0024 GMT - Listings on Carsales.com point to a positive start to its fiscal year, Citi analyst Siraj Ahmed says in an analysis of the company's listings. Private listings are up around 60% year-over-year, while dealer listings continue to increase, he says. "While this likely reflects an increase in time to sell/aged inventory, overall this points to a better-than-expected start to the year especially for Private," Citi says. Still, Carsales' price increases are slightly below Citi expectations. Citi has a buy call and a A$29.65 target price on the stock, which is up 0.2% to A$28.92. (alice.uribe@wsj.com)

0009 GMT - Higher Australian rates have led to slower business lending growth, but mortgage growth has been resilient, Citi analysts say in a review of Australian regulator data. The overall slowdown of lending growth is driven by business lending which decelerated from high double digits in mid-2022 to around 1% (three months annualized). In contrast, mortgage lending growth has remained in the 5%-6% range, broadly similar to levels last year. "This extraordinary strength in the mortgage market stems from ebullient housing sentiment on account of higher population growth, overseas migration, robust wage growth, rising rents, and lack of new housing supply," Citi says, adding that slowing lending growth has taken some pressure off deposit pricing, which has been under severe stress in the last six months. ( alice.uribe@ewsj.com )

0008 GMT - With the RBA expected to keep the official cash rate on hold at 4.1% this week, the issue of negative interest-rate differentials could again be a theme that weighs on AUD/USD. Australia has a lower OCR than many other major economies and the gap, which is well over 100 basis points in many cases, could see the currency pair drift closer to 0.6000 over time from around 0.6450 now. Still, any further news of increased efforts to bolster China's economy could quickly see that downdraft for AUD/USD lose strength, CBA says in a market strategy note. (james.glynn@wsj.com; @JamesGlynnWSJ)

0004 GMT - There is no sign of deterioration in Australian banks' asset quality, even 18 months into this interest-rate tightening cycle, say Citi analysts in a note. During this time, banks have been strengthening balance sheets, accumulating large loan-loss provisioning and wide capital buffers to hopefully avoid a potential crisis. "A key message during August results was the strength of the balance-sheet settings. Bank management have signaled that significant excess provisioning and capital are likely to be returned sooner than expected, implying an improving earnings per share outlook," says Citi. It reckons that consensus estimates haven't adjusted to this revised scenario, and has a neutral view on the sector, but says banks could outperform on a relative basis. (alice.uribe@wsj.com)

2318 GMT - Macquarie's bias toward defensive stocks in Australia has disappointed so far, but the bank suggests investors should double down in the aftermath of the August earnings season. "We still think unemployment will rise," the bank says in a note. "In past cases where the RBA paused ahead of a U.S. recession, this coincided with higher unemployment." Macquarie says long-lead indicators, including the yield curve, still suggest a U.S. recession is likely, even if delayed to early 2024. "Given our expectation of cyclical weakness, adding to defensives that sold off recently is likely a good strategy," says Macquarie, singling out CSL, ResMed, Coles, Transurban and Telstra as strong bets. (david.winning@wsj.com; @dwinningWSJ)

2309 GMT - City Chic Collective's discounting persisted into 1H, as it flagged at the May downgrade, driving early sales for the period down, say Macquarie analysts in a note. Overall for 1H, sales were down 33%, while ANZ fell 34% and the U.S was down 31%. Still, the company's strategic review is finished, and it will focus on customers with higher order values and repeat purchase tendencies. City Chic, Macquarie says, expects to be profitable in 2H, but the investment bank thinks the company will still be loss making in FY 2024, and keeps its neutral call. For FY 2023, City Chic delivered earnings below Macquarie's estimates and consensus forecasts. At the same time, promotions were more elevated versus Macquarie's forecasts. (alice.uribe@wsj.com)

2303 GMT - Santos investors should get ready for Part 2 of a strategy to reduce its equity interest in the PNG LNG project in Papua New Guinea. Santos last week agreed to sell 2.6% of PNG LNG to Kumul for $576 million cash plus the assumption of $169 million of project debt. Santos also granted Kumul a call option to buy another 2.4% for $524 million. "With the exclusivity arrangement with Kumul now expired, we expect Santos to market another 5% stake," Citi analyst James Byrne says in a note. (david.winning@wsj.com; @dwinningWSJ)

2252 GMT - Fisher & Paykel Healthcare loses a bull in Macquarie, which predicts the medical-device maker needs a big step up in 2H earnings to achieve guidance. In a note, Macquarie says it now expects an annual net profit of NZ$254 million, which equates to a 60% skew toward 2H. Its forecast is 2% below consensus expectations. "We see the delivery of improved volumes in 2H as required in order to meet FY 2024 gross margin guidance and our earnings forecasts," says the bank, dropping to neutral from outperform.(david.winning@wsj.com; @dwinningWSJ)

2243 GMT - Ivestors can anticipate a share buyback from Santos following the restructuring of its deal to sell up to a 5% stake in the PNG LNG project to Kumul Petroleum, says Macquarie. Santos has agreed to sell 2.6% of PNG LNG to Kumul for $576 million cash plus the assumption of $169 million of project debt. Santos also granted Kumul a call option to buy another 2.4% for $524 million. "Assuming only the 2.6% selldown, Santos's gearing should be around 15% at Dec. 31, providing capacity for a buyback ranging from $600 million-$800 million on top of a 14.3 U.S. cents/share final dividend," Macquarie says. (david.winning@wsj.com; @dwinningWSJ)

2239 GMT - Kumul Petroleum is unlikely to call the option that formed part of its restructured deal with Santos for up to 5% of the PNG LNG project, Macquarie says in a note. Santos last week agreed to sell 2.6% of PNG LNG to Kumul for $576 million cash plus the assumption of $169 million of project debt. Santos also granted Kumul a call option to buy another 2.4% for $524 million. If Kumul chooses not to exercise the call option then Santos has flexibility to either retain that 2.4% interest or shop it to other buyers, says Macquarie. (david.winning@wsj.com; @dwinningWSJ)

2221 GMT - Australian commercial property values still haven't fully adjusted to higher interest rates, Jefferies analyst Sholto Maconochie says at the conclusion of the August reporting season. The RBA has raised official interest rates by 400 basis points in just over a year to cool inflation, and Jefferies expects a further 5-15% fall in property asset values in FY 2024. Cap rates are forecast to expand by 25-75 bps, Maconochie adds. "Resi demand stabilized from 1H23 lows, retail and industrial reported strong operating metrics, but retail sales slowed in 4Q23, with office leasing resilient and occupancy flat," he said in summary of the reporting season. Half of property stocks covered by Jefferies beat expectations, with roughly a third delivering an in-line result. (david.winning@wsj.com; @dwinningWSJ)

(END) Dow Jones Newswires