to fall to 426,600 b/d from 522,400 b/d this year. Mexico's average crude price is seen at $61.80 a barrel, down from an estimated $78.40 a barrel for 2026.(anthony.harrup@wsj.com)
1445 ET - U.S. Foods says its customers continue to be challenged but stable. "The K-shape continues to be unfortunately fully enforced," Chief Financial Officer Dirk Locascio says at Barclays' consumer staples conference. Restaurants that have struck the right chord with value propositions are doing well, Locascio says, while others have yet to find deals that resonate with customers. Restaurants with strong loyalty programs have also fared better, he says. (katherine.hamilton@wsj.com)
1423 ET - Apple officially launches the iPhone Duo, its long-awaited, foldable iPhone model. The device has a wide inner display, allowing the simultaneous use of multiple apps, and folds into a roughly passport-sized device with an outer screen. The model represents the company's largest change yet to its iconic line of mobile phones, and is the thinnest iPhone to date when unfolded, Apple says at its fall product showcase. The phone also features Apple's new mobile chip, the A20 Pro. "iPhone Duo brings an entirely new design while preserving everything you love and expect from the iPhone," Apple's new CEO, John Ternus, says. The phone's pricing begins at $1,999, with preorders beginning on Oct. 16.
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