Market Updates

 ASX 200 rallied into the weekend with the index up 17 points to 7155 (+0.2%). For the week, the index fell 1.7% on mainly debt woes, and lack of our own Nvidia. Banks and resources were better today, the Big Bank Basket up to $168.78 (+0.35%) as yields continue to push higher and WBC becomes the latest bank to cancel its cashback offer on home loans. War is over it seems. Insurers doing well on the back of yields rising, even money managers better today. REITs conversely under pressure on higher rates, GMG down 0.6% and MGR off 1.7%. Healthcare in ICU today, CSL down 0.7% with RMD off 1.7% and FPH underwhelming on results falling 6.3%. Tech once again better, WTC continues to push higher despite global growth concerns perhaps, XRO slipped slightly with TNE and ALU both better, and chip wannabes BRN and WBT finding friends today. The All-Tech Index rose another 0.9%. Bit of short covering in retail land, DMP up 2.9%, Travel better CTD up 2.2% and LOV up 1.2%. KGN up 3.3% too. Switching gears to resources and a better day as iron ore stabilised, BHP up 1.4% and FMG bouncing hard up 3.3%. Lithium stocks mixed, SYA tapping investors for another $200m at the same price they did a year ago. Gold miners continue to drift lower and oil and gas stocks down too with coal in not such a merry place.

In corporate news, IVC held its AGM and gave a positive outlook statement, LFS down 3.5% after a profit warning following its cyberattack.
On the economic front, retail sales in April were flat. This follows a 0.4% rise in March. Asian market mixed again and yields up to 3.74%. US Futures drifting ahead of debt talks and a long weekend. Dow Futuires down 44 and Nasdaq down 17.

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Wall Street ended mostly up overnight after Nvidias blowout forecast sent the chipmakers’ share price surging 24%, which fuelled a rally in AI-related companies. S&P 500 gained while the Dow fell for its 5th session, dragged down by Intel shares. Debt ceiling talks failed to reach an agreement, but GOP Rep McHenry said “the list of issues dividing the two camps had grown shorter”, edging closer to a deal. June 1st deadline looming. US treasury yields are up, and the USD reached a two-month high. In contrast, Gold slid to its lowest level in months. European markets broadly lower, as global economic slowdown and US debt ceiling stand-off outweigh optimism. STOXX 600 Index fell 0.3%, losing 2.7% in three consecutive days.

Dow Jones down 35 points (-0.11%). S&P 500 up 0.9%. NASDAQ up 1.7%. VIX Volatility Index down 4.4%. In European markets Stoxx 600 -0.3%, FTSE -0.7%, CAC -0.3%, and DAX -0.3%. SPI Futures are down 6 points (-0.08%).

Nvidia's stock surged 24%, marking one of the largest one-day gains for the U.S. stock, as its revenue forecast highlighted the untapped potential of AI. This surge doubled the company's stock value for the year and propelled its market capitalisation to around US$939bn, inching closer to the trillion-dollar club, making Nvidia the largest chip firm after Apple, Alphabet, Microsoft, and Amazon. The positive earnings report also boosted the chip sector and AI-focused firms, seeing The Philadelphia SE Semiconductor Index up 7% to its highest level in more than a year.

• US corporate profits plummeted by 6.8% in Q1 2023, the lowest since Q2 2021, surpassing market expectations and marking the largest decline since Q1 2020.
• US Bond yields sharply rose. 2Y yields up 19bps. 10Y yields up 10bps.
• Heavyweight tech stocks higher: Apple +0.7%, Meta +1.4%, Google +2.1%, and Microsoft +3.8%.
• Intel Corp -5.5% viewed as lagging in the AI race by the market.
• Ralph Lauren Corp +5.34% after the luxury retailer beat profit expectations.
• Gold reached a two-month low, down 0.85% due to progress in U.S. debt ceiling talks and expectations of a rate hike by the Federal Reserve. The optimism surrounding the debt ceiling negotiations reduced the demand for safe-haven gold.
• Silver also reached its lowest point in two months down 1.4%.
• Zinc fell 2.15% to its lowest level since July 2020 due to weak demand and rising inventories. The economic recovery in China, has been slower than expected pushing prices down.
• Copper +0.67%, Nickel +2.34%, Aluminium +0.27%, Lead +0.71%, Tin +2.02%.
• WTI crude dropped 3.69% and Brent fell 2.79%, ending a three-day period of gains. The decrease came after Russian Deputy Prime Minister stated that OPEC+ would not implement additional production cuts.

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ASX 200 nosedived today, closing down 76 points (-1.1%) to 7138, sliding for the fourth consecutive session as lingering uncertainties weigh on market sentiment. Tech stocks showed off their resilience on the back of the Nvidia result and move, with the All-Tech Index up another 2.4%, recovering yesterday’s losses and then some. XRO found its balance after yesterday's tumble, up 2.3%, SQ2 +2.5%, ALU +4.3%, MP1 +12.1% and NXT +4.4%. Gold miners worst performers today, NST down 3.6%, EVN down 4.4% and NCM off 1.9%. Base Metals and Miners followed suit, with heavyweight iron ore miners down BHP -1.6%, RIO -1.6% and FMG -3.2%. Lithium joined the sell-off, MIN -3.1%, PLS -1.3%, and LKE off 3.6%.Energy stocks weakened, WDS down 0.5% and coal stocks grim, WHC down 4.5% % and NHC off 4.5%. Financials were no better, with the Big Bank Basket down to $168.20 (-2.1%), financial stocks performing more like "fiscal flops" than money-making maestros, CBA down 2.2%, MQG off 2.2%, and ANZ slid 2.6%. Fund managers slipping away, MFG down 1.6%, PPT down 0.4%, and PTM off 2.6%. Industrials mostly down, REITs off 0.5%, Healthcare up, CSL up 0.2% and COH up 0.1%.

In corporate news, ABC rocketed up 21.9%, on AGM and results, WOW -0.1% acquires failed startup milk run, and TWE fell 7.8%% after the group announce its expecting sales to be down 2-3%.

Nothing on the economic front. Looking beyond our borders, Asian markets are down, Japan down 0.3%, HK down 2.4%, with China off 0.9%. Australia 10Y yield up to 3.70%. Dow Jones futures down 68 points and Nasdaq futures up 182 points.

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Global equities fell overnight as US debt ceiling talks continue without a deal. All three major US indices are down just off session lows, extending losses from the prior session. Safe haven buying boosted the dollar and gold. Oil prices have reversed their recent downtrend, rising after a warning from the Saudi energy minister to speculators. Lots of Fed speak following the release of FOMC meeting minutes, a bevy of mixed signals from officials. One-month US bills are hovering near record highs on concerns about impending payments coinciding with the potential risk of the treasury running out of money; meanwhile, 10Y yields retracted. European markets were smashed after a fresh wave of selling, the Europe-wide STOXX 600 index fell 1.8%, logging its worst day in two months.

Dow Jones down 256 points (-0.77%). S&P 500 down 073%. NASDAQ down 0.61%. VIX Volatility Index up 8.1%. In European markets Stoxx 600 -1.8%, FTSE -1.7%, CAC -1.7%, and DAX -1.9%. SPI Futures are down 31 points (-0.43%).

Nvidia is up +25.61% in after-hours trade after exceeding Wall Street estimates by more than 50% in its revenue forecast for Q2. Growth attributed to an increased supply of its AI chips, in high demand for applications like ChatGPT. The company reported a robust performance, with data centre chip sales reaching US$4.28bn and gaming chip revenue exceeding expectations at US$2.24bn, while net income rose to US$2.04bn, reflecting strong financial growth.

HEADLINES

• Australia refers PwC tax document leak scandal to police.
• Australia and India to seek closer economic ties, critical minerals cooperation.
• RBNZ Governor Orr says confident in restrictiveness of interest rates.
• Republicans, White House see progress in US debt ceiling talks.
• Fed agreed need for more rate hikes after May meeting was 'less certain'.
• Ron DeSantis enters 2024 U.S. presidential race.
• Nvidia shares surge 21% as sales forecast jumps and AI booms.
• Stalled US debt talks, inflation woes hit stocks.
• White House says China's actions on Micron won't torpedo relations.
• Airbus rules out the imminent launch of new A220 jet version.
• McCarthy Says GOP and White House ‘Have Time’ to Reach Debt Deal.

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The ASX 200 decided to take a nosedive today, closing down 46 points (-0.6%) to 7214, marking the third consecutive session down as market sentiment sours. Tech rally came to an end. All-Tech Index fell 0.9%. XRO hot streak finally cooled, off 1.5%, SQ2 and CPU found some support up 0.7% and 0.2%. Gold and Energy stocks were the winners today, riding the wave of stronger oil and bullion prices. NCM up 0.6%, PRU up 0.8%, STX rising 4.3%, and STO firmer 1.4%. Mining and Materials decided to dig themselves into a hole today, as prices for base metals took a downward slide. BHP -2.2%, RIO -2.1% and FMG down 4.1%. Lithium stocks are broadly down, MIN down 3.0%, PLS off 1.7%, while AKE in demand up 0.7%. Financials failed to hold onto yesterday’s gains, down 0.2%. CBA is the only major bank in positive territory, up 0.5%, NAB, ANZ, WBC and MQG all down. Healthcare stumbled, CSL down 1.2% and RHC down 0.8%. Insurers mixed, QBE -1.3%, MPL +0.9%, and SUN +0.5%. REITS off 0.9%, while bonds firm.

In corporate news, UNI tanked 23.9%, after flagging subdued trading will persist into next fiscal year, despite on track to deliver record sales, QAN +1.9% on broker updates, and WEB rose 3.8% on positive results, revenue rose 164%.

In economic news, Westpac Melbourne Institute Leading economic index came in flat at 97.27 in April, marginally down from 97.3 in March; the result suggests a continuation of an ongoing economic slowdown. Reserve Bank of New Zealand lifted rates by 25bps today to 5.5%, the highest rate since 2008. UK inflation rate significantly dropped to 8.7% in April from 10.1% in March. Core inflation still a problem. Asian markets are down, Japan down 0.4%, HK down 1.1% with China off 0.7%. Australia 10Y yield up to 3.66%. Dow Jones futures down 2 points, and Nasdaq futures down 7 points.

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ASX 200closed down 3 points to 7260 (-0.1%) in a narrow day of trade. Financials bounce back, recovering yesterday’s losses. The Big Bank Basket up to $171.34 (+0.6%) MQG, the biggest winner climbing 2.1%, CBA, NAB, ANZ, and WBC all with modest gains +0.6%, +0.4%, +0.8%, and +1.0% respectively. Tech Rally continues, All-Tech Index gained another 0.3%. WTC had a wild day, shares hit a record high of $74.46 today, making WTC the largest listed software company on the ASX before closing down 0.1%, SQ2 gained 4.5%, and XRO up 0.9%, marking the fifth day of consecutive gains. REITS found support, GMG up 0.7%, SCG up 0.4% and MGR stronger 0.9%. Energy stocks did well again today, as oil firms and demand outlook improves, WDS +0.3%, STO +0.3%, and BPT +0.4%. Base metals and Resources were broadly lower, S32 down 0.5%, BHP down 0.9% and FMG off 0.5%. Lithium stocks were mostly down, MIN -1.0%, PLS -0.8%, but AKE rose 0.8%. Travel stocks were hammered, QAN -2.2% triggered a broad sector sell-off, despite forecasting a record underlying pre-tax profit in FY23. Healthcare and Insurers mixed. CSL +0.6%, SHL -3.0%, QBE +1.4%, while NHF fell 0.8%. Gold sector down for the sixth day in a row, falling 1.2%, NCM -1.9%, NST -0.8%, and EVN off 1.3%.

In corporate news, NAB lifts mortgage rates up 0.1% on new home loan customers, 29M  fell 3.3% on updates to guidance, and OFX surged +20.1% on record results, NOI up 45.6%. In economic news, Judo Bank PMI data out today, the manufacturing PMI reached an eight-month high of 50.8 in May, the services PMI down to 51.8 in May, fell from 53.7 last month, and the Australia Composite PMI was above 50, coming in at 51.2 in May falling from 53 in April.

Asian markets eased with Japan down 0.7%, HK down 0.7%, with China off 0.9%. Australia 10Y yield up to 3.65%. Dow Jones futures up 26 points and Nasdaq futures up 27 points.

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US stocks closed mostly higher in an uneventful day of trade. The Dow closed 140 points lower, the S&P 500 near flat, finishing just in the green ending off session highs just under the 4200 level, and the NASDAQ added 0.5%, supported by gains in Alphabet and Meta. European stocks finished little changed. Gold come under pressure from Hawkish Fed officials, Treasury yields weaker 2Y yield back above 4.3%, USD stronger and shares in PacWest Bancorp surged by almost a fifth +19.55% on news it has agreed to sell a portfolio of 74 real estate construction loans to a subsidiary.

Dow Jones down 140 points (-0.42%). S&P 500 up 0.02%. NASDAQ up 0.50%. VIX Volatility Index up 3.1%. In European markets Stoxx 600 -0.01%, FTSE +0.18%, CAC -0.18%, and DAX -0.32%.

SPI Futures are up 5 points

• Wall Street mixed, European stocks flat as US debt ceiling talks progress.
• Clock ticking, 'optimistic' Biden and McCarthy meet on debt ceiling.
• TikTok sues Montana after state bans app.
• Inflation has eroded U.S. households' financial security, Fed survey shows.
• Ford seeks to reassure investors with EV, cost cut plans.
• PacWest shares jump after $2.6 bln real estate loan sale.
• Investors on Wall Street turn to tech stocks.
• Macquarie flags credit crunch risk from tight lending conditions.
• Meta Fined Record €1.2 Billion in EU Over US Data Transfers.

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ASX 200 started the week down 16 points to 7263 (-0.2%) tracking the US markets as debt ceiling jitters continue. Banks weighed down the ASX today, Big Bank Basket fell to $170.32 (-0.9%), CBA the biggest loser down 1%, ANZ, NAB, and WBC all off -0.8%, -0.7%, and -0.8% respectively. Tech continued to rally, with the All-Tech index up 0.2%, XRO continued to climb up another 1.3%, after gaining 15% last week, WTC up 1.9%, ALU up 1.4%, and NXT gained1%. Energy sector performed well up 1% thanks to a surge in oil imports in China, which has almost hit a decade high, WDS, STO, and BPT all gained over 1%. Lithium stocks took a beating, AKE and PLS hammered, down 3.1% and 2.8% respectively. Gold miners eased, NST down 0.8% and NCM fell 0.3% Industrials were underwhelming. WOW off 0.4%, WES down 1%, and TLS slipped 0.6%. Healthcare and Insurers in positive territory, CSL +0.7% RMD +0.7%, QBE +1.2%, and SUN gained 0.9%. REITS slipping off 0.8%, GMG down 0.8% and VCX also down 2.7%.

In corporate news, GTK surged 29.1% on results, specifically a 47% jump in sales. In contrast CCX fell 5.8% on a decline in sales. TYR plunged 16.1% after Potentia pulled its takeover offer.

Nothing on the economic front. Asian markets are higher, Japan up 0.7% and HK up 1.3% with China stronger +0.1%. Australia 10Y yield  3.58%. Bitcoin up 0.88%. Dow Jones futures down 34 points and Nasdaq futures up 5 points.

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Dow Jones down 109 points (-0.33%). Up 117 at best, down 199 at worst. NASDAQ -0.24%. S&P 500 -0.14%.

SPI Futures down 11 points. The ASX 200 was up 0.31% (23 points) last week.

US markets rose last week with the Dow Jones up 0.38% on the week, S&P 500 up 1.65% with the NASDAQ up 3.04%, defying Powell and his Hawks last week. The ASX followed suit tracking the US markets up 0.31% supported by tech stocks with XRO outperforming closing the week out up 15.09%.

• Copper rebounded 1.11% on optimism about US debt talks and a weaker dollar on Friday.
• Gold rallied 0.89% as renewed worries about the stability of the banking sector and remarks from the US Federal Reserve chairman prompted traders to slash bets for another interest rate hike.
• Nickel +2.06%, Aluminium -0.18%, Zinc +1%, Lead 1.8%, Tin 1.6%.
• WTI crude fell 0.35% on Friday due to concerns over a potential US debt default, but still recorded a 1.7% weekly gain as the market anticipate an oil market deficit in the second half of the year.

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The ASX 200 took a hit today, dropping 36 points (-0.5%) to close at 7199. The downturn was widespread, with gold and resources the worst performers. Gold miners saw a substantial drop, losing its lustre following recent hawkish comments from Fed officials. NCM down 2.1%, EVN down 2.3%, and NST off 1.1%. Resource stocks faced headwinds, BHP down 0.8% and RIO down 0.3%. Lithium shares also under pressure despite higher carbonate prices, MIN down 1.7%, SYA off 4.4%, and LTR slipped 1.8%. The financial sector struggled, with the Big Bank Basket dipping to $167.83 (-0.5%), led by MQG, which experienced a sharp decline of 1.3%. NAB and CBA also faced selling pressure, slipping 1.0% and 0.5%, respectively. Technology stocks were the winners today, reversing yesterday’s losses, with WTC gaining 1.0%, XRO up 1.9%, and ALU up 1.0%. The All-Tech Index up 0.3%. REITS down as wage data increases the likelihood of another rate rise from the RBA. GMG down 0.9%, and CHC down 0.4%. Defensive sectors no better, Healthcare and Industrials down. WES eased 1.1%, RMD down 0.9%, and MPL tumbled 0.9%. In corporate news, CTT rallied 13.2% after the company confirmed the company founder and CEO Mintz does not have any intention to sell shares in the company at the current time, putting the rumours to rest. TPW +19.1% on positive results in their trading update. IPL off 7.8% after reporting net profit down 6% in 1H23. In economic news, Australian private sector wages up 0.8% in Q1, leading to an annual growth rate of 3.8%, the highest since June 2012. Japan’s economy grew 0.4% QoQ in Q1, exceeding expectations of 0.1%. In Asia, markets are mixed, Japan up 0.3%, HK down 1.0%, and China down 0.6%. Australia 10Y yields gained to 3.43%. Dow Jones futures up 20 points and Nasdaq futures up 26 points.

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