Australian shares are set for a bounce this morning, mirroring the sustained rally in the US that seemed to defy the Federal Reserve’s recent remarks challenging expectations of rate adjustments.
ASX futures point to a modest opening gain of 0.1%, a rebound from Monday's 0.2% dip, with the index potentially marking a 5.5% increase for 2023.
Wall Street's performance saw the Dow Jones remain steady, while the S&P 500 and Nasdaq gained 0.5% and 0.6% respectively.
Apple faced a sales halt for its Series 9 and Ultra 2 smartwatches in the US amid a patent dispute with Masimo, negatively impacting shares.
The broader market was buoyed by strong performances from tech giants like Meta Platforms and Amazon.
US Steel marked a big shift in the sector, agreeing to be acquired by Japan’s Nippon Steel for $US14.1 billion.
In Europe, we saw the FTSE rise by 0.5% to 7,614 points, while EuroStoxx lost 0.3% to close at 475 points.
Mixed signals from the Fed
Investor sentiment is currently mixed due to conflicting signals from the US Federal Reserve. Cleveland Fed president Loretta Mester emphasised the continuation of restrictive monetary policies, contrasting with New York Fed president John Williams’ view that it's premature to discuss rate cuts.
Oil prices are witnessing a surge following increased Red Sea tensions due to Houthi militant attacks, leading to temporary transit halts by BP and other shipping firms.
The Australian dollar has hit a five-month high of US67.35¢, although it remains on a year-end downward trajectory.
Key events to watch include the release of the Reserve Bank of Australia's board meeting minutes, which might offer insights into the central bank's rate strategy, and the Bank of Japan's policy decision, which is likely to influence market dynamics.
Currencies and commodities
- Australian dollar: +0.1% to 67.00 US cents
- Spot gold: +0.4% to $US2,026/ounce
- Brent crude: +2% to $US78.07/barrel
- Iron ore: -1.1% to $US132.45/tonne
- Bitcoin: -0.7% to $US41,930
- US 10-year bond: 3.95%
What’s happening in small caps?
The S&P/ASX Small Ordinaries closed at 2,870.63 yesterday, up 0.38% on the previous day.
Making news this morning, which you can read more about throughout the day with Proactive:
- Sunstone Metals Ltd (ASX:STM) says it has received outstanding high-grade gold exploration results around 1 kilometre away from the Limon Central Shoot, but still within the Limon epithermal discovery, at its Bramaderos project in southern Ecuador.
- Novo Resources Corp (TSX:NVO, OTCQX:NSRPF, ASX:NVO) has entered into a sale, joint venture and coordination agreement with SQM (NYSE:SQM) Australia Pty Ltd, a subsidiary of Sociedad Química y Minera de Chile, in relation to five of Novo’s prospective lithium and nickel exploration tenements in the West Pilbara.
- Miramar Resources Ltd (ASX:M2R) says a review of historical drilling data has revealed potentially very significant magnetite iron opportunities at the company’s Whaleshark Project in the Ashburton Region of WA.
- Alligator Energy Ltd (ASX:AGE, OTC:ALGEF) has announced the results of its maiden RC drilling at the 100% owned Nabarlek North Project (EL31480) in the Alligator Rivers Uranium Province.