0424 GMT - Australian insurers will be asked to show how prepared they are for more frequent flood events, as part of a new Australian government inquiry into how insurance companies responded to the 2022 floods. The inquiry, which was announced on Wednesday by Assistant Treasurer Stephen Jones, will also consider supply chain issues, skills, labor shortages, claims handling, and communication with policyholders before, during and after events. "Natural disasters continue to have a massive impact on the lives of Australians, especially those in rural and regional communities," Jones says. The 2022 floods in Southeast Queensland and NSW are the costliest natural disaster for insurance costs in Australian history, Jones adds.(alice.uribe@wsj.com)

0403 GMT - The pricing of Microsoft 365 Copilot points to monetization of AI that could be a positive for Australia-listed data-annotation company Appen, Jefferies analyst Wei Sim says. He says Microsoft's pricing of Copilot came sooner and at a higher price point than he had expected. He reckons Microsoft and Google could invest further in their large-language models to improve results and minimize the risk of false information, or so-called hallucination. However, he remains cautious about demand from Meta, where budget constraints could drive a 30%-40% on-year decline in annotation investment for the December half. Jefferies has a hold rating and A$2.60 target price on Appen's stock, which is up 2.0% at A$2.335. (stuart.condie@wsj.com)

0354 GMT - While Aussie banks have reduced mortgage cashback offers, fierce discounting is still playing out, UBS analyst John Storey says in a note, adding that lower interest-rate serviceability buffers are being used by some of the banks to win new refinancing business. On net interest margins, consensus is forecasting them to compress 12 basis points between FY 2022 and FY 2025, driven by an uptick in funding costs relative to increases in asset yields. But UBS reckons some NIM headwinds into 2H FY 2024 could turn out to be softer than forecast. Consensus has CBA as having the largest NIM decline (15bp), but UBS says its analysis shows it being well placed relative to peers. (alice.uribe@wsj.com)

0329 GMT - The market will likely be skeptical about Ansell's projection that the cost of its investment program will pay for itself by fiscal 2026, Citi analysts say in a note. The Australia-listed protective-garment manufacturer has flagged a A$40 million-A$50 million investment that it says will generate A$45 million in pretax cost savings by fiscal 2026. Yet the Citi analysts reckon that investors will be wary given that Ansell's EPS has been largely flat over 10 years. Citi cuts target price 8.3% to A$25.00 and stays neutral on the stock, which is down 2.1% at A$23.37. (stuart.condie@wsj.com)

0220 GMT - Northern Star Resources' FY 2024 production and cost estimates are disappointing, with light guidance across its mine sites, RBC Capital Markets analyst Alex Barkley says in a note. Barkley reckons the gold miner has taken a conservative approach to the year ahead as it grapples with the Thunderbox mill ramp-up and industrywide cost and labor uncertainties. The company's FY 2024 production guidance was roughly 7% below both RBC's and the market's expectations, he says. Its all-in sustaining cost projection was meantime 11% higher than RBC had expected and 10% above consensus. "However, we see this modest FY24 guidance as quite achievable for NST, whom we consider a relatively strong mine operator," Barkley says. "This should lower downside risk during FY24." Northern Star is down 7.3% at A$12.40/share. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)

0216 GMT - Hub24's FY 2024 funds under administration guidance range of A$80 billion-A$89 billion is looking increasingly stretched to UBS, analyst Scott Russell says in a note. He adds that Hub24 didn't make mention of that in its recent 4Q update, which shows that while net funds flows are below UBS's forecast, FUA is broadly in line with the investment bank's projections, as well as with consensus. UBS remains optimistic for future funds flow for Hub24, due to the large number of financial advisers onboarded during 4Q. It keeps a buy call on the stock, but cuts its target price 3.2% to A$29.50. Hub24 rises 1.6% to A$26.07. (alice.uribe@wsj.com)

0116 GMT - CBA is likely to deliver a satisfactory 2H result, but it will be any forward-looking commentary on margins, volume growth, costs and credit quality that will drive any share-price changes, say Morgan Stanley analysts in a note. MS forecasts margins to fall 7 bps on half in 2H, noting that the investment bank is below consensus and is more cautious on the FY 2024 outlook. Excluding remediation, MS forecasts 2Hpreprovision profit of A$7.86 billion (down -1% on half) and cash profit of A$5.15 billion (down around 2% on half). MS notes that its forecasts are +1% versus consensus. MS sees a dividend of A$2.53, which is above the previous peak of A$2.31 in 1H FY 2019. (alice.uribe@wsj.com)

0103 GMT - Rio Tinto's 2Q production result was mostly in line with RBC Capital Markets' expectations, although it was slightly disappointing versus consensus, says analyst Tyler Broda. "Nothing too material in the production numbers albeit we would expect some modest consensus downgrades into H1" earnings, he says in a note. Rio Tinto's remarks on FY iron-ore output, which the miner now expects in the top half of its guidance range, "suggests the company is now back on top of the Pilbara operations, which should allow investor confidence on the operational side to continue to improve," Broda says. However, iron-ore markets appear to have ample supply and a weak 2H for prices is expected, he adds. Rio Tinto is up 0.3% in Sydney at A$117.28/share. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)

0043 GMT - Latitude is cut to underweight from equal-weight by Morgan Stanley analysts, who see few positive catalysts on the horizon for the stock. The MS analysts expect earnings volatility and economic pressures to keep squeezing margins at the Australian credit-provider. Its capital levels remain strong, but slowing volume growth and rising bad debts worry the MS analysts, who also call out higher funding costs. They cut their earnings forecasts by 3% for fiscal 2023, 11% for fiscal 2024, and 8% for fiscal 2025. Target price falls 9.1% to A$1.00. Shares are up 0.4% at A$1.195. (stuart.condie@wsj.com)

0041 GMT - Macquarie is likely to provide a subdued 1Q FY 2024 AGM update, following a strong 1Q in the previous year, say Morgan Stanley analysts in a note. Macquarie has a difficult base of comparison as 1Q FY 2023 was a strong quarter what saw large principal investment sales, says MS. The investment bank thinks that several large asset sales so far in 1Q FY 2024 may not be enough to overcome soft commodity and capital markets plus slower mortgage growth, noting that it doesn't expect Macquarie to provide a 1H outlook at its AGM. Still, MS reckons that Macquarie is well placed to deliver upgrades as FY 2024 progresses, with key swing factors being performance fees, gains on sale, and commodities, where the Australian financial company may benefit from volatility. (alice.uribe@wsj.com)

0025 GMT - Near-term risks for Hub24 on expenses and reduced net flow expectations are largely reflected in its current valuation, say Macquarie analysts in a note. For 4Q, Macquarie notes that net flows of A$2.1 billion were affected by elevated gross outflows, but that adviser numbers of 4,011, up 7% quarter on quarter, were a highlight of the update. Adviser numbers should continue to support the company's flows over the medium term, says the investment bank. At the same time, Hub24's skew to lower average balances and pension fund clients should mean that it is less exposed to the trend of people shifting toward off-platform term deposits. Macquarie has an outperform call on the stock, and sees more relative valuation appeal in Hub24 over peer Netwealth. (alice.uribe@wsj.com)

0028 GMT - Computershare's management EPS growth is likely to moderate to about 2.5% by fiscal 2025 unless the share-registry company can find inorganic growth opportunities, Morgan Stanley analysts say in a note. Management EPS--a key measure of profitability--grew 11% in fiscal 2022. Corporate activity is still soft and unlikely to pick up meaningfully before 2H fiscal 2024. Income on funds held for dividends is set to peak in fiscal 2024 at A$920 million before falling to A$880 million a year later, they say. Those forecasts are 6.5% and 11.5% ahead of the average analyst forecast, they add. MS raises target price 5.3% to A$23.80 and stays equal-weight on the stock, which is up 1.4% at A$24.185. (stuart.condie@wsj.com)

2347 GMT - Ansell's structural reorganization and search for productivity savings further reduces the protective-garment manufacturer's earnings visibility, Morgans analyst Derek Jellinek says. He tells clients in a note that a full earnings recovery is hard to forecast amid slowing demand and growing macro worries. His list of risks facing Ansell is long and includes currency moves, the uncertain magnitude of any manufacturing efficiencies and unpredictable sales volumes. Morgans cuts its target price 6.0% to A$21.93 and maintains a hold rating on the stock, which was at A$23.88 ahead of the open. (stuart.condie@wsj.com)

2347 GMT - Management expenses and policyholder growth are likely to be key items for investors during the coming FY 2023 results, say Macquarie analysts in a note. The investment bank thinks that NIB will achieve its 4%-5% net policyholder growth target in FY 2023. Medibank is also likely to achieve its targets in FY 2023. In FY 2024, Macquarie forecasts closing policyholder growth for NIB and Medibank of 3% and 4%, respectively. Generally, the investment bank expects private health insurers to report strong margins in 1H of FY 2024 but reckons that claims catch-up and policyholder growth will become more challenging in 2H.(alice.uribe@wsj.com)

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2329 GMT - Hub24 has a superior near-term flow outlook when compared to its Australian wealth management platform company peers, say Wilson analysts in a note. This they say arises partly from Hub24's higher mix of funds under administration to pension funds and improving quarterly net financial adviser additions as they migrate existing accounts and new business to Hub24 over the next 12 or more months. Wilsons says its FY 2024 forecasts see small increases in outflow rates to reflect current conditions which it expects to begin to normalize through 2H FY 2024. Wilson has an overweight recommendation on the stock. (alice.uribe@wsj.com)

2316 GMT - Praemium, which has the lowest exposure to pension flows relative to rivals Netwealth and Hub24, has felt a greater impact on its short-term flows with the soft 4Q to finish FY 2023, Wilsons analysts say in a note. While funds under administration was just 1% shy of Wilsons' expectations, it sees that the pooled cash balance exiting 4Q was lower than expected. Still, Wilsons says it remains undeterred in its positive outlook for Praemium's shares. It attributes this to other wealth management platform company peers seeing heighted outflows, and Praemium showing improving inflow rates versus previous quarters. Wilsons has an overweight call on the stock.

2253 GMT - Hub24's FY 2024 pipeline looks to be building, with the Australian wealth management platform company signing 28 new distribution agreements, say Jefferies analysts Simon Fitzgerald and William Richardson in a note. Still, they note that Hub24's 4Q update shows that while net inflows were up 12% from 3Q, they were down 14.8% on the previous corresponding period. "With economic uncertainty impacting investor sentiment, Hub24 recorded net inflows for 4Q FY 2023 below the 10-quarter average of A$2.7 billion," says Jefferies, adding that the company needs an increase of A$17.3 billion in funds under administration to reach the lower end of its FY 2024 target. Jefferies cuts its target price 5.2% to A$30.75/share. Hub24 was last down 0.9% to A$25.67/share.

2251 GMT - Ansell is in a tough spot and its search for another round of productivity savings comes with risk, Jefferies analysts say in a note. They tell clients they remain cautious about operational risks and the time it will take for productivity gains to boost profitability. The protective-garment manufacturer is also exposed to unexpected currency moves, they add. Shifts in raw-material price and increased macroeconomic pressures could further disrupt earnings generation, they say. Jefferies cuts target price 18% to A$24.50 and maintains a hold rating on the stock, which was at A$23.88 ahead of the open. (stuart.condie@wsj.com)

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