The latest Market Talks covering Equities. Published exclusively on Dow Jones Newswires throughout the day.
1833 ET - Banks have led the way on Australia's share market in recent weeks, and UBS looks at what is driving this outperformance. It speculates it is due to investors rotating out of trades related to artificial intelligence, as opposed to stellar updates on banks' profit outlooks. "Also outperforming have been real estate equities, where share prices have possibly begun to take a 'look through' view on feelings that trough valuations may have already been reached," UBS strategist Richard Schellbach says. In contrast, consumer sectors have underperformed after several retailers gave soft trading updates. (david.winning@wsj.com; @dwinningWSJ)
1829 ET - The recent recovery in ResMed's share price prompts Morgans analyst Derek Jellinek to moderate his bullishness. Lowering his recommendation to "accumulate" from "buy," Jellinek writes in a note that healthy U.S. device demand, mask innovation, productivity initiatives and strong capital returns represent sound underlying fundamentals for the breathing-tech supplier. However, he points out that its stronger-than-expected September quarter contained multiple one-off gains. Morgans raises its target price on ResMed's ASX-listed stock 1.3%, to 40.00 Australian dollars. Shares are down 2.5%, at A$32.62. (stuart.condie@wsj.com)
1823 ET - Westpac needs to significantly outperform Morgans's forecasts if it is to hit its fiscal 2029 targets. Analyst Nathan Lead keeps a trim rating on the stock, telling clients in a note that trading multiples remain stretched. Westpac wants its cost-to-income ratio below and return-on-tangible-equity above peer averages by fiscal 2029. Lead observes that Westpac was well off these targets at least midway through its most recent fiscal year. He thinks it probably needs to hold or cut costs, strong balance-sheet growth, and superior asset and funding mix. Target price rises 2.1%, to 32.32 Australian dollars. Shares are up 0.1%, at A$37.23. (stuart.condie@wsj.com)
1807 ET - Apple emphasized its privacy protections on new AI tools, as the company looks to differentiate itself from peers such as Meta and Google. Executives mentioned privacy at least a dozen times in Monday's earnings call, primarily while discussing Siri AI, its new AI-driven personal agent. Chief Executive John Ternus notes that the data Siri AI can access is protected, so not even Apple can access it. This is a contrast with some peers, who sell consumer data to third-parties and advertisers. "We just want to make sure that users are aware of what they're giving access to," Ternus says. "We want to make sure this is done in a way that protects security and privacy." (katherine.hamilton@wsj.com)
1802 ET - Apple Chief Executive John Ternus sees the personal data on the iPhone as one of the company's biggest opportunities when it comes to AI. "So much of your personal data is on your iPhone, whether it's your contacts, your communications, health data, financial data, all of that," Ternus says to analysts on a call. Siri AI is going to be able to access that data, with permission, and act as a personal assistant and AI agent, Ternus says. "We think that is a core differentiator that we're excited about." (katherine.hamilton@wsj.com)
1759 ET - Palantir Chief Technology Officer Shyam Sankar takes a shot at Anthropic ahead of the AI lab's initial public offering this month. On an earnings call, Sankar directs investors to a portion of Anthropic's IPO filing touting its work to improve AIG's underwriting processes using AI. "That entire workflow and the elegant application of AI software and humans runs in AIP and was implemented by Palantir and AIG," he says, referring to Palantir's Artificial Intelligence Platform. "We are the diffusion layer, not just of choice, but of necessity." Palantir is an outspoken critic of frontier AI labs and has positioned itself as an option for enterprises seeking more control over their AI stacks. (elias.schisgall@wsj.com)
1756 ET - Turaco Gold's step toward owning the Afema Gold Project outright gets a tick from Morgans. Turaco Gold has an option to buy JV partner Sodim's 20% interest in the project for US$79 million. It is funding the deal through an A$120 million placement. Analyst Flynn Tyson likes the deal's financial terms. "Our A$555 million valuation of the interest is 5x the price paid, while the price itself sits broadly in line with our A$122 million value for Sodim's 1.5% net smelter royalty conversion right," Morgans says. Consolidated ownership gives Turaco Gold full control over project financing and early works ahead of a final investment decision. Morgans retains a speculative buy call on Turaco Gold, and raises its price target 23% to A$1.45/share. Turaco Gold ended Monday at A$0.69. (david.winning@wsj.com; @dwinningWSJ)
1746 ET - Palantir CEO Alex Karp uses his quarterly shareholder letter to warn of the dangers of AI agents being deployed in enterprises without his company's technology. Without proper context, grounding, and safeguards, "the LLM agent is a virtually unlimited liability, possessing a nearly unbounded destructive potential and a blast radius that tends towards infinity," he writes. "There is simply no means of effectively and reliably connecting the language models to large enterprises without the operating model and capabilities we have pioneered." Increasingly, Karp adds, business leaders in the U.S. are waking up to this realization. (elias.schisgall@wsj.com)
1741 ET - Apple says higher memory costs are squeezing margins. The company expects operating expenses in the current fiscal first quarter to be $20.4 billion to $20.8 billion, which would be ahead of the $20.26 billion analysts are anticipating. The higher costs are mainly related to rising memory prices, as well as some expenses related to ramping Siri AI, Chief Financial Officer Kevan Parekh tells analysts on a call. During the fourth quarter, which just ended, higher memory costs put pressure on the gross margin for both the overall company and the products business. Both margins would have been narrower had it not been for tariff refunds, Parekh says. (katherine.hamilton@wsj.com)
1738 ET - Palantir CEO Alex Karp says businesses are increasingly being distinguished by their control over their internal AI stack, something that has come to be known as "Sovereign AI." "The Sovereign AI movement is imposing the most dramatic dichotomy between haves and have nots that I have witnessed in 30 years of business," Karp says. "Every institution--government and commercial--is rapidly being forced, voluntarily or not, into one of these two categories." The company has consistently argued that businesses are better off using Palantir to build proprietary software using open-weight AI models than relying on a third-party AI provider such as Anthropic or OpenAI. (elias.schisgall@wsj.com)
1716 ET - Australian stocks look set to rise ahead of the Reserve Bank's latest interest-rate decision, which is widely expected to be a fifth increase in 2026. ASX futures are up by almost 0.7% ahead of Tuesday's open after oil prices fell on renewed diplomatic efforts to end the conflict between the U.S. and Iran. In the U.S., the DJIA rose 0.4%, but the S&P 500 and Nasdaq Composite fell 0.5% and 1.1%, respectively. Australia's S&P/ASX 200 benchmark index is coming off a 0.6% slip, giving back some of the gains made in October's 1.4% monthly advance. With economists expecting the cash rate to hit an 18-year high of 4.85%, investors will likely focus on the tone of the central bank's commentary. (stuart.condie@wsj.com)
1650 ET - Westpac's FY26 result leaves it with a mixed setup for FY27, contends Jefferies. Some of the headwinds that buffeted Westpac's net interest margin in 4Q should lessen, analyst Andrew Lyons says. Still, he expects underlying margin pressure to persist as hedge benefits slow. That view leads Jefferies to cut its FY27-28 EPS forecasts by 1%-2%. "Asset quality remains sound and capital provides flexibility, but with UNITE entering its hardest delivery phase and the shares above our price target, we retain hold," says Jefferies. UNITE is Westpac's program to reduce the number of products on offer, simplify its processes, and consolidate technology. Westpac ended Monday at A$37.19.
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