Strength in US tech stocks drove Wall Street higher overnight, despite a higher-than-hoped lift in core inflation data, rising 0.2% in August.
The numbers match analyst survey expectations, but the market was hoping weak numbers would prompt a 50-basis-point interest rate cut from the Fed this month, rather than the hotly anticipated 25 bp cut currently on the cards.
ASX Futures indicate a 0.26% or 21-point gain in early morning trading, as of 9:00 am this morning.
US and European markets
Artificial intelligence golden child Nvidia lifted 8.2% on reports the US government is considering allowing advanced chip exports to Saudi Arabia.
Google (NASDAQ:GOOGL) also lifted 1.43%, Microsoft (NASDAQ:MSFT) 2.13% and Apple (NASDAQ:AAPL) 1.16% and Meta 1.39%.
Word from Chinese lithium processing giant CATL that it was adjusting lithium carbonate production operations in Yichun gave lithium stocks a much-needed boost.
Albemarle jumped 13.6%, Sigma Lithium (TSXV:SGML) 12.75%, Patriot Battery Metals 12.99% and Standard Lithium 15.32%.
Reactions to the US presidential debate last night have been mixed, but opinion seems to be coming down mostly on Kamala Harris’ side. Solar stocks lifted in response, benefiting from greater confidence investment in green energy will continue under another Democratic President.
First Solar (NASDAQ:FSLR) lifted 15.2%, Enphase Energy Inc (NASDAQ:ENPH, ETR:E0P) 5.72%, Sunrun Ince 11.34% and SolarEdge Technologies Inc 8.46%.
The Dow Jones gained 0.3% or 125 points despite falling 744 points in earlier trading, the first time since October 2022 the bourse has erased an intraday loss of 1.5%.
The Nasdaq gained 2.2% or 370 points and the S&P500 lifted 1.1%.
European markets were mixed – US inflation data weighed on investors’ minds. Retail stocks lifted 1.5%, but the real estate dragged indexes down, falling 0.8%.
The FTSE300 managed a 0.1% lift, and the UK FTSE100 shed 0.2%.
Currencies and commodities
The Euro and Yen fell against the US dollar overnight, but the Aussie lifted.
The Euro fell from US$1.1054 to US$1.1015, the Yen from 141.15 per US dollar to 142.30 yen and the Aussie lifted from US$0.6621 to US$0.6675 by the end of the session.
Oil prices rose after weeks of downward price pressure, as Hurricane Francine closed down 25% of US Gulf of Mexico oil production, lifting oil prices more than 2%.
US crude inventories increased by 833,000 barrels, below the forecasted rise of 987,000 barrels.
Brent crude increased by US$1.42 (2.1%) to US$70.61 per barrel, while US Nymex crude gained US$1.56 (2.4%) to US$67.31 per barrel.
Base metals lifted on a weaker US dollar; copper gained 1.1% and aluminium 1.8%. Iron ore futures rebounded slightly, lifting by US$1.02 (1.1%) to US$92.30 per tonne, driven by stronger exports and reduced supply in China.
Gold futures fell by US$0.70 to US$2,542.40 per ounce as US CPI data dashed hopes of an out-sized rate cut.
On the small cap front
The ASX Small Ordinaries lifted by 5.9 points or 0.20% yesterday, handily outperforming the ASX’s 0.41% drop.
You can read about the following and more throughout the day on our website.