US equities rose overnight supported by stronger-than-expected retail sales data which reinforced the view the Fed is approaching its easing cycle. The Dow Jones hit an all-time closing high for a second consecutive session, rising 743 points (+1.85%) its strongest performance since June 2023. The S&P 500 rose 0.64% to 5,667, its 38th record high this year, and the NASDAQ gained 0.20%. The rotation into small caps continues, Russell 2000 advanced 3.50%, recording its biggest five-day rally since 2020. The Russell 2000 has beaten the NASDAQ 100 by almost 12 percentage points over the last four sessions, a feat not seen since 2011. US retail sales in June remained unchanged, signalling consumer resilience and bolstering economic growth prospects for the second quarter. Treasury yields fell across the board. The 10Y yield fell 7.2bps at 4.16% a four-month low, and the 2Y yield eased 3.8bps on expectations that the Fed is getting close to cut rates. CME FedWatch tool indicates a 91.7% probability for a September rate cut.

ASX to rise. SPI Futures up 55 points (+0.69%).

COMMODITIES

• Gold sprints to all-time high as Fed rate-cut hopes boost demand.
• Iron ore slips, investors eye stimulus signal from key China meeting.
• Oil prices decline over 1% on Chinese demand jitters.
• Aluminium hits three-month low on heavy supply while copper also slips.
• Rio Tinto hails another step closer to develop Serbian lithium mine.
• Miner Barrick's quarterly gold and copper output edges higher.

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