Next Week At A Glance – 31 Mar – 4 April, 2025

This story features PRO MEDICUS LIMITED, and other companies. For more info SHARE ANALYSIS: PME

For a more comprehensive preview of next week’s events, please refer to “The Monday Report”, published each Monday morning. For all economic data release dates, ex-div dates and times and other relevant information, please refer to the FNArena Calendar.

The week that was in Australian Finance:

-It is hard to believe the Trump Administration has been in power for only two months. The “flood the zone” strategy is working a treat, with many market participants probably feeling fatigued by the will-he-won’t-he announcements. The President is definitely giving Dr Dolittle’s Pushmi-Pullyu a fictional animal with two heads (one at each end) that resembled a cross between a gazelle and a unicorn a run for its money when it comes to decisions.

-Against this backdrop of yes, you guessed it ongoing uncertainty, US markets have vacillated between technical trading and buying-the-dip, and selling tariff-impacted and technology stocks. For now, the AI trade is being buried under concerns around open-source models like DeepSeek and the potential overbuilding of infrastructure.

-No surprise that Australia’s Information Technology sector is down another -2% this week, and data centre companies are feeling a lot of selling pressure as are higher-valued growth stocks like Pro Medicus ((PME)), which is receiving a double whammy of a moderation in earnings growth expectations and multiple contraction.

-Analysts are daily sifting through the potential tariff impacts on earnings and how a US economic slowdown might affect Australian companies with US earnings, such as gaming stocks like Aristocrat Leisure ((ALL)).

-While M&A activity is pretty much moribund in the US, there has been more activity down under, with James Hardie Industries ((JHX)) launching an audacious takeover offer for a complementary building materials company, Azek.

-The February CPI print brought some relief on the inflation front, and the Australian interest rate market is pricing in -16bps of RBA rate cuts for May and a cumulative -62bps of cuts for 2025.

-The quote from Tony Sycamore at IG sums up this week well around the Australian market on Thursday:
“While US equity futures, the Japanese Yen, and the EUR/USD quickly recovered their early losses that followed the tariff news, the ASX200’s rebound was far more subdued. The most likely cause of this is concerns that the latest tariff developments represent another challenge to global trade and growth, which the Australian economy depends on. Additionally, reports surfaced yesterday that Prime Minister Anthony Albanese would announce a federal election today for May 3rd, introducing five weeks of political uncertainty a move that has since been confirmed this morning.”

-Lots more uncertainty ahead next week with end of the month and first quarter on Monday, and “Liberation Day”, April 2, on Tuesday with more tariff announcements.

Have a great weekend from the FNArena Team

Corporate news in the week that was:

-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.

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

-Meridian Energy ((MEZ)) is starting construction on a $227m, 139MW solar farm in August.

-Sovereign Metals ((SVM)) is raising $40m to fund the development of its Kasiya rutile-graphite project in Malawi, with the assistance of Rio Tinto ((RIO)).

-Helia Group ((HLI)) announced its lenders mortgage insurance agreement with CommBank ((CBA)) is at risk.

-Gold Road Resources ((GOR)) received and rejected a non-binding indicative offer from Gold Fields for $3.3bn.

-Ampol ((ALD)) has forecast repair costs from ex-Tropical Cyclone Alfred of -$35m.

-Glencore said it’s cutting planned coal production and will produce between 5 to 10m tonnes less coal than previously expected at its Cerrejn mine in Colombia.

-Stonepeak is in discussions to purchase Kinetic’s A&NZ bus operations, part of a $4bn sale process that is ongoing.

-Qantas Airways ((QAN)) to launch Project Sunrise, ultra long-haul flights in early 2027 with direct Sydney-London and Sydney-New York.

-Koala is preparing for an IPO roadshow to raise around $100m for a $500m valuation.

-Endeavour Group ((EDV)) executive chairman Ari Mervis is conducting a major review of Dan Murphy’s liquor stores and hundreds of pubs which may result in the break-up of the company.

-The Lottery Corporation ((TLC)) is considering a NZ lotto privatisation while retaining profits for charity.

-Bellevue Gold ((BGL)) halts trading with speculation of a guidance cut.

-Wisetech Global ((WTC)) is seeking assistance from Investment Banks for independent board members.

-Australian Super sells down Wisetech Global stake over governance concerns.

-Contact Energy ((CEN)) will appeal a decision blocking the development of its 300 megawatt onshore wind farm in Southland, New Zealand.

-TD Cowen said Microsoft walked away from new data centre projects in the US and Europe.

-Dollarama, a Toronto-listed discount retailer with a $41bn market capitalisation, wants to buy The Reject Shop for $6.68 a share, more than double the last close and 2 times its share price at the start of the year.

-Bellevue Gold ((BGL)) has requested a trading suspension as it mulls a potential downward adjustment to its production guidance.

-CoStar increased its bid for Domain Holdings ((DHG)) at a revised price of $2.8bn

-Nine Entertainment ((NEC)) experienced a data breach exposing personal data of 16k SMH, Age, and AFR subscribers.

Corporate Calendar

For a calendar of earnings result releases and a summary of earnings results to date, refer to FNArena’s Corporate Results Monitor (https://www.fnarena.com/index.php/reporting_season/)

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