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The morning catch up: ASX to edge higher after Dow hits new high

Published 26/11/2024, 09:35 am
© Reuters.  The morning catch up: ASX to edge higher after Dow hits new high
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The Australian sharemarket is set to edge higher this morning, with futures pointing to a rise of 18 points, or 0.2%, at the open.

US markets started the Thanksgiving holiday-shortened week with gains — the Dow Jones rose by 440 points or 1% to a new record high, while the S&P 500 gained 0.3% and the Nasdaq index added 51 points or 0.3%.

The broader US equity market rose for a sixth consecutive session, while small caps hit a record high on enthusiasm over Scott Bessent being named US President Trump's treasury secretary. The Russell 2000 index of smaller stocks jumped 1.5%.

Hedge fund manager Bessent is seen by financial markets as a gradualist in relation to applying proposed Trump policies, particularly where tariffs and trade are concerned.

  • Company movers included department store operator Macy’s Inc. whose shares fell 4% after revealing that an employee concealed $100 million in expenses.
  • Super Micro Computer shares rose almost 13%, having surged 78% last week, on hopes the server maker will remain listed on the Nasdaq.
  • Bath and Body Works shares rose 15% after the body care products maker reported better-than-expected earnings and raised its full-year guidance.
  • The two largest homebuilders in the United States, Lennar (NYSE:LEN) and D.R. Horten, each rose by around 5%, aided by a steep drop in long-term bond yields.

European markets also rose overnight, adding to the gains of the end of last week, after the ECB’s chief economist said the Central Bank 'should be able to lower official interest rates to levels that no longer restrict activity'.

The latest figures in Europe continued to paint a picture of an economy challenged by headwinds.

The influential German IFO Survey saw its Business Climate Indicator fall more than expected in November, down from 86.5 to 85.7, with reports from survey contributors highlighting a 'weak German economy' and 'concerns around trade'.

Currencies

Currencies were stronger against the US dollar in European and US trade.

  • The Euro rose from as low as US$1.0429 to US$1.0530 and was near US$1.0495 in late US trade.
  • The Aussie dollar slid from a high of US65.50 cents to US64.87 cents and was near US65.01 cents in late US trade.
  • The Japanese yen eased from 154.72 yen per US dollar to JPY153.55 and was near JPY154.16 in late US trade.

Commodities

Global oil prices fell on Monday as the prospect of a Middle East ceasefire weighed on prices. There are reports that Israel and Lebanon have agreed to the terms of a deal to end the Israel-Hezbollah conflict.

  • The Brent crude price fell $2.09 or 2.8% to US$73.08 a barrel.
  • The US Nymex crude price slumped US$2.18 or 3.1% to US$69.05 a barrel.

Base metal prices firmed on Monday, benefitting from a moderation in the recent rally in the US Dollar.

  • Copper futures rose 0.4%.
  • Aluminium futures improved 1%.

The gold futures price slumped US$83.20 or 3.1% to US$2,628.20 an ounce on Monday as safe haven demand eased. Spot gold was trading near US$2,625 an ounce in late US trade.

Iron ore futures firmed slightly, up US7 cents or 0.1% to US$102.01 a tonne on Monday.

What’s on today?

In Australia, Webjet Group releases earnings. Brickworks, Pilbara Minerals and Ramsay Healthcare all host AGMs.

In the US, the minutes of the Federal Reserve Open Market Committee (FOMC) November meeting are issued. Data on home prices, consumer confidence, manufacturing, and new home sales are all scheduled.

What’s happening in small caps?

  • Titan Minerals Ltd (ASX:TTM, OTC:TTTNF) has executed a formal binding joint venture and earn-in agreement with Hancock Prospecting subsidiary Hanrine, while a 10,000-metre diamond drilling campaign is underway with a second rig set to commence in the coming weeks.
  • Recce Pharmaceuticals Ltd (ASX:RCE, OTC:RECEF) reports the Australian Patent Office has formally granted Patent Family 3 for Recce’s Anti-infectives, meaning they are now patent-protected in all major pharmaceutical markets globally.
  • Polymetals Resources Ltd (ASX:POL) has completed its compilation of the +50 years of historic exploration data for its Endeavor Project in the Cobar Basin NSW — the first time a comprehensive database has been consolidated over the area.
  • Riversgold Ltd (ASX:RGL) has received the final batch of assay results from November aircore drilling undertaken during its fourth aircore program at the Northern Zone Intrusive Hosted Gold Project in WA. Significant intercepts include 8 metres at 4.86 g/t gold from 34 metres.
  • American Rare Earths Ltd (ASX:ARR, OTCQB:ARRNF) has received final assay results from its 2024 drilling campaign at the Cowboy State Mine area within the Halleck Creek Project, Wyoming, confirming some of the highest-grade total rare earth oxide (TREO) intersections recorded.
  • Read more on Proactive Investors AU

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