Good Evening,

Welcome to Equity Espresso’s Daily Recap. It was a quieter day to end the week, with Wall Street markets closed on Thursday. AustralianSuper responded to the latest takeover offer for Origin Energy, while Wiestech shares finished lower after the company’s AGM. Let’s jump in.

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The Recap

The ASX 200 index finished the day 11.6 points higher but ended the week 5.6 points lower to 7,040.8 in a week that started positively but failed to follow Wall Street’s positive week. Seven sectors finished the day higher, with Utilities (+1.6%) and Energy (+1.3%) leading the way. Origin Energy (+2.52%) rose after yesterday’s revised takeover offer from Brookfield.

WTI crude oil futures were steady on Friday at US$76.00/bbl ahead of next week’s OPEC+ meeting. Woodside (+1.4%), Santos (+1.4%) and Ampol (+0.7%) all ended the day higher.

Origin Energy’s largest shareholder, AustralianSuper, said it would vote against a Brookfield-led consortium's revised $19.1 billion offer. “This latest low-ball offer strengthens AustralianSuper’s view that the offer remains substantially below our estimate of Origin’s long-term value,” the company said in a statement. AustralianSuper confirmed it now owned more than 17% of Origin.

The Tech (-3.2%) sector was the biggest mover downwards. Wisetech (-3.2%) shares fell after it said EBITDA margins would be lower in the coming years as the logistics software company integrates its recent acquisitions.

Economic Data

• Japan’s Annual Inflation rate hit a three-month high in October of 3.3%, up from 3.0% in September. Prices accelerated for furniture & household utensils and culture & recreation.

• The Jibun Bank Japan Manufacturing PMI declined to 48.1 in November from 48.7 in October, the sixth straight month of contraction in factory activity.

• New Zealand Retail Sales remained stable quarter-on-quarter in the September quarter, following a 0.9% decline in the previous quarter. Thirteen of the fifteen retail industries had lower sales volumes.

Fear and Greed Index

Outlook

U.S. equity markets will reopen for business on Friday but close earlier at 1:00 pm, so it’s expected to be a quieter trading day. Futures markets are trading slightly higher this afternoon, with the NASDAQ (+0.06%) marginally above the S&P 500 (+0.05%).

The U.S. Global Services and Manufacturing PMI data for November will be reported overnight.

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Quick Singles

🪃 Local News

• The National Retail Association predicts that the Black Friday and Cyber Monday sales event will generate around $6.3 billion in sales over the next four days. Retailers are ramping up their discount offers in the lead-up to the events to make for an underwhelming year of sales.

• Australian banks will now prevent customers from transferring money if the sender's name does not match the recipient's details as part of a crackdown on scams. The move is seen as an offensive in the war on scams, which the ACCC revealed costs Australians over $3.0 billion annually.

🌏 Around The Globe

• Regulators in China are considering a new package of measures to support the real estate industry and boost growth. One of these measures involves offering banks unsecured short-term loans to qualified property developers. These loans, known as working capital loans, aim to ease the property crisis currently affecting the industry.

• There have been tumours that OpenAI researchers wrote a letter to the board of directors warning that a powerful artificial intelligence discovery could threaten humanity days before Sam Altman's ousting. The letter is rumoured to have been a key development that contributed to the decision.

• A new study has found that virtual meetings are more tiring than face-to-face conversations, leading to "Zoom fatigue" in remote work and online learning.

• Nono Nordisk will invest $2.3 billion to boost the production of its weight loss drugs Ozempic and Wegovy at a site in France as it tries to stay ahead of surging demand.

• According to media reports, Barclays is working on plans to save as much as £1 billion, which could involve cutting as many as 2,000 jobs, mainly in the British bank's back office.

• Swiss-based mining giant Glencore will build a pilot for an electric vehicle (E.V.) battery recycling plant outside of Italy after original plans to build the plant in Sardinia, Italy, were scrapped.

• German Pharmaceutical Bayer is copping the eerie of its bond investors after the company claimed it didn’t know the results of its blood-thinner drug trial before selling $5.75 billion of bonds to investors. Bayer stock was halted this week due to a lack of efficacy in the trial and is now down nearly 20% after recommencing trading.

Markets

ASX Company Movers

Commodity Prices

Bond Prices

ETF Watch

ASX News

🗞️ Company Announcements

• Adairs (ADH) provided a trading update for the first 21 weeks of trade in FY24, with total group sales down 9.0% so far for the year, with the company saying cost of living pressures and a decline in traffic have impacted each of its business segments.

• Bubs Australia’s (BUB) share price fell by 18% after the company completed its $14 million institutional placement at $0.125 per share. The company said that U.S. sales during Q1 of FY24 were up 24% to $11.6 million.

• Fletcher Building (FBU) announced that Bruce McEwen, chief executive of the company’s distribution unit, has resigned and will leave at the end of March 2024.

• Select Harvests (SHV) reported a full-year NPAT loss of $114.7 million during FY23, as the third year of La Nina weather patterns impacted crop volumes, which were down 30.2% YoY to 19,771 Mt. The cooler and wetter conditions led to Australian almond orchards producing volumes well below previous industry averages. The company cut its dividend and said costs would be flat to FY23 in the coming year.

• Star Entertainment Group (SGR) has gained an extension to operate in Queensland, with the 90-day licence suspension for the Star Gold Coast and Treasury Brisbane casinos pushed back to May 2024 from December 2023.

• Virgin Money UK (VUK) shares fell by 6% after it said full-year profit was down 42% to £345 million after it took a hefty and conservative £309 million provisioning charge against potential but not yet apparent bad debts.

• WiseTech (WTC) chairman Andrew Harrison will retire in March 2024 and be replaced by non-executive director Richard Dammery. Shares fell today as the company reiterated that EBITDA margins will be slightly lower in the coming year as the company’s recent acquisitions are integrated, but did say margins will return above 50% in FY26.

Social Media

 📱 Post of The Day

 Walmart’s roster is nothing short of an army, employing approximately 1.6 million “associates” in the U.S.

In its most recent fiscal year, Walmart sold $606 billion worth of stuff, a number so significant it’s almost meaningless on its own. $606 billion is more than most countries' annual output. Not some countries, but most countries. Indeed, were it a sovereign nation, Walmart’s revenue would be enough to rank around 27th in the world, more than the GDP of Sweden, Singapore, New Zealand and Norway.

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Broker Research

SenSen Networks

Code: SNS | Market Cap: $28m  | Current Price: $0.04
Price Target: N/A | Sector: Technology | Broker: Edison

Overview

SenSen Networks Limited develops and sells SenDISA platform-based products and services in Australia overseas. The company operates through its Smart Cities, Casinos, and Retail segments.

The SenDISA platform combines enterprise video, sensor data analytics and edge-to-cloud servers, meaning customers can automate their business processes and make fast and accurate decisions.

Highlights

• SenSen has won a significant contract with Australia's National Heavy Vehicle.

  Regulator (NHVR), generating A$1.5m in upfront revenue and approximately $500,000 in annual recurring revenue.

• The broker views the deal as validating SenSen’s technology and its land and expansion strategy.

• The contract follows from the 2021 trial, expanding from five to 32 cameras deployed across New South Wales, South Australia, Tasmania and Victoria, with the potential to expand the footprint across all NHVR jurisdictions.

You can access the full broker report here.

Recommendation

Friday Book Recommendation

A recent release about the history of money and economic impacts

Daily Quiz

❓️ Test Your Knowledge

Yesterdays Question. Why is turkey on Thanksgiving an American tradition?

Answer: Turkeys were abundant in the region where the Pilgrims settled (25%). By the turn of the 19th century, Turkey had become a popular dish to serve on occasions like Thanksgiving. The bird was abundant; one expert estimated that there were at least 10 million turkeys in America at the time of European contact.

A Little Extra

📉 Going Down?

Top-10 shorted stocks on the ASX - as of November 20

📊 Broker Ratings

What do the brokers have to say?

1. Boss Energy (BOE) - Upgrade to Buy from Hold (Bell Potter)

2. City Chic Collective (CCX) - Upgrade to Buy - High Risk from Neutral (Citi)

3. Nick Scali (NCK) - Downgrade to Neutral from Buy (Citi)

👨‍💼 Director Transactions

What are the insiders doing? (On-market trade only)

Social Channels

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DISCLAIMER: None of the information provided in this newsletter should be constituted as financial advice. This newsletter is strictly for educational purposes only. It should not be taken as investment advice or a solicitation to buy or sell assets or make financial decisions. Please do your research.