ASX futures were up 8 points or 0.09% at 8:30 am AEST, after choppy price action overnight led major US benchmarks to finish broadly higher as the Federal Reserve held rates steady.
The ASX 200 finished 26 points (0.33%) higher yesterday, at 8,178, snapping a two-day losing stream. Potential positive developments in US trade relations with China, as well as a strong earnings report from National Australia Bank Ltd (NAB), supported gains, led by the energy, consumer discretionary and real estate sectors.
Energy and uranium sectors shine locally
The energy and uranium sectors have emerged as areas of interest for small-cap investors. Energy stocks received a boost from a 3.43% rise in oil prices, driven by geopolitical tensions and increased demand from Chinese buyers post-holiday. Notably, Viva Energy jumped 2.8% to $1.84, Ampol rose 2.77% to $25.64, Santos advanced 2.04% to $6.00, and Beach Energy climbed 1.7% to $1.20.
Uranium stocks experienced significant gains following reports that the White House plans to expedite the deployment of small modular reactors (SMRs).
Boss energy jumped 12.43% to $3.98, Silex Systems gained 10.37% to $2.98, Deep Yellow increased 7.6% to $1.27 and Bannerman Energy rose 6.3% to $2.70.
NAB leads financial sector with strong earnings
NAB reported first-half 2025 cash earnings of $3.58 million, about 3% above expectations, with shares gaining 1.61% to $35.78. Its net interest margin decreased slightly to 1.7% from 1.72% year-on-year, with an interim dividend of 85 cents, matching expectations.
ANZ rose 0.47% to $29.98 ahead of its earnings report this morning, while Westpac fell 0.06% to $31.79 and Commonwealth Bank of Australia declined by 0.47% to $165.96.
Fed’s stance and trade talks
Overnight, the Federal Reserve kept the federal funds rate unchanged at 4.25-4.5%, as expected. Chair Jerome Powell’s remarks were interpreted as hawkish, emphasising the need for patience due to the uncertain economic outlook and the importance of maintaining well-anchored long-term inflation expectations.
Reports of upcoming US-China trade talks in Switzerland also gave markets a positive signal, suggesting a potential de-escalation of trade tensions.
Volatile trading in the US
Major US indices closed higher amid volatile trading, with the S&P rising 0.43% to 5,631, the Dow jones gaining 0.70% to 41,114 and the Nasdaq Composite added 0.27% to 17,738.
Investors reacted to multiple catalysts, including the Fed’s rate decision, trade talk reports and the potential rollback of chip export restrictions.
However, optimism was tempered by a significant drop in Alphabet shares, which fell 7.5%, representing $150 billion market in capitalisation. Concerns over declining Google search volumes and Apple’s exploration of AI search integration prompted the drop.
Meanwhile, Bank of America said investors pulled US$8.9 billion out of US equities in the week ending April 30, moving US$7.8 billion into foreign stocks.
Commodities and currency
Currencies were mixed against the US dollar, with the euro decreasing to US$1.1292 from US$1.1376 and near US$1.13 at the close of US markets.
Meanwhile, the Australian dollar weakened by 1.02% against the US dollar, trading at 0.6426.
In commodities, gold prices fell 0.94% to $3,3368.88 per ounce, copper dropped 3.58% to $4.578 per pound and WTI crude oil decreased 1.73% to $58.07 per barrel.
Nickel increased by 0.97% to $15,435 per tonne, indicating a modest uptick in market activity
Zinc rose by 0.54% to %2,584 per tonne, suggesting a slight recover in the base metals sector
Iron ore decreased by 0.56% to $104.81 per tonne amid ongoing concerns about Chinese steel demand
What about small caps?
The S&P/ASX Small Ordinaries gained 0.18% to finish at 3,148.60 yesterday. Over the last five days, it has gained 2.62%.
The RIU Sydney Resources Round Up finishes today, but there has been some news flow this morning and you can read about the following and more throughout the day.
- Sunstone Metals Ltd has reported strong assay results from recent geological mapping and rock chip sampling at its Bramaderos Project in southern Ecuador. Managing Director Patrick Duffy stated that the results further highlight the potential for higher-grade gold mineralisation, particularly in the vicinity of the Limon gold-silver deposit.
- Titan Minerals Ltd has provided an update on its Linderos Copper Project, currently being advanced by Hanrine Ecuadorian Exploration and Mining S.A., a subsidiary of Hancock Prospecting Pty Ltd, under a Joint Venture & Earn-in Agreement.
- American Rare Earths Ltd announced results from a mapping and channel sampling program at the Cowboy State Mine area, part of its Halleck Creek Rare Earths Project in Wyoming. A total of 106 samples were collected across Red Mountain by Wyoming Rare (USA) Inc., ARR’s wholly owned subsidiary, with technical support from Geosyntec.
- Riversgold Ltd has completed a site visit to its Wodgina East project (tenement E45/6363), located adjacent to the Wodgina Lithium Mine in Western Australia's Pilbara region, approximately 120 km south of Port Hedland.
Looking ahead
Australian investors will monitor updates from ANZ, Light & Wonder and Orica, among others.
With the Fed maintaining a cautious approach and global trade dynamics evolving, market participants will closely watch for further economic indicators and corporate earnings to gauge the market’s direction.