The Australian Securities Exchange was hit by an outage to its announcements platform on Monday, the latest setback for the stock exchange operator that is already under scrutiny from regulators over its governance and ability to deliver market infrastructure. (TR)
US
Dell’s revenue slightly missed while EPS beat at $2.59 on other stronger margins. AI carried the quarter, with $5.6B in AI server shipments and 37% y/y growth in servers and networking easily outweighing softness in PC sales. Dell guided a strong Q4 with $31.5B in revenue and $3.50 EPS, driven by $9.4B in expected AI sales and a higher full year AI server outlook.
Burlington warm weather dragged traffic and muted comps after back to school, highlighting how fragile discretionary demand is even in off price. Trends improved as temperatures cooled, but the quarter reinforced the broader theme of weather volatility and cautious consumers.
Dicks delivered strong core comps and moved quickly to shut weak Foot Locker stores, highlighting the split between resilient higher income sports spending and softer lower income demand, while still guiding confidently into the holidays
Best Buy lifted its forecast after a tech upgrade wave boosted comps, highlighting how innovation can unlock spending even as shoppers stay selective heading into the holidays.
Abercrombie & Fitch surged as Hollister’s strength and sharper youth momentum carried the quarter while the namesake brand softened, underscoring a holiday theme of teen driven demand outpacing slowing legacy banners.
Shares of Strategy tumbled after the bitcoin champion launched a US dollar reserve to fund its dividends and warned that it could incur a $5.5bn loss if the price of the cryptocurrency does not rebound this year. ($FT)
Crypto
Bitcoin fell back below $90,000 on Monday, extending losses after its steepest monthly decline since the 2021 crypto crash, as renewed risk aversion drove investors out of stocks and digital assets. (TR)
Economy
Q3 construction work done came in softer, falling -0.7% q/q, but weakness was driven by the unwind of a mining related spike related to the ABS’ recognition of installed imported structures on a cash basis (whereas GDP is on an accruals basis). Outside of this, activity was solid, up 3.6%qtr and 3.0% in annual terms – strongest quarterly growth rate since 2017 (excl. COVID).
Q3 CAPEX soared to 6.4% beating expectations (0.5%). While this is mostly a data centre story, it adds to rebounding household consumption underscoring a broadening private sector recovery. CAPEX plans were also upgraded to show a 7% gain in real terms.
China’s tightening export controls are pushing European firms to explore new supply chain capacity outside of the world’s second-largest economy, a European lobbying group said on Monday, seeking cover from the U.S.-China trade war. (TR)
The year that started with a rate hike in Japan might just end with another after the clearest signal yet from Bank of Japan Governor Kazuo Ueda of a possible move soon, setting up the stage for a pivotal month for monetary policy divergence. (TR)
Australian home prices rose in November with large gains in several state capitals, amid a record level of housing unaffordability, property consultant Cotality said on Monday. (TR)
Wages paid by businesses grew at their fastest pace in almost two years and outstripped tepid growth in company profits, a further sign of high labour costs that could feed into inflation and fuel cost-of-living pressures the government is trying to contain. ($AFR)
U.S. manufacturing contracted for the ninth straight month in November, with factories facing slumping orders and higher prices for inputs as the drag from import tariffs persisted. (TR)
Business
Google’s Gemini is catching up to ChatGPT: Last week’s release of Gemini 3 has helped to boost both Alphabet’s stock and the chatbot’s usage, with monthly downloads now just below ChatGPT’s. Average minutes spent per visit has also increased, with Gemini users chatting for an industry leading ~7 minutes each time they visit the app or website.
Elon is bullish Google and Nvidia: In a recent podcast, Elon said Google has “laid the groundwork for an immense amount of value creation from an AI standpoint,” and adds that Nvidia is now an obvious winner. Elon also says that AI, robotics, and spaceflight companies will be the main value drivers in the future.
HP to Cut Up to 6,000 Jobs as AI Reshapes Operations: The Company said it will eliminate up to 10% of its workforce by 2028 as it leans on AI to streamline product development, internal processes and customer support. HP warned that rising memory-chip costs could pressure margins next year even as demand for AI-enabled PCs grow. It’s hard to differentiate what is real replacement from AI vs. “AI speak” masking a declining business.
Top consultancies have frozen starting salaries for the third consecutive year as artificial intelligence starts to reshape the industry, forcing firms to reconsider their traditional “pyramid” structure. ($FT)
Currencies
USD/JPY has unwound some of the sharp gains seen in recent months as chances of a BoJ hike at their December meeting firm (+19bp priced up from +5bp last week). MoF jawboning against excessive JPY weakness has also helped stabilise JPY. 2-year JGB yields pushed above 1% for the first time since 2008 today following a more confident BoJ Governor Ueda, signalling that December is live, despite constant pressure of late from the new government to keep rates steady.
AUD/JPY finished the week near YTD highs of 102.50, however broke below 101.80 today following Ueda’s comments keeping a Dec. hike on the table.
AUD/NZD was hanging around 1.15+ levels for the better part of last week, but came a cropper following the relatively hawkish RBNZ, signalling limited scope for further easing. The cross declined 1% and AUD/NZD starts the week trading nearer 1.1420. After a near 6 month uninterrupted run higher from 1.08-1.16, hard questions are being asked about the longer term outlook for this cross now that the RBNZ easing cycle appears to have drawn to a close.
AUD/EUR was modestly higher over the week supported by last week’s strong CPI and CAPEX data. AUD/EUR has been contained to a very well defined 0.55-0.57 range in the last 6 months and starts the week at 0.5635.
Politics
Ex-UK minister Tulip Siddiq receives two-year jail sentence in Bangladesh. ($FT)
Deal Flow
Databricks is set to raise $5B at a $134B valuation: The tech company’s latest funding round is designed to help employees sell shares, showing that the company is in no rush to IPO. Databricks also boosted their sales forecast to expectations of 55% growth this year, but noted it is operating at roughly breakeven.
Vimeo was officially acquired for $1.28B by Bending Spoons. EV/Net Income was 824.07x and EV/Revenue was 3.07x. Allen & Company advised on the sale.
Revolut, developer of a foreign exchange and money-transferring application, raised $3.0B of venture funding led by Coatue Management, Dragoneer Investment Group, Fidelity Management & Research, and Greenoaks Capital Partners at a pre-money valuation of $72.0B.
Italy’s billionaire Benetton family is combining its private capital business with a rival, as it embarks on an ambitious plan to triple its assets under management to €10bn in the next five years. ($FT)
After more than a month of due diligence, two major buyout firms have walked away from a proposal to acquire AUB Group, which would have valued the insurance broker and underwriter at more than $5 billion. ($AFR)
OpenAI has taken a stake in Thrive Holdings, a company set up by one of its biggest investors, in the latest of a series of circular deals that have enmeshed the $500bn start-up with its customers, suppliers and backers. ($FT)
Blackstone is nearing an acquisition of utility-parts maker MacLean Power Systems from Centerbridge Partners for $4B.
Mining giant Rio Tinto is seeking to divest its boron-producing US assets.
