WiseTech Bounce vs MinRes Bounce...Down

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Welcome to Equity Espresso’s Market Recap.

The Australian share market managed a small gain on Friday, with the S&P/ASX 200 Index rising 5 points to 8,211.3, despite an overall weekly decline of 0.9%. The modest increase was primarily driven by the Technology (+3.34%) sector as WiseTech’s (+12.71%) stock surged following Richard White's announcement he would be stepping down as CEO but remaining at the company as a consultant. Health Care (+0.53%) was the other notable mover, thanks to a lift in Resmed’s (+5.95%) share price following the release of its Q1 results; more on that below.

While six of eleven sectors traded positively, Consumer Staples (-1.18%) faced pressure as supermarket giants Woolworths (-1.63%) and Coles (-0.98%) fell, respectively. Metcash (-3.3%) shares also fell after it flagged weaker in its hardware unit.

Mineral Resources (-4.99%) stock continues to tumble, down almost 5% for the day, making it -14.25% for the week following allegations that founder and chief executive Chris Ellison ran a tax evasion scheme for over a decade. AustralianSuper sold around $48 million worth of shares earlier in the week following the scandal.

Company News

• ResMed (+5.92%) reported strong first-quarter fiscal 2025 results, with revenue climbing 11% to $1.2 billion, driven by increased demand for sleep devices and masks, plus growth in residential care software. The company's performance showed significant improvement, with gross margin expanding to 58.6% and net income surging 42% to $311 million as manufacturing efficiencies and higher selling prices boosted profitability.

• Metcash (-3.33%) reported group-wide sales growth of 6.3% in the first half of FY25, with food sales (excluding tobacco) jumping 18.5%. Hardware and liquor divisions showed modest growth at 2.8% and 2.1%, respectively. Despite challenging conditions in hardware retail and trade sectors, the company estimates underlying net profit after tax will reach $132-135 million, supported by strong food performance and recent acquisitions.

• Qantas (+1.52%) reported stable trading, with domestic unit revenue expected to rise 3-5% in the first half of FY25, while international revenue per seat fell 7-10%. The airline announced a $28 million staff thank-you payment and continues its $400 million share buyback.

Wall Street

The U.S. stock market had a mixed performance on Thursday, with the Nasdaq (+0.76%) and S&P 500 (+0.21%) posting gains while the Dow Jones (-0.33%) declined. The day's standout performer was Tesla, whose shares surged 21.9% and added approximately $140 billion to its market value. Tesla’s optimistic earnings report and 20-30% sales growth forecast for the coming year helped drive the Consumer Discretionary (+3.24%) sector higher.

Despite Tesla's remarkable performance, the overall market sentiment has remained cautious. Most S&P sectors finished in negative territory, with Materials dropping 1.42% due to Newmont's disappointing earnings. Treasury yields eased to 4.20% after reaching a three-month high of 4.26% the previous day.

German air taxi startup Lilium's shares plummeted 61% to $0.20 after it announced that its two main subsidiaries would file for insolvency, closing at a new 52-week low on Thursday.

S&P500 Sector Performance

Economic Data

• U.K. Consumer Confidence fell slightly to -21 in October 2024, from -20 in September, hitting the lowest level this year.

• U.S. Initial Jobless claims fell by 15,000 from the previous week to 227,000 during the period ending October 19th, the lowest since the start of the month.

• The U.S. S&P Global US Manufacturing PMI for October fell to 47.8 from a 15-month low of 47.3 in September, compared to forecasts of 47.5.

• U.S. New Home sales jumped 4.1% to a seasonally adjusted annual rate of 738,000 in September 2024, the highest level since May 2023, following a downwardly revised 709,000 in August

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🌎️ Around The Globe

• American Airlines was fined $50 million by the U.S. government for mishandling wheelchairs and inadequate disability assistance from 2019-2023, with half the penalty credited for compensations and improvements already made.

• Apple and Goldman Sachs were fined $89 million by the CFPB for mishandling Apple Card disputes and misleading customers about interest-free financing, with issues affecting hundreds of thousands of cardholders between browser limitations and unprocessed disputes.

• Apple is reducing Vision Pro production, potentially halting assembly next month, as existing parts for 500,000-600,000 headsets should meet demand. CEO Tim Cook acknowledged the $3,500 device as an "early-adopter product," with plans for a cheaper version by 2026.

• Boeing's 33,000 production workers rejected a 35% pay raise, continuing their strike as the company reported a $6 billion quarterly loss. New CEO Kelly Ortberg pledged cultural changes amid concerns about the 737 Max, while the unprofitable aerospace giant's stock fell 3%.

• The Federal Aviation Administration published final regulations for electric vertical takeoff and landing (eVTOL) vehicles, marking its first new aircraft category approval since helicopters in 1940. The rules establish pilot training requirements for these air taxis.

• Tesla has been testing a robotaxi service with safety drivers in the Bay Area, as Elon Musk announced plans to launch paid autonomous ride-hailing in California and Texas next year, pending regulatory approval.

Markets

ASX Company Movers

Commodity Prices

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Forex

Global Health Check

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