The Monday Report – 24 March 2025

This story features BANNERMAN ENERGY LIMITED, and other companies. For more info SHARE ANALYSIS: BMN

Tuesday night’s Budget tremours overshadow a positive lead from Wall Street on Friday. ASX200 futures are pointing to a decline of -0.5%.

Good Morning,

Another big week for markets with Australia’s February CPI on Wednesday and the US PCE indicator on Thursday

Extract from Tony Sycamore, IG

“The ASX200 finished 145 points (1.82%) higher last week at 7931. The rally was supported by the absence of new tariff headlines and after February’s labour force data reinforced expectations, ours included, of an RBA rate cut in May.

With six trading sessions remaining in March, the ASX200 needs to rally nearly 3% from Friday’s closing price to avoid a second consecutive month of losses and, more importantly, its second straight losing quarter.

At a stock level, Bannerman Energy ((BMN)) up 23.56%, Nanosonics ((NAN)) up 17.56%, Seven West Media ((SWM)) up 13.79%, and Deep Yellow ((DYL)) up 12.38% locked in double-digit gains for the week. The biggest losers last week included Appen ((APX)) down -10.40%, BetMakers Technology Group ((BET)) down -7.62%, James Hardie Industries ((JHX)) down -6.70%, and a2 Milk ((A2M)) falling -6.01%.

The key highlights on this week’s local economic calendar are Tuesday night’s Federal Budget, which isn’t expected to be a market mover, and Wednesday’s Monthly CPI Indicator for February.

In January (last month), the Monthly CPI indicator rose by 2.5% year-on-year, unchanged from the prior month but below expectations of 2.6%. Annual trimmed mean inflation rose 2.8% in January, up slightly from 2.7% in December. The expectation for February is for headline inflation to fall to 2.4% year-on-year from 2.5% prior, while the trimmed mean is expected to ease to 2.7% YoY from 2.8%.

The Australian interest rate market starts this week pricing in -18bps of RBA rate cuts for May, with a cumulative -65bps of RBA rate cuts priced for 2025, up from -59bps this time last week.

Overseas markets on Friday

Despite quarterly options expiration day on Friday in US markets and a negative start to the day, some good ol’ bottom fishing kicked in around lunchtime, post President Trump’s comments on the upcoming April 2 tariffs. He stated there would be some “flexibility” on tariffs; whatever that means!

Bloomberg reported over the weekend some countries/regions could be excluded from tariffs and there might be a more targeted approach.

The reality is the ability to price the tariff impact into assumed future economics and markets is incredibly challenging. Not just because there are a number of different tariff policies to consider: Reciprocal, matching VAT-levels, universal and country-level targeted tariffs (China, USMCA). 

We then need to understand the legalities and the possible implementation dates. We need to price whether the tariff rates kick in in full or in a staggered/phased approach, and the response from the receiving country is critical for the prospect that Trump increases, reduces or even delays the initial proposals. 

Pricing tariffs an incredible challenge, Chris Weston, Pepperstone

“After April 2 there will be a period of intense negotiation where the noise’ from the headlines will be deafening subsequently, this will only further impede and disrupt our ability to price risk and certainty. With market players having seen so many episodes in 2025 of tariffs being walked back, carved out or delayed, despite Trump et al substantially building up “Liberation Day” as a defining moment, many will question if this time will be any different.”

Canada Election

The Dow Jones Industrial Average rose, and the S&P 500 rose 0.1%, respectively, and the Nasdaq Composite lifted 0.5%. All closed at their best levels of the session, with late afternoon buying in the mega caps. Apple and Microsoft, at 13% index weighting of the S&P, were two of the best performers.

Still, many stocks registered declines following disappointing earnings and/or guidance from the likes of FedEx down -6.5%, Nike falling -5.5%, Lennar (home builders) down -4.0%, and Micron (semiconductor sector) falling -8.0%.

There was no top-tier US economic data on Friday.

European share markets declined on Friday, with travel stocks hit with profit taking as London’s Heathrow Airport was closed post a fire in a substation.

Weakness in metal prices pushed resource stocks lower. Brent crude rose USD 16 cents to US$72.16 a barrel, with a lift of 2.1% on the week the biggest gain since the first week of 2025.

Prime minister Carney has called the Canadian election for April 28, and the announcement on Sunday has come after a series of stimulatory measures aimed at ameliorating the impact of US tariffs.

Tuesday’s Australian Federal Budget will extend power bill relief until the end of 2025 for all households and around one million small businesses, at a cost of -$1.8bn to the budget bottom line. The Treasurer, Jim Chalmers, said President Trump’s policies around tariffs have “cast a shadow over this budget”.

Corporate news in Australia

-ASIC has targeted multiple credit funds to justify their governance and valuation methods by April 14, with the sector becoming more susceptible to rising defaults.

-Mineral Resources ((MIN)) has reopened its Onslow Iron haul road after a sixth truck crash forced the miner to close the haulage network early last week.

-CoStar’s Andy Florence has arrived in Sydney to discuss the Domain Holdings ((DHG)) bid with Nine Entertainment ((NEC)).

-South32 ((S32)) has been accused by an Australian engineering and logistics company of stealing secrets.

-James Hardie Industries ((JHX)) is merging with US outdoor living product manufacturer AZEK for US$8.8bn, which will see James Hardie shareholders own 74% and AZEK shareholders around 26% of the company group. Hardie will list on the NYSE.

-The Lottery Corp ((TLC)) chief executive, Sue van der Merwe, will retire by the end of this year

On the calendar today:

-Global PMIs

-LYCOPODIUM LIMITED ((LYL)) ex-div 10c (100%)

-NAOS EMERGING OPPORTUNITIES CO. LIMITED ((NCC)) ex-div 2c (100%)

-NEW HOPE CORPORATION LIMITED ((NHC)) ex-div 19c (100%)

-NRW HOLDINGS LIMITED ((NWH)) ex-div 7c (100%)

FNArena’s four-weekly calendar: https://fnarena.com/index.php/financial-news/calendar/

The Australian share market over the past thirty days

For more detail go to FNArena’s Australian Broker Call Report, which is updated each morning, Mon-Fri.

All overnight and intraday prices, average prices, currency conversions and charts for stock indices, currencies, commodities, bonds, VIX and more available on the FNArena website.  Click here. (Subscribers can access prices on the website.)

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