OUR QUEST IS NOT TO BE BULLISH OR BEARISH, BUT TO CORRECTLY ASSESS FUTURE TRENDS

Macquarie rates ANZ as Neutral

Macquarie remains Underweight Australian banks as the economic and housing outlook continues to deteriorate, with conditions expected to weaken into 2027.

The broker now forecasts national house prices will fall around -10% from their peak as further interest-rate increases pressure credit growth and loan quality.

While recent credit quality has remained broadly sound, rising mortgage arrears and watchlist loans point to higher upcoming bad debt expense, the broker explains.

Macquarie's FY27 earnings forecast sits -1%-4% below consensus due to stronger competition, slower lending growth and margin pressure.

ANZ Bank and National Australia Bank remain the broker's preferred exposures. ANZ is thought to have the most attractive card for ongoing customers, with NAB now the least attractive given rewards earn-rate and card fees.

Unchanged Neutral rating and $33.50 target for ANZ Bank.

UBS rates BHP as Neutral

UBS considers diesel sensitivity across miners noting BHP Group and Rio Tinto ((RIO)) are the least exposed with costs rising by US$0.15/t per US$10/bbl move in the diesel price.

Fortescue ((FMG)) is marginally higher at US$0.20/t and Mineral Resources ((MIN)) is more sensitive at around US$0.4/t due to greater road haulage intensity.

Whitehaven Coal ((WHC)) costs lift by nearly $1/t per US$10/bbl in diesel. The analyst points out the sensitivity impacts as a cost impost rather than a risk to production levels.

BHP Group is rated Neutral with a $59 target.

Morgan Stanley rates TLX as Overweight

Post earnings season update and Morgan Stanley notes Integral Diagnostics ((IDX)) and Telix Pharmaceuticals are the two stock preferences in the Healthcare segment, both offering the highest upside possibility to the analyst's target prices.

The next catalyst for Telix is progress updates on the pipeline.

Overweight and $23.90 target retained. Industry View: In-Line.