ASX to rise as CBA, James Hardie earnings in view

Australian futures are pointing to an upbeat start to the trading day across the Tasman, with earnings from Commonwealth Bank of Australia, James Hardie and AGL Energy in view, although yesterday’s sudden exits by the chief executives of stock market operator ASX and biotech firm CSL will give investors plenty to mull over.

On this side of the Tasman, Statistics New Zealand has second-tier livestock and concrete data on the schedule, while The Australian newspaper’s rumour mill has local investment bank Jarden as a potential takeover target and Apax Partners shopping around online listings firm Trade Me.

Wall Street set a modestly positive tone for the Asian trading session, with the major indices nudging higher after softer-than-expected consumer spending figures reaffirmed bets that the Federal Reserve will keep supporting the world’s biggest economy with lower interest rates.

And stocks in Europe were muted with earnings in focus as UK-listed BP tumbled after the energy major suspended a share buyback to bolster its balance sheet, while France’s Kering rallied after the Gucci parent said it’s targeting growth in the coming year after a recovery in sales through the end of 2025.

Aussie, Aussie, Aussie

Australian futures are pointing to a 0.4% gain for the S&P/ASX 200 index when trading opens across the Tasman today in what’s set to be a busy session with CBA setting the tone for financial stocks and the health of the wider economy when it reports its first-half earnings. Building materials firm James Hardie is also in the earnings diary today, as is AGL Energy.

Antipodean investors will continue to digest the sudden exits of CSL chief executive Paul McKenzie and ASX boss Helen Lofthouse, both of which came late in the Tuesday trading session.

That follows a modestly positive day on Wall Street, with the Dow Jones Industrial Average up 0.5% in late trading, and continuing to outperform 0.1% increases on the S&P 500 and Nasdaq Composite.

Flat US consumer spending in December fell well short of expectations and reaffirming predictions the Federal Reserve will continue to cut its benchmark rate to support the world’s biggest economy. The kiwi dollar fell to 64.03 US cents at 7am in Auckland from 64.40 cents yesterday.

“Softer than expected US retail sales supported the case for Fed rate cuts which contributed to a decline in treasury yields and a stronger yen,” Bank of New Zealand senior interest rate strategist Stuart Ritson said in a note. “Extreme winter weather in January is likely to further dent spending, setting up a slowdown in consumption growth this quarter.”

US earnings were mixed as Spotify jumped 15% as the streaming audio platform added a record 38 million monthly users late last year, while Coca-Cola falling 1.5% after missing expectations with sales at the bottom end of forecasts and S&P Global sank 8.8% as its disappointing result came as investors had already cooled on data firms given the threat posed by artificial intelligence tools.

Wealth advisers were also on the red side of the ledger after financial software firm Altruist Corp launched an AI tool to create tax strategies, denting the likes of Charles Schwab Corp, LPL Financial and Stifel Financial.

But wait, there's more

Trading platform Robinhood is due to report after the bell.

Across the Atlantic, stock markets were generally subdued as BP led the UK’s FTSE 100 down 0.3% after the energy major said it’s suspending a share buyback programme to let it use excess cash to strengthen its balance sheet. Germany’s DAX 30 dipped 0.1%, while France’s CAC 40 nudged up 0.1%, with Kering rallying after the luxury goods firm said it is targeting a reversal in declining sales after seeing signs of recovery through the tailend of last year.

Local data today including Stats NZ’s livestock slaughtering figures and concrete use for the December quarter.

Meanwhile, The Australian newspaper’s Dataroom column reported trans-Tasman investment bank Jarden has been holding talks for a potential deal with a global firm, thought to be New York-based Evercore. The Australian Financial Review last year reported Jarden was seeking an international partner.

Separately, The Australian reported Trade Me is getting shopped around by Goldman Sachs, with an initial public offering seen as struggling to raise enough money to repay the online listings firm’s debt.

And junior miner Rua Gold is said to be eyeing up a listing on the NZX as it pushes to join the fast-track consenting process for gold project on the West Coast, according to a Newsroom report.

Reporting by Paul McBeth. Image from Marcus Reubenstein on Unsplash.