After its third consecutive gain on Tuesday, the ASX is again set to open higher this morning with the ASX futures up 13 points to 7,498 near 9am AEDT.
Strength in the Australian market is following the lead of the US, where the S&P 500 delivered its third consecutive record high overnight — and its longest winning streak since December.
Expectations of lower interest rates, alongside optimism around artificial intelligence are fueling the rally in US stocks. While the Dow Jones lost 96 points or 0.3%, the S&P 500 index gained 0.3% to a fresh all-time high and the Nasdaq index added 66 points or 0.4%.
After the US close, Netflix (NASDAQ:NFLX) reported record subscriber gains, smashing Wall Street subscriber estimates as it logged its largest fourth-quarter subscriber growth ever. Netflix was up 6% in after-hours trade.
What happened overnight?
Here’s what we saw (source Commsec):
US markets
The mixed US markets came as investors assessed the latest earnings results.
Shares in 3M (NYSE:MMM) fell 11.0% after providing disappointing earnings guidance. Johnson & Johnson (NYSE:JNJ) fell 1.6% even despite quarterly results beating expectations. D.R. Horton lost 9.2% as the homebuilder missed estimates for the first quarter. Shares in General Electric (NYSE:GE) fell 1.0% after the engine maker disappointed with earnings guidance.
But shares in Verizon Communications (NYSE:VZ) rose 6.7% after the telecommunications giant posted a sharp lift in subscriber additions. Procter & Gamble (NYSE:PG) gained 4.1% as second-quarter profits beat forecasts. And shares in United Airlines rose 5.3% after reporting strong fourth-quarter earnings.
European markets
European sharemarkets were mixed on Tuesday. The continent-wide FTSEurofirst 300 index lost 0.3%. In London, the UK FTSE 100 index was flat.
Utilities fell 0.8%, real estate lost 1.3% and healthcare lost 0.9%, but miners rose on hopes for economic stimulus in China.
Bloomberg reported that China is set to announce a near US$280 billion package to support the sharemarket. China-exposed luxury firms including LVMH, Kering (EPA:PRTP) and Richemont were up between 1.1% and 1.7%. Shares in Volkswagen (ETR:VOWG_p) rose 5.4% after a positive meeting with analysts.
Commodities
Global oil prices fell about 1% on Tuesday.
- The Brent crude price fell by US51 cents or 0.6% to US$79.55 a barrel.
- The US Nymex crude price fell by US82 cents or 1.1% to $74.37 a barrel.
Reports of a US$280 billion stimulus package in China were assessed alongside news earlier in the week of the re-opening of the El Sharara oilfield in Libya and disruptions to US oil production in North Dakota.
Base metal prices were firmer on Tuesday, lifting between 0.7- 3.7%.
- Copper futures rose by 0.7%.
- Aluminium futures lifted 2.7%.
Currencies
Currencies were weaker against the US dollar in European and US trade.
- The Euro fell from US$1.0914 to US$1.0820 and was near US$1.0845 in late US trade.
- The Aussie dollar eased from US66.10 cents to US65.50 cents and was near US65.70 cents in late US trade.
- The Japanese yen eased from 146.96 yen per US dollar to JPY148.69 and was near JPY148.35 in late US trade.
On Tuesday, the gold futures price rose by US$3.60 or 0.2% to US$2,025.80 an ounce. Spot gold was trading near US$2,028 an ounce in late US trade.
Iron ore futures rose US6 cents to US$135.48 a tonne.
What’s on today?
In Australia, purchasing managers' indexes (PMIs) are scheduled with the leading index. Northern Star Resources (ASX:NST), Perseus Mining, Pilbara Minerals, St Barbara and Woodside Energy all release quarterly production updates.
On the small cap front
The S&P ASX Small Ordinaries gained 0.51% yesterday, while the ASX 200 ended 0.34% higher.
You can read more about the following throughout the day.
- Lightning Minerals Ltd (ASX:L1M) has commenced an aircore drilling of up to 7,500 metres testing for pegmatites and lithium mineralisation 8-kilometres east of Liontown Resources (ASX:ASX:LTR)’ Buldania project in the Dundas region of Western Australia.
- Hot Chili Ltd (ASX:HCH, TSX-V:HCH, OTCQX:HHLKF) has kicked off the next phase of its 30,000-metre resource growth-focused drill program, testing multiple resource growth opportunities at the Costa Fuego Copper-Gold Project in Chile.
- Radiopharm Theranostics Ltd (ASX:RAD, OTC:RDPTF) has received commitments of around A$1.7 million for the shortfall under its recent entitlement offer in which it raised around A$2.1 million.