Between the Bells

Wall St fell on Friday as the Dow Jones closed out its worst week since October losing 0.18% by the closing bell. The S&P 500 lost 0.65% and the tech-heavy Nasdaq fell 1.16%. US unemployment data was also released on Friday coming in at 3.9%, 0.2% higher than the forecast and consensus of 3.7%.

In terms of US stocks, despite rising 6% over the week, Nvidia lost 5% in its worst session since last May.

Over in Europe, markets closed mix following the European Central Bank’s inflation forecast and US jobs data release. The STOXX 600 closed 0.03% higher, led by the financial sector which gained 1%, whilst the technology sector lost 1.5%. Germany’s DAX closed 0.16% lower, as did the FTSE 100 which fell 0.43%, whilst the French CAC gained 0.15%.

Locally on Friday, the ASX200 gained over 1% with all but the industrial sector finishing in the green. Gains were led by the financial and health sectors up 2.03% and 1.25% respectively. 

What to watch today: 

• The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.6% at market open this morning.
• On the commodity front this morning,
   
  • Oil is down 1.17% to US$78.01 a barrel as the market remains cautious on Chinese demand, despite the OPEC+ group extending supply cuts. 
  • Gold is up 0.9% to US$2178 and ounce and iron ore is trading 0.85% higher at US$118.50 a barrel.

Trading Ideas: 

• Bell Potter has maintained a buy rating on Develop Global (ASX:DVP), despite decreasing its price target to $4.10. The buy rating is maintained by Bell Potter as the forthcoming restart of Woodlawn operations coincides with growing revenue generation from the company’s underground mining services business, underpinning a ramp up in earnings in FY24-FY26.
• And Trading Central has identified a bullish signal in Infomedia (ASX:IFM), indicating that the stock price may rise from the close of $1.65 to the range of $1.90-$1.96, on a pattern formed over 11 days, according to the standard principles of technical analysis.

The stock market isn’t always smooth sailing, reacting not just to company performance but also to the ever-shifting tides of global events. Geopolitical tensions from ongoing wars to escalating cyber threats, can create uncertainty and market volatility. However, for investors, this doesn’t necessarily translate to negative outcomes. By understanding the risks and focusing on long-term strategies, investors can navigate these choppy waters and position themselves for continued growth.

In this week’s wrap, Sophia covers:  

• (0:28): the importance of long-term wealth building strategies
• (1:07): major geopolitical risks
• (1:22): cybersecurity in the investment landscape
• (1:55): impacts of US-China tensions on markets
• (2:29): why the energy sector is one to watch
• (4:00): the most traded stocks & ETFs by Bell Direct clients
• (4:34): economic data to watch next week.

Wall St closed higher overnight as the S&P 500 and the Nasdaq hit new records. The Dow Jones rose 0.35%, the S&P 500 jumped just over 1% and the tech-heavy Nasdaq rallied over 1.5%. 

Over in Europe, markets closed higher overnight as the European Central Bank’s held its interest rates steady at a record 4% and revised inflation in 2024 to 2.3% from 2.7%. Germany’s DAX finished 0.71% higher, the French CAC gained 0.77% and over in the UK the FTSE100 ended the trading session 0.17% in the green.

Locally yesterday, the ASX200 closed 0.39% higher as the vast majority of sectors finished in the green. Gains were led by the industrial and information technology sectors which rallied by 1.33% and 1.03% respectively. This was slightly offset by the energy sector which lost 1.15% by the closing bell.

What to watch today: 

• The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.63% at market open this morning.
• On the commodities front this morning,
   
  • Oil is down 0.2% to US$78.97 a barrel as the latest EIA report showed a smaller-than-expected increase in US crude inventories. 
  • Gold is up 0.47% to US$2158 an ounce as investors await key US jobs data on Friday. 
  • And iron ore is trading 1.29% higher at US$117.50 a tonne.

Trading ideas:

• Bell Potter has maintained a speculative buy rating on WA1 Resources (ASX:WA1) with a valuation of $17.65. WA1 is advancing the West Arunta Niobium project which includes the Luni prospect in North-Western Australia. Luni has the potential to be a globally significant Tier-1 asset characterised by its high-grade and scale.
• And Trading Central has identified a bullish signal on Abacus Group (ASX:ABG), indicating that the stock price may rise from the close of $1.16 to the range of $1.25-$1.27 on a pattern formed over 37 days, according to the standard principles of technical analysis.

It was a positive session on Wall Street overnight, with the market turning a corner after a few consecutive losing sessions.  with the Dow Jones up 0.2%, the S&P500 up 0.5% and the Nasdaq up 0.6%. 

European markets also advanced with all major benchmarks closing in the green. 

What to watch today:

• The Australian share market is set to open higher this morning, with the SPI futures suggesting a 0.48% rise at the open. 
• In commodities, 
  • The price of oil is up 1.3%, just over US$79 per barrel, nearing a four-month high after the Energy Information Administration showed a smaller than expected increase in US weekly crude stocks. 
  • Gold is steady, hovering at its record high of US$2,146 an ounce. 
  • And iron ore is flat at US$116 per ton, the lowest since late October. 
• BHP’s share price may trade lower today as the mining giant’s shares are set to trade ex-dividend this morning. Other stocks going ex-dividend today include Rio Tinto (ASX:RIO), South 32 (ASX:S32), Woodside Energy (ASX:WDS) and Viva energy Group (ASX:VEA), just to name a few. 

Trading Ideas:

• Bell Potter maintains a speculative buy rating on Clarity Pharmaceuticals (ASX:CU6) and has increased its valuation to $3.90. The buy rating is maintained as CU6 have a clinical advantage over currently marketed PSMA targeted imaging agents. The stock’s current share price if $2.85, which implies 36.8% share price growth in a year.
• And Trading Central has identified a bullish signal on Metcash (ASX:MTS), indicating that the stock price may rise from the close of $3.76 to the range of $3.99-$4.05, on a pattern formed over 16 days, according to the standard principles of technical analysis.

Wall St fell overnight as Apple shares declined, pulling technology stocks down. The Dow Jones and the S&P 500 lost just over 1% each with the tech-heavy Nasdaq ending the session 1.65% in the red. Apple lost 3% following the release of a report from Counterpoint Research that showed iPhone sales in China plunged in the first six weeks of 2024. 

Other tech stocks such as Netflix and Microsoft also fell by more than 2% each with Tesla following suit, losing 3%.

Over in Europe, markets closed lower as they struggle to find positive momentum with investors awaiting the ECB meeting later in the week. The STOXX600 ended the day down 0.27% with the majority of sectors closing lower with mining stocks falling 0.9% whilst the utilities sector added 1.8%. Germany’s DAX closed 0.1% lower, the French CAC fell 0.3% and over in the UK the FTSE100 closed 0.08% in the green.

Locally yesterday, the ASX200 fell 0.15% with the consumer discretionary and consumer staples sector leading losses down 1.21% and 1.05% respectively. This was offset by the health sector which gained 1% by the closing bell.

What to watch today: 

• The Australian share market is set to open lower, with the SPI futures suggesting a fall 0.26% at market open this morning.
• In terms of economic news, Australian GDP growth data will be released this morning with a forecast of 0.2% growth quarter on quarter, the same as its previous result.
• On the commodities front this morning,
   
  • Oil is trading 0.65% lower at US$78.23 a barrel as uncertainties surrounding interest rates changes in major economies, add to market uncertainty. 
  • Gold is trading 0.7% higher at US$2129 an ounce and iron ore is trading 1.28% lower at US$116 a tonne. 

Trading Ideas: 

• Bell Potter maintains a buy rating on GrainCorp (ASX:GNC) and has an unchanged 12-month price target of $9.30. The buy rating is maintained by Bell Potter as they continue to view the GrainCorp share price as not reflecting the underlying improvement in through the cycle earnings and GrainCorp has a stronger balance sheet position of $350m in net corporate cash.
• And Trading Central has identified a bearish signal in Australian United Investment (ASX:AUI), indicating that the stock may fall from the close of $9.91 to the range of $9.48-$9.56 on a pattern formed over 8 days according to the standard principles of technical analysis.

Wall St closed lower overnight, despite a rally in AI stocks as part of the artificial intelligence boom. The S&P500 lost 0.12%, the Dow Jones fell 0.25% and the tech-heavy Nasdaq ended the trading session 0.41% lower. These losses were pulled back by AI company Nvidia, which soared 18% as the S&P Dow Jones indices revealed it would join the S&P 500 later this month.

Over in Europe, markets closed slightly lower as investors await the European Central Bank meeting. The STOXX600 closed 0.07% lower with most stocks closing in the red including mining stocks which fell 1.24% with tech stocks gaining 0.8%. Germany’s DAX closed 0.11% lower, the French CAC gained 0.28% and over in the UK the FTSE100 closed just over half a percent down.

Locally yesterday, markets closed 0.13% lower as the majority of sectors finished in the red. Losses were led by the health and utilities sector which lost 0.78% and 0.77% respectively. This was slightly offset by the real estate sector which gained 1.34%.

What to watch today: 

• The Australian share market is set to open slightly higher, with the SPI futures suggesting a rise of 0.05% at the open this morning.
• On the commodity front this morning,
   
  • Oil is trading down 1.54% at US$78.13 a barrel after OPEC and its allies agreed to extend voluntary production cuts until the end of June. 
  • Gold is trading 1.62% higher to US$2117 an ounce and iron ore is trading flat at US$117.50 cents a tonne.

Trading Ideas: 

• Bell Potter maintains a buy rating on DroneShield (ASX:DRO) with a 12-month price target of $0.90. The buy rating is maintained by Bell Potter as DroneShield is now a profitable growth company after its first profitable year with an NPAT of $9.3m. The company is also exposed to relevant investment trends, including rising defence expenditure globally, the increasing risk of drones and the role of AI/ML technology.
• And Trading Central has identified a bullish signal in Piedmont Lithium (ASX:PLL), indicating that the stock price may rise from the close of $0.24 to the range of $0.28-$0.30, on a pattern formed over 21 days, according to the standard principles of technical analysis.

Well, it was a positive session on Wall Street, with all three major benchmarks closing in the green on Friday. The tech-heavy Nasdaq surged more than 1%, to an all-time high, surpassing its 2021 record as investors look to tech stocks amid the AI boom. Meanwhile the Dow Jones gained 0.23% and the S&P500 gained 0.8%. 

Locally, the ASX200 ended the week with a 1.3% gain, with the tech sector leading the market, up 8% Monday to Friday. 

What to watch today:

• The Australian share market is set to rise 0.14% at the open this morning. 
• In commodities, 
  • The oil price is up more than 2%, at US$79 per barrel, the highest in four months, driven by expectations that OPEC+ will extend supply cuts. Investors seem optimistic for the upcoming OPEC meeting in March. 
  • The gold price hit a two-month high as the US dollar weakens, as well as lower Treasury yields and hopes of rate cuts. 
  • While iron ore declined 0.8% to US$117.50 per tonne, the lowest since October, amid the downturn in China’s property market.  
• And there are around a dozen companies going ex-dividend today, including Propel Funeral Partners (ASX:PFP), REA Group (ASX:REA), Steadfast Group (ASX:SDF) and Netwealth Group (ASX:NWL). This often sees share prices fall, as investors take their profits. 

Trading Ideas:

• Bell Potter maintains a buy rating on Neuren Pharmaceuticals (ASX:NEU). The company develop drugs targeting disorders of the Central Nervous System. Bell Potters 12-month price target remains unchanged at $27, following the company’s Q4 update. NEU’s current share price if $19.36, so this implies 39.5% share price growth in the year. 
• And Trading Central has identified a bullish signal in Deterra Royalties (ASX:DRR), indicating that the stock price may rise from the close of $5.06, to the range of $5.65 to $5.80 over 33 days, according to the standard principles of technical analysis. 

As we approach the close of the February 2024 reporting season, 346 companies have shared their results, offering a mixed bag of beats, meets, and misses. While investor sentiment has been volatile, with share prices reacting dramatically to both positive and negative news, brokers have been more cautious, issuing slightly more downgrades than upgrades. So, what were the key themes that emerged during the first half that will shape the second half of the year? 

In this week’s wrap, Grady covers:

• (0:53): why Harvey Norman is rallying despite slowdown
• (1:56): which retailers are winning as consumer spending eases
• (2:18): mixed results for Ramsay Healthcare & ResMed
• (3:50): how commodity prices are keeping miners on edge
• (4:33): key themes that will continue into second half of FY24
• (6:28): the most traded stocks & ETFs by Bell Direct clients
• (7:02): economic data to watch next week.

Wall St closed higher overnight as investors shrugged off unfavourable key inflation data to post gains across the key indices which remain in line for a winning month. The inflation data reading came in the form of US core PCE prices which excludes food and energy increasing by 0.4% from the previous month, while rising at an annual rate of 2.8%, indicating inflation in the world’s largest economy remains sticky. GDP growth data was also released on Wednesday, indicating the US economy grew by 3.2% in Q4 which was slightly less than economists were expecting and well below the 4.9% growth recorded in Q3. The Dow Jones ended Thursday’s trading session 0.15% higher, the S&P 500 gained just over half a percent and the tech-heavy Nasdaq rallied 0.84%.

Over in Europe, markets closed slightly higher as investors reacted to key inflation reports. The STOXX600 closed 0.1% higher with construction stocks leading gains, up 1.2% whilst healthcare and food and beverage stocks both fell 0.7%. Germany’s DAX closed 0.44% higher, the French CAC closed down 0.34% and over in the UK, the FTSE100 ended the trading session 0.07% in the green.

Locally yesterday, the ASX200 closed half a percent higher with all but the utilities sector ending the trading session higher. Real estate and the consumer discretionary sectors lead gains up 1.73% and 1.29% respectively whilst the utilities sector fell 0.33%.

What to watch today: 

• The Australian share market is set to open slightly higher, with the SPI futures suggesting a rise of 0.04% at market open this morning.
• On the commodities front this morning,
  • Oil is trading 0.4% lower at US$78.22 cents a barrel as investors await the OPEC+ meeting in March where discussions will be held on the ongoing output cuts. 
  • Gold is trading 0.47% higher at US$2044 an ounce and iron ore is trading 0.84% lower at US$118.50 a tonne following a decline in home sales in China, consequently lowering margins for steel furnaces, meaning input buying declined. 

Trading Ideas: 

• Bell Potter maintains a buy rating on Electro Optic Systems (ASX:EOS) and has increased its price target from $1.60 to $2.30. The buy rating is maintained following strong CY23 results which saw a return to positive EBITDA earlier than was forecasted. The company is currently experiencing substantial price growth and with a reduced cost base, Bell Potter has upgraded their EBITDA margin forecasts to 6%, 10.5% and 12% in CY24, CY25 and CY26, respectively.
• And Trading Central has identified a bullish signal on Perseus Mining (ASX:PRU), indicating that the stock price may rise from the close of $1.75 to the range of $1.93-$1.97, on a pattern formed over 8 days, according to the standard principles of technical analysis.

Wall St has closed lower for the third straight day as investors await Important inflation data coming out later in the week. The Dow Jones lost 0.06%, the S&P500 dropped 0.17% and the tech-heavy Nasdaq ended the trading session 0.55% lower.

Over in Europe, markets closed lower as cautious investment sentiment continued on from earlier in the week. The STOXX600 closed 0.3% lower with the majority of sectors ending the trading session in the red. Losses were led by technology stocks which lost 1.4%, whilst auto stocks rose by almost 1%. Germany’s DAX gained 0.25%, the French CAC gained 0.08% and over in the UK the FTSE100 closed 0.76% lower.

Locally yesterday, the ASX200 closed 0.03% lower with the consumer staples sector leading losses, down 0.81%. This was offset by the information technology sector which rallied 2.88% by the closing bell. Also yesterday, CPI data for January was released with it staying steady at 3.4%, the same as the previous month, 0.2% lower than the consensus and forecast of 3.6%.

What to watch today: 

• The Australian share market is set to open lower, with the SPI futures suggesting a fall of 0.25% at the open this morning.
• On the commodity front this morning,
  • Oil is trading over half a percent lower at US$78.44 cents a barrel, with the latest EIA report showing a higher-then-expected 4.199 million barrel rise in US crude oil inventories last week. 
  • Gold is trading 0.20% higher at US$2033 an ounce and iron ore is trading flat at US$119.50 cents a tonne. 

Trading Ideas: 

• Bell Potter maintains a buy rating of Cyclopharm (ASX:CYC) and has kept its 12-month price target steady at $3.80. The buy rating is maintained following strong earnings results in which commercial revenue increased by 14%. As well, short term catalysts include the announcement of first patient images from the US and subsequent contract signings of which are at various stages of approval.
• And Trading Central has identified a bullish signal on Abacus Group (ASX:ABG), indicating that the stock price may rise from the close of $1.14 to the range of $1.16-$1.18, on a pattern formed over 19 days, according to the standard principles of technical analysis.