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Markets at a glance 14 Novmeber

The S&P/ASX200 is on track to snap a three-day losing streak, as financials recover despite October unemployment figures missing the mark. Stock specific, shares of Xero (ASX: XRO) have surged to a record high on an earnings beat, while Graincorp (ASX: GNC) slips on a weak full year result. Globally, Asian equities are mixed as firm inflation keeps the US Fed on track for further rate cuts.

Leah Gibbons | nabtrade

Around the grounds

The Australian share market is on track to snap a three-day losing streak, following modest gains on Wall Street overnight after US inflation came relatively in line with expectations. Financials are leading the drive after a down day yesterday, while miners are mixed weighed down by a weak iron ore price. Energy is higher and Bitcoin hit a fresh all-time high overnight breaking briefly above the US$93,000 handle for the first time. 

Elsewhere, copper miners are under pressure, as prices hit a two-month low amid pressure from a strong US dollar after those key inflation figures state side, and weak demand prospects in top consumer China. 

On the data docket, October jobs numbers missed forecasts after a run of outsized gains, though the jobless rate held steady and underlying trends in the labour market remained resilient. Figures from the ABS showed net employment rose 15,900 in the month, with the jobless rate at 4.1%, holding there since June. The participation rate however edged lower to 67.1% from an all-time high of 67.2%. 

Staying on the economic outlook, Reserve Bank of Australia Governor Michele Bullock has continued to reiterate monetary policy will remain restrictive until policymakers are confident inflation is moving sustainably back to the target band. Markets are currently pricing in just a 10% chance the RBA will cut rates at the last meeting of the year on December 10, and just a 28% likelihood of a move as its following meeting in February.

Speaking at an event in Sydney the RBA Governor added policies planned by U.S. President-elect Donald Trump will not have an impact on inflation right now.

In the news

Quick check in on some of the stocks to watch in today’s trade. Rio Tinto (ASX: RIO) has approved the construction of a new solar plant at its Kennecott copper operation in Utah. The plant will reduce greenhouse gas emissions by around 6%, helping the company reach its target of reducing carbon emissions by 50% by 2030 and net zero by 2050.

Shares of Australian listed Xero (ASX: XRO) have surged to touch an all-time high after posting a 76% spike in half year net profit after tax, driven by a 25% surge in operating revenue during the period.

The stock is up nearly 51% this year, including today’s moves.

Shares of Flight Centre (ASX: FLT) have marched higher, as the corporate travel manager tips underlying profit before tax to come in between AU$365 million and AU$405 million for fiscal 2025, adding the guidance midpoint represents 20% growth on FY24. Shares of FLT are down 16% YTD.

Turning to the broker space and Aristocrat Leisure (ASX: ALL) is in focus as Citi says its upbeat after full year results came in ahead of consensus. Jefferies is also optimistic saying FY24 numbers reflected significant momentum in the U.S. land-based earnings and expects that to continue into the new fiscal year. Jefferies retains its ‘buy’ rating on the stock but raises its price target 16% to AU$77 a share.

ALL is up over 25% year to date, as of last close.

Finally, Australian listed shares of James Hardie (ASX: JHX) remain in focus after a better-than-expected annual profit sent shares soaring in yesterday’s trade. Morningstar has maintained its AU$51 fair value estimate on the stock, attributing its wide economic moat to strong brand reputation and cost advantages, despite short-term risks from cyclical housing markets.

Citi meantime is neutral, citing while the company’s results were better than expected, monetary policy uncertainties remain. The stock is down 5.6% as of last close, YTD.

Going global

Rounding things out on the global stage, Asian equities are mixed, as Japan’s Nikkei 225 erases earlier gains to trade in the red. Singapore stocks though are tracking higher, as investors shrug off tariff threats. On currency markets, the US dollar has briefly hit a one-year high against most major peers and scaled a three-and-a-half month high against the yen as markets see President-elect Donald Trump’s proposed policies leading to higher inflation, keeping the U.S.-Japan interest rate differential wide.

The euro edged lower to sit just above a one-year trough, while sterling lost 0.1%. The Australia dollar is flat trading around the 64.8 US cent mark hovering near the previous sessions’ three-month low after that marginally weaker jobs print.

 

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