0355 GMT - If ANZ were to abandon its bid to buy Suncorp's bank, this would likely leave it with significant surplus capital, Citi analysts say in a note. This would also likely free up management resources to focus on bedding down its ANZ Plus app and making gains in institutional banking, they say. Citi notes that ANZ has the right to appeal the Australian regulator's rejection of its Suncorp bid via the Australian Competition Tribunal. If the tribunal finds in ANZ's favor, Citi says the transaction will proceed and ANZ will embark on the process of acquiring scale and extracting synergies. "However, this will likely be a six-month process in itself, adding to the unusually long-dated merger benefits and timeline, which is already likely to fall outside of the current leadership cycle of the bank." (alice.uribe@wsj.com)

0345 GMT - ANZ's bid to buy Suncorp's banking unit could still be successful, even though the Australia's competition regulator blocked the sale, S&P Global Ratings says in a note. Suncorp has indicated that it would support ANZ in the next phase of the merger authorization process, S&P notes. "This is likely to be a referral of the Australian Competition & Consumer Commission's decision to the Australian Competition Tribunal," the ratings company says, and as a consequence it sees that the successful acquisition of Suncorp's bank by ANZ remains a plausible outcome. If the acquisition doesn'tproceed, S&P'sratings on Suncorp's bankis likely to remain unchanged.(alice.uribe@wsj.com)

0126 GMT - ANZ's bid to buy Suncorp's banking unit may have a stronger chance of being approved by the Australian Competition Tribunal, than by the ACCC, which today rejected the proposed deal, say Citi analysts in a note. "It is our understanding that the tribunal will be subject to slightly different criteria," Citi says while adding that approval is far from certain. This process could delay the sale by another nine months to mid-2024, with the market likely seeing the ACCC's verdict as a disappointment. ACCC's verdict will also likely delay any Suncorp plans for a capital return. "In our view, this will leave the FY 2023 capital position bearing the full brunt of the recent reinsurance renewal which was quite costly from a capital usage perspective," Citi says. It has a buy call on Suncorp's stock.(alice.uribe@wsj.com)

0107 GMT - Australian banks are expected to show no meaningful credit concerns in their coming reporting season, Morgan Stanley analysts say in a note. While lenders' credit quality will likely remain sound, MS forecasts the major banks' average loss rate on quarter to increase around 2 basis points to around 14bp of loans for the three months ended June. "We still expect loss rates to rise above the long-run average next year, but better near-term outcomes are looking more likely," MS says. The investment bank says margins and expense growth outlook remain sources of downside risk. It also sees deposit competition and a mix between cheaper and more expensive accounts as bigger swing factors in 2023-2024 than mortgage discounting. (alice.uribe@wsj.com)

0049 GMT - City Chic Collective's sale of its underperforming U.K. business reduces the risk that the clothing retailer will have to raise equity, E&P Financial analysts say. They still reckon that City Chic can return to profitability by right-sizing its inventory, restocking for seasonality, and improving supply-chain agility. Its strong Australian business has been greatly hindered by poor international expansion efforts and inventory management, they say in a note. They add that the lack of a trading update likely suggests recent trading has not materially improved. E&P maintains its speculative buy rating on City Chic. It has a last-published A$0.72 target price on the stock, which is up 21% at A$0.58. (stuart.condie@wsj.com)

0019 GMT - Xero's U.K. price rises look will likely validate rather than increase market expectations for the cloud-accounting provider's revenues, E&P Financial analyst Paul Mason says. The price increases, which range from 7.1% for lower-tier packages and up to 17% for higher tiers, are broadly in line or slightly higher than the market anticipated, Mason writes in a note to clients. The net price rise works out to about 6% because Xero is holding prices on some other plans, he adds. E&P has a last-published positive recommendation and A$126.00 target price on the stock, which is down 0.6% at A$119.69. (stuart.condie@wsj.com)

2341 GMT - City Chic Collective's exit from Europe, the Middle East and Africa makes both strategic and financial sense for the women's clothing retailer, Morgan Stanley analysts say in a note. They tell clients that the exit should be a positive catalyst for the stock, but warn that the long-term impact of aggressive discounting on City Chic's brands isn't clear. There's a risk that margins could be permanently impaired if discounting becomes entrenched, they add. MS has a last-published equal-weight rating and A$0.40 target price on the stock, which was at A$0.48 ahead of the open. (stuart.condie@wsj.com)

2334 GMT - ResMed's 4Q earnings suggest that the breathing-tech provider's margin recovery will take longer than previously expected, Citi analyst Mathieu Chevrier says. He tells clients in a note that adjusted gross margin of 55.8% was 65 bps lower than the average analyst forecast. Management commentary points to improvement through FY 2024 but at a slower pace than the market had been expecting, he adds. Citi has a buy rating and A$40.50 target price on the stock, which was at A$33.85 ahead of the open. (stuart.condie@wsj.com)

2317 GMT - The lack of a trading update from marketing company IVE Group suggests it is on track to meet or beat FY 2023 guidance, says Bell Potter. And with the stock down around 16% from its March peak, Bell Potter says now is a good opportunity for investors to expand positions. "We also note the final dividend is likely to be similar to the interim--we forecast 9.0 (Australian) cents fully franked versus 9.5 cents fully franked at the half--which on its own equates to a yield of close to 4%," says analyst Chris Savage in a note. Bell Potter expects IVE's FY 2024 guidance to be solid, driven largely by a full 12-month contribution from the Ovato business but potentially reflecting energy savings and lower freight costs as well. (david.winning@wsj.com; @dwinningWSJ)

2304 GMT - JB Hi-Fi has a track record of pre-announcing sales and net profit around 20 days after a reporting period ends. Not this time. "The absence of a pre-announcement this time is interesting," Jefferies analyst Michael Simotas says in a note. "It likely indicates the FY 2023 result will be largely consistent with (or slightly better than) consensus, but we believe recent trading has been more challenging and volatile." Jefferies expects JB Hi-Fi to provide an update on July sales alongside its result. The bank believes trading conditions worsened last month. "While the group has continued to benefit from share gains from Harvey Norman, we expect the 4-year trend has deteriorated and sales are now declining year-over-year," Simotas says. (david.winning@wsj.com; @dwinningWSJ)

2301 GMT - Australian investment-management firm Pinnacle is likely to keep growing funds under management, supported by improved net inflows as investor sentiment recovers, says Morningstar analyst Shaun Ler in a note. But, he reckons that this won't be more pronounced until fiscal 2025. "A diverse product set and distribution channel, alongside strong investment performance, are also likely to drive future business wins," he says. For fiscal 2023, which Pinnacle reported on this week, Morningstar notes that earnings per share was broadly flat, but it still beat the research company's expectations. Other positive surprises were considerably higher performance fees and gains on principal investments. "A key disappointment was much higher investments into future growth that dampened margins, a recurring theme," says Morningstar. (alice.uribe@wsj.com)

2249 GMT - China is due to make a decision about tariffs on Australian barley by August 11, and Jefferies thinks that will likely be a precursor for a decision on tariffs on wine. With Treasury Wine Estates due to report its FY 2023 earnings on August 15, Jefferies is looking for the company to provide an update on the potential upside from China if the tariff is dropped. "Treasury Wine used to generate circa A$200 million Ebit from China, which we believe implies at least A$80 million incremental upside," analyst Michael Simotas says in a note. "However, it will take time to rebuild supply." (david.winning@wsj.com; @dwinningWSJ)

2241 GMT - Despite Harvey Norman's earnings downgrade in June pointing to acute operating deleverage, its stock has outperformed and is now trading around 17% above its property value of A$3.20/share. That's hard for Jefferies to justify and it downgrades the stock to underperform from hold. "We expect sales to remain weak, with soft conditions compounded by market share losses and adverse category mix," analyst Michael Simotas says in a note. "In previous cycles, the stock has tended to trade at or around the book value of property until conditions turn." Harvey Norman ended Thursday at A$3.77 and Jefferies expects the stock to trade back toward A$3.20. (david.winning@wsj.com; @dwinningWSJ)

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2239 GMT -- City Chic Collective's exit from Europe solves one problem, but plenty remain for the plus-size clothing retailer, says Ord Minnett. City Chic late yesterday said it has sold its Evans business and inventory in the region to AK Retail Holdings for GBP8 Million. "Overall, the divestment of its loss-making European operations will be taken positively by investors," analyst James Casey says in a note. "However, City Chic faces further challenges in right-sizing its inventory position, finding a pathway to profitability in the U.S. and trading with significant headwinds in its profitable domestic market." Ord Minnett raises its price target by 20%, to A$0.60/share, while retaining a Hold recommendation. City Chic ended Thursday at A$0.48. (david.winning@wsj.com; @dwinningWSJ)

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