Market Set To Open Higher
The S&P/ASX 200 futures moved 32 points higher on Friday 12 November 2021, and gained 0.37%. The action is an indication of the potential re-test of the all-time peak of about 8,700 with solid foreign markets and a positive outlook in the earnings picture.
ASX 200 Chart as of 11:38 AM
U.S. Retail Data Fuels Optimism
US retail sales climbed 0.6% month-on-month in June, well above the 0.1% expected rise. Sales excluding autos increased by 0.5%, beating estimates of 0.3%. Control group sales, which feed directly into GDP figures, also gained 0.5%.
Ten of thirteen retail categories recorded growth, led by motor vehicle sales. This outperformance surprised markets, as prior data showed lower unit sales and weaker prices. Restaurant and bar spending rose 0.6%, underlining resilience in services demand.
The stronger data lowered US Federal Reserve rate cut expectations by 3 basis points to 41 basis points of cuts by year-end.
S&P 500 And Nasdaq Set Records
The S&P 500 gained 0.54% setting a record high and the Nasdaq gained 0.75% also hitting a new record high, overnight. These gains were widespread: Financials gained 0.92%, Technology rose 0.89%, Industrials increased by 0.87%, and Staples rose 0.87%.
Real Estate and Healthcare were the only sectors to finish in the red. The equal-weight S&P 500 outperformed the main benchmark by 28 basis points, showing strength beyond the large-cap tech names.
JPMorgan gained 1.4% and entered the top ten US companies by market value.
Corporate Earnings Support Sentiment
Several major US companies reported strong quarterly results, including Netflix, United Airlines, PepsiCo and TSMC.
United Airlines gained 3.1% after posting adjusted EPS of $3.87, about 5% above consensus. Despite a 4% decline in revenue per available seat mile, the carrier saw travel demand surge from July.
Taiwan Semiconductor rose 3.3% after announcing 38.6% revenue growth. Net income reached NT$398.27 billion. EPS came in at US$2.47. Strong AI demand lifted advanced technology sales. Gross margins are forecast between 57% and 59%, weighed down by Foundry 2.0 costs.
PepsiCo shares jumped 7.4% after delivering EPS of $2.12, above the $2.03 estimate. Net sales reached $22.73 billion, up 1% year-on-year. The company lifted its 2025 EPS outlook, expecting a 1.5% decline, revised from 3%.
Netflix Lifts Outlook After Q2 Beat
Netflix gained 1.9% after exceeding Q2 estimates. Revenue rose 16% year-on-year to $11.1 billion, with EPS at $7.19. The company lifted its full-year outlook, now expecting $45.2 billion in revenue and $10 billion in net income.
Over two-thirds of users are international. Foreign exchange tailwinds supported results. Content like Ginny & Georgia and Squid Game drove user engagement. The ad-supported tier gained traction, with revenue expected to double in 2024. Domestic revenue still grew 15% despite slower US subscriber growth.
Yancoal Reports Production Growth
Yancoal Australia released its Q2 report after market close. Attributable run-of-mine coal production rose 17% to 12.7 million tonnes. Saleable coal output increased 15% to 9.4 million tonnes. The average coal price declined 22% to A$142 per tonne.
Closing cash stood at $1.8 billion as of 30 June 2025. The CEO noted: “We have delivered the best first-half operational performance of the past five years.” Yancoal expects to hit the upper range of its 35–39 million tonne production guidance this year.
China Disruption Boosts Lithium Stocks
Chinese regulators ordered Zangge Mining to halt operations at its Qarhan brine project due to illegal activity. The project accounts for roughly 1% of global lithium carbonate supply in 2025. The move follows other regulatory actions on Yichun lepidolite production.
The shutdown improved sentiment in lithium markets. SQM’s latest SC6 auction cleared at US$750 a tonne, above spot levels. Pilbara Minerals recovered from a 5% intraday drop to close 1.9% higher.
Watch Graphite Stocks Following Us Tariffs
The US imposed a 93.5% anti-dumping duty on Chinese graphite, leading to a total tariff of 160%. The decision followed complaints by domestic producers. The US Commerce Department will finalise the ruling by 5 December.
China supplied about two-thirds of US graphite imports in 2023. Global graphite stocks jumped. Graphite One rose 19.7%, Westwater Resources climbed 15.3%, Nouveau Monde Graphite gained 25.8%, and Northern Graphite added 4.2%.
BHP Reports Record Output
BHP delivered record quarterly and annual production of copper and iron ore. Q4 iron ore output reached 70.3 million tonnes, up 2% year-on-year, beating estimates by 1.6%. Copper production hit 516,200 tonnes, 3.4% above consensus.
Full-year iron ore production totalled 263 million tonnes. Copper output reached 2.02 million tonnes, beating midpoint guidance by 3.7%. CEO Mike Henry said: “BHP delivered record iron ore and copper production, which demonstrates the strength and resilience of our business.”
The company remains on track for FY25 unit cost guidance across key operations. Jansen Stage 1 potash project is now 68% complete.
Syrah Surges On Graphite Tariffs
Syrah Resources opened 34.4% higher at 39 cents after the US imposed tariffs on Chinese graphite. The stock trimmed gains to trade up 25.8% at 36.5 cents by mid-morning.
Droneshield Weakens After Analyst Downgrade
Droneshield fell 6.8% on Friday, extending its recent pullback. Bell Potter downgraded the stock to Hold from Buy. The analysts lifted their price target to $3.80 from $2.60, citing valuation risks despite strong sector momentum.
