0435 GMT - Platinum Asset Management's improving underlying investment performance is continuing, which bodes well for a potential reversal of the current challenged fund flows, says Morningstar analyst Shaun Ler in a note. This is something that the market may be underestimating, he says. "Granted, any net inflows may be short-lived as Platinum's investment style has tended to deliver performance that is more patchy than consistent," Ler adds. Morningstar assumes Platinum will see some net inflows in FY 2024-2025, before reverting to net outflows thereafter. Due to fee compression, cost growth and a weaker ability to compound funds under management, Morningstar expects Platinum's future operating margins to be lower. Still, it reckons that Platinum's shares are undervalued. Platinum is up 4.4% at A$2.02. (alice.uribe@wsj.com)

0050 GMT - IAG's latest reinsurance renewal was tough, but this was largely expected, says Citi analyst Nigel Pittaway in a note. IAG's FY 2023 non-quota share reinsurance expense is 22% higher alongside an effective A$100 million increase in pre-QS first event retention, he notes. "While significant, this is slightly better than our expectations with IAG also renewing its QS arrangements with Munich Re and Swiss Re for 10% of its 12.5% whole of account program, six months before expiry," Citi says. This continues the trend of IAG needing to retain more risk, hold more capital and pay more for the reinsurance it can buy, Citi says but adds that rising interest rates and firmer pricing may offset this headwind.(alice.uribe@wsj.com)

0026 GMT - IAG's reinsurance renewal update looks modestly tougher on pricing and coverage than the market had expected, but bringing forward the quota share renewal likely adds certainty on capital, Morgan Stanley analysts say in a note. The investment bank notes that IAG is now guiding for a 20%-24% increase in non-quota share reinsurance costs for FY 2023 versus a 19% estimate from MS. "However, IAG's and Suncorp's price increases are also accelerating, so we view this outcome as broadly in line with our margin forecasts," says MS. (alice.uribe@wsj.com)

0022 GMT - Australian insurers IAG and Suncorp are likely to issue mixed results for 1H FY 2023 during the upcoming reporting season, Macquarie analysts say in a note. The investment bank says that upside risk for gross written premium growth should offset downside risk for perils and hazards allowances. Still, Macquarie reckons it may be too early to change FY 2023 margin guidance in the absence of further reserve strengthening. Neither insurer, Macquarie notes, has updated their margin guidance for FY 2023 in recent months. "We see downside risk to both perils allowances at the 1H FY 20223 result but at this point FY 2023 experience should be ok," says the investment bank. (alice.uribe@wsj.com)

2349 GMT - Macquarie is showing ongoing, strong retail banking share gains, which Jefferies analyst Brian Johnson says in a note likely reflects better servicing metrics and competitive deposit pricing. In an analysis of regulator data for November, Jefferies notes that ANZ had modest gains in home loans given its above-peer rate discounting, cashbacks and heavy marketing to capture back its lost housing loan share, but has seen continued household deposits loss. At the same time, the November data shows NAB's housing loan share has slipped, as did Westpac's, while CBA's increased, even as it lost household deposits.(alice.uribe@wsj.com)

2249 GMT - Morgan Stanley expects the outlook for Australian housing will remain challenging throughout 2023, after prices fell 6.9% in 2022 to represent the largest fall in a calendar year in at least six decades. Higher interest rates are likely to create tighter conditions for credit, with Morgan Stanley predicting a peak rate of 3.6% in March. Also, many households will switch from low fixed-rate loans to variable-rate mortgages. "In the past four house price corrections, the key factor that drove a trough in prices was the RBA pivoting to rate cuts--not something we are expecting this year and hence we continue to see a 20% peak-to-trough correction in house prices as likely," Morgan Stanley says. (david.winning@wsj.com; @dwinningWSJ)

2238 GMT - Australian regulator data for November reaffirms that so far there is a lack of interest rate induced borrower stress so far, outside of construction, with housing system credit growth remaining reasonable, Jefferies analyst Brian Johnson says in a note. Still, he notes that there may be some lag between the higher interest rates and the flow through to variable home loan rates, with the November data likely only reflecting August. "The prospect of even higher interest rates is even more problematic for house prices and system credit growth," Jefferies says. (alice.uribe@wsj.com)

2225 GMT - The effect of Australia's housing-sector slowdown has yet to rattle new car demand, Citi analyst Jack Dunn says. Home prices have now fallen 9% since April, as buyers respond to the rapid series of interest-rate rises. "While we don't believe order books at the end of December will show impacts from house prices as supply continues to constrain sales, we await commentary at the February results from dealers on signs of orders slowing," Citi says. It has buy calls on Autosports and Peter Warren Automotive, and rates Eagers Automotive at neutral. (david.winning@wsj.com; @dwinningWSJ)

2214 GMT - Citi worries about Domino's Pizza Enterprises' ability to hit targets for opening more stores. In a note, analyst Sam Teeger says Domino's appears to be 13 stores short for 1H, or 14% of expectations for the rollout. "Domino's needs to more than double its monthly rollout run-rate to meet the at least 8% FY 2023 rollout guidance," Citi says. "This slower rollout is supportive of our view that cost headwinds may be adversely impacting franchisee profitability and willingness to open new stores." Citi retains a neutral call on the stock. (david.winning@wsj.com; @dwinningWSJ)

2154 GMT - While most investors expect ANZ's proposed acquisition of Suncorp's bank unit will garner the required regulatory approvals, Jefferies analyst Brian Johnson says in a note, that the Australian Competition and Consumer Commission probing for further data is unexpected. As a result, he wonders what would happen if the deal was rejected. He reckons it may be possible that ANZ buy back stock, which Jefferies sees would be dilutive given the earlier capital raising, or the major Australian lender could look to make non-bank acquisitions. ANZ remains Jefferies least favored major bank, despite having underperformed over 2022. (alice.uribe@wsj.com)

2227 GMT - Jefferies cuts its price target on HT&E by 8.3% to A$1.65/share after lowering its expectations for revenue in FY22-FY24 by 2%. Radio revenues haven't fully recovered from the pandemic, and analyst John Campbell doesn't see this happening until FY24. "Overshadowing the Covid recovery story is a looming consumer recession," Jefferies says. "If this eventuates, the ad cycle will contract sharply." Still, the bank retains a buy call on the stock, describing an FY23 price-to-earnings multiple of 9 times as cheap. Also, HT&E won't have any net debt once it completes the sale of its stake in the Soprano business. HT&E ended yesterday at A$1.135. (david.winning@wsj.com; @dwinningWSJ)

(END) Dow Jones Newswires