Josh Gilbert, market analyst at eToro Group Ltd, shares his three things to watch in Australia in the coming days.

AU Westpac Consumer Sentiment 

Westpac consumer sentiment data arrives on Tuesday, against a bit of a puzzling backdrop.

This bout of inflation has been a difficult beast to tame and remains sticky, and the pinballing confidence of shoppers is an inevitable symptom of unclear economic forecasts.

There’s a reason the RBA prefers quarterly CPI readings over monthly, though; even improving conditions can look volatile if you zoom in too far. Zooming out, the most recent eToro Retail Investor Beat revealed half of Aussie investors (50%) are now confident in the Australian economy – up from just 36% last quarter.

The conditions for doing business in Australia do seem to be recovering over the long term. We’ve seen some satisfying retail earnings from the big operators over Q3, and recent rate cuts will continue to benefit households. Still, sentiment may continue to ricochet in the lead-up to Black Friday and Christmas.

Federal Reserve’s tricky week

12 Federal Open Market Committee members are scheduled to deliver individual speeches over the coming days, with investors hoping the addresses provide some insight into the Fed’s current outlook on markets and the economy.

The recent 25bps cut has markets watching eagerly to understand if another cut is on the cards, but these speeches have come at a bad time. The US Government shutdown has seriously disrupted standard processes in the short term, and that risks leaving the Fed without critical data at an important moment.

Meeting minutes from the FOMC’s most recent meeting, arriving Thursday US time, should provide some insights, but while the shutdown lasts, the central bank is suffering from less visibility under an administration that already seems keen to keep Fed chair Jerome Powell out in the cold.

Even if the shutdown is resolved in time for some of these scheduled addresses, it means that the Fed has lost critical footing at a pivotal moment, when it has already made clear that present rate calls will rely on a day-by-day appraisal of key data. With more rate calls due to be made before year’s end, it robs the bank of visibility when it needs sight the most.

Ferrari’s big moment

All eyes were on the prancing horse over the weekend, with Ferrari at the Singapore Formula 1 Grand Prix. Despite an underwhelming result for the team, it’s just the start of a bumper week for the luxury sports car manufacturer.

On October 9th, Ferrari will hold an investor day where it will set new 2024–29 targets and unveil its new EV, making it a crucial watch point. The transition to electric vehicles will test how Ferrari’s ethos translates to a battery-powered era, and expanding its model range risks testing the very exclusivity that underpins its margins. The market’s lofty expectations leave little margin for error, even with Ferrari’s impeccable execution.

Ferrari’s financials are as finely tuned as one of its V12 engines. The company has enjoyed steady growth without abandoning its volume discipline. In 2024, Ferrari delivered 13,752 cars, only up 0.7% vs 2023, yet revenue grew 11.8% to €6.68 billion and 21% higher net profit than the year prior. Profitability is Ferrari’s strong suit. In 2024, its operating margin was 28.3% and EBITDA margin a whopping 38.3%, which is extraordinarily high for any automaker. 

Ferrari’s financials get top marks across the board. Yes, its volume growth isn’t anything to write about, but its profitability and financial stability are some of the best in class. There’s no question that Ferrari has an outstanding business model, a nearly recession-proof luxury brand, loyal high-end clientele, expanding earnings, and disciplined management. Ferrari’s brand equity and pricing power give it a durable advantage that few companies can match.