Strength across US and European markets will likely translate into a strong start to trading on the ASX today, with futures pointing to a 0.5% or 38-point lift.
US inflation lifted 2.7% in November, closing in on the Federal Reserve’s 2% goal and raising hopes of another rate cut next week. European markets are also watching for the European Central Bank’s rate decision later today.
US and European markets
The Nasdaq moved above 20,000 points for the first time to a new all-time high in overnight trading, pushing tech and growth stocks higher.
Alphabet (NASDAQ:GOOGL) lifted 5.5%, Tesla (NASDAQ:TSLA) 5.9% to intra-day all-time highs that didn’t quite stick at closing. Nvidia gained 3.1% and Broadcom (NASDAQ:AVGO) 6.6% after the latter was reported to be working with Apple (NASDAQ:AAPL) on a server chip designed for artificial intelligence.
As the UnitedHealth (NYSE:UNH) drama continues to unfold, the company’s stock price took a 5.6% hit as investors considered potential changes to the insurer’s business models.
The Dow was weighed down by the insurance stock’s weakness, falling 0.2% or 99 points.
The Nasdaq lifted 1.8% or 348 points and the S&P500 0.8%.
In Europe, aerospace and defence sector stocks outperformed their peers, lifting 1.4% as rising global geopolitical conflict offered a stark spotlight.
The European Central Bank is expected to cut rates by 25 basis points – investors await that decision, while also monitoring the fallout of Ukraine’s strikes on Russia with US-made missiles.
The FTSE300 lifted 0.3% and the UK FTSE100 followed with another 0.3% lift.
Currencies and commodities
The US dollar had a mixed day of trading.
The greenback fell against the Euro, which moved from US$1.0536 to near US$1.0495, while the Aussie gained from US$0.6336 to near US$0.6370.
The Yen fell, slipping from JPY151.32 per US dollar to near JPY152.55 at the US close.
Global oil prices lifted after the European Union introduced new sanctions impacting Russian oil flows. Brent crude rose by US$1.33 to US$73.52 per barrel, and US Nymex crude added US$1.70 to US$70.29 per barrel. US crude inventories fell by 1.4 million barrels to 422 million barrels, exceeding expectations for a 901,000-barrel draw.
Base metal prices were mixed, with copper futures down 0.2% and aluminium futures up 0.7%.
Gold futures rose by US$38.30 to US$2,756.70 per ounce after inflation data met expectations, increasing speculation of a US Federal Reserve rate cut.
Spot gold traded near US$2,716 per ounce at the US close.
Iron ore futures fell by US$0.11 to US$105.52 per tonne, retreating from a two-month high due to weaker seasonal steel demand and tempered optimism over potential stimulus in China.
On the small cap front
The ASX Small Ordinaries index fell 0.14% or 4.5 points yesterday, outperforming the ASX200’s 0.5% drop.
You can read about the following and more throughout the day.
Helix Resources Ltd (ASX:HLX) has identified large-scale gold extensions at the Muriel Tank Gold Project, with a 3-kilometre-long gold-in-soil strike and rock chip samples up to 17.92 g/t gold.
Great Boulder Resources Ltd (ASX:GBR) has discovered a new high-grade area of gold mineralisation at the Mulga Bill prospect, part of the Side Well Gold Project, with drilling results up to 29 metres at 3.15 g/t gold, including 8 metres at 6.03 g/t gold from 91 metres.
Orthocell Ltd (ASX:OCC, OTC:ORHHF) has passed a major commercial milestone with the first sales of its Remplir nerve repair product in Singapore, its third major market.