MPC Morning Call 4th December 2025 – Weak Jobs data fuels rate cut hopes as Salesforce upgrades AI Agent demand
The broader market rallied while Big tech weighed overnight as weak private payrolls fuelled rate cut hopes, meanwhile Salesforce upgraded its guidance on enterprise Agentic AI demand, a key sign of end user monetisation of AI
MPC Morning Call 4 th December 2025 – Weak Jobs data fuels rate cut hopes as Salesforce upgrades AI Agent demand The broader market rallied while Big tech weighed overnight as weak private payrolls fuelled rate cut hopes, meanwhile Salesforce upgraded its guidance on enterprise Agentic AI demand, a key sign of end user monetisation of AI U.S. private payrolls unexpectedly contracted in November, declining by 32,000, according to the ADP National Employment Report. Economists had expected a modest gain, but hiring stagnation across industries, led by small businesses, reflected a cooling job market amid cautious consumer spending and macroeconomic uncertainty. The weak data reinforced market bets that the Federal Reserve will cut interest rates at its upcoming December meeting, with traders now assigning nearly a 90% probability of a 25-basis-point reduction. Attention now shifts to the upcoming Personal Consumption Expenditures report, the Fed's preferred inflation gauge, which could influence the scale and pace of future monetary easing. Tech stocks saw mixed performance as Microsoft shares dipped following reports that the company had lowered AI sales expectations, despite management denial. Other AI-linked names like NVIDIA and Broadcom also traded lower, while Marvell surged after announcing a $3.25 billion deal to acquire Celestial AI, expanding its capacity in photonics-based chip technology. The acquisition aims to strengthen Marvell’s position during the ongoing AI hardware boom, with meaningful revenue expected by fiscal 2028. Meanwhile, strong results from Microchip Technology and Okta lifted their stocks, and Tesla gained on expectations of new U.S. government support for robotics development. Salesforce delivered a standout quarterly report that beat Wall Street estimates, driven by soaring demand for its AI-driven Agentforce and Data 360 products. Revenue rose to $10.3 billion, and the company raised its full-year outlook to over $41 billion. CEO Marc Benioff highlighted the explosive growth of Salesforce’s AI platform, noting a 114% year-over-year increase in annual recurring revenue from its agentic products. In banking, Morgan Stanley is reportedly exploring ways to offload some of its data center exposure through a significant risk transfer tied to AI infrastructure loans. The potential move underscores growing efforts by major lenders to manage emerging risks in the fast-expanding AI financing landscape. ASX Overnight: SPI 8620 (+0.24%) The Day Ahead: Expect a good day from the ASX as the weak GDP numbers yesterday leaves the door open (maybe ajar) for a rate cut domestically and copper prices drive the big miners higher. Regional lender Bendigo Bank will acquire RACQ Bank’s book of $2.7b in loans and $2.5b in deposits Cash Converters has acquired 29 east coast franchise stores for $37.1 million, forming the Cash Converters Investment Group (CCIG) Regis Healthcare has agreed to sell its Ayr and Home Hill aged care homes in North Queensland to not-for-profit provider Ozcare.
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