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11 July Markets at a glance

It’s green on screen for the ASX on this Thursday session ahead of crucial inflation data in the US. Miners and financials are driving the gains while the AUD is standing tall against the kiwi, and at a 33-year peak against the struggling yen. Stock specific, JB-Hi-Fi is in focus as the ACCC launches proceedings against the Good Guys. On the global stage, it's rally on as markets from Tokyo to New York mint fresh record highs.

Around the grounds

  • ASX rebounds from yesterday’s sell-off
  • Gold & oil rise
  • Iron ore rebounds but headwinds remain
  • AUD nears 20-month high against NZD
  • USD drifts ahead of inflation test

The Australian share market has recovered from yesterday’s sell-off in a broad-based rally as heavyweight miners and banks gain and traders assume the brace position for crucial U.S. inflation data tonight. Energy, healthcare, and info tech are all higher.

In the commodity complex, both gold and oil are on the rise while iron ore futures are tracking higher on mounting speculation top consumer China will unveil more stimulus measures in its third plenum after disappointing inflation data released yesterday.

NZ shares are also gaining ground, to touch their highest level since June 5, a day after the RBNZ held its official cash rate steady but left the door wide open for possible rate cuts soon. Markets are implying a 50% chance the New Zealand central bank could start easing at their next policy meeting in August.

Globally, investors are eying that US inflation print, a favourable consumer price index would bolster chances of a rate cut by the Fed, more on that later.  

In the news

Woodside Energy (WDS) is in focus, after inking a deal to supply LNG to Taiwan for a period of 10 years. Under the deal Woodside will deliver 6 million tonnes of LNG over the period starting from July, sourced from WDS’s global portfolio.

Meanwhile, WA1 Resources (WA1) shares have taken a nosedive on a discounted placement. The diversified miner says it has received firm commitments to raise AU$60 million via a share placement, but at an issue price of AU$17 a share, which is at a near 10% discount to the last closing price on July 9.

Shares are up over 50% this year as of last close.

In the broker space, Australian listed shares of Evolution Mining (EVN) are tracking higher as Jarden raises its price target on the gold miner to AU$3.15 from AU$2.84 per share. ‘Underweight’ rating retained, and the stock is down nearly 6% YTD, as of last close.

Meantime, the competition watch dog has been busy today. JB Hi-Fi (JBH) has confirmed the ACCC has launched proceedings against the Good Guys relating to advertising and fulfilment of certain store credit promotions between July 2019 and August 2023. This as the body flags preliminary competition concerns with Aurizon holdings (AZJ) proposed buyout of Flinders Logistics.

Finally, across the ditch shares of New Zealand listed Synlait Milk (SML) have spiked, set for their best day ever if current gains hold as shareholder a2 Milk (A2M) says it will vote in favour of the company’s entry into an NZ$130 million shareholder loan with China-based Bright Dairy, currently Synlait’s largest shareholder.

Going global

Lets get across the FX moves. The US dollar has drifted a touch lower, with most global currencies trading sideways ahead of that key U.S. inflation report tonight. Forecasts are for core inflation to have risen 0.2% in June, taking the annual rate to 3.4%.

Against the greenback, the euro has edged higher, while the Australian dollar is relatively flat at 67.54 US cents.

Sterling has firmed a little on receding expectations for an August rate cut from the Bank of England (BoE) after comments form central bank policy makers caused markets to scale back bets for an easing cycle to begin next month.

Finally, the yen continues to hover near that 38-year low, with investor focus now fixed to the BOJ’s plan on how it will begin to taper its mammoth bond buying at its upcoming policy meeting at the end of July.

On global equity markets, it’s rally on. MSCI’s broadest index of Asia-Pacific shares outside of Japan are up around 1%, holding at two-year highs. Tokyo’s Nikkei 225 meantime has surged, crossing the psychological 42,000 level, driven by a rise in semi-conductor related stocks, marching higher in tandem with U.S. peers. U.S. futures though are lower as markets await the inflation print. 

 

All prices and analysis at 11 July 2024.  The content is distributed by WealthHub Securities Limited (WSL) (ABN 83 089 718 249)(AFSL No. 230704). WSL is a Market Participant under the ASIC Market Integrity Rules and a wholly owned subsidiary of National Australia Bank Limited (ABN 12 004 044 937)(AFSL No. 230686) (NAB). NAB doesn’t guarantee its subsidiaries’ obligations or performance, or the products or services its subsidiaries offer.  This material is intended to provide general advice only. It has been prepared without having regard to or taking into account any particular investor’s objectives, financial situation and/or needs. All investors should therefore consider the appropriateness of the advice, in light of their own objectives, financial situation and/or needs, before acting on the advice.  Past performance is not a reliable indicator of future performance.  Any comments, suggestions or views presented do not reflect the views of WSL and/or NAB.  Subject to any terms implied by law and which cannot be excluded, neither WSL nor NAB shall be liable for any errors, omissions, defects or misrepresentations in the information or general advice including any third party sourced data (including by reasons of negligence, negligent misstatement or otherwise) or for any loss or damage (whether direct or indirect) suffered by persons who use or rely on the general advice or information. If any law prohibits the exclusion of such liability, WSL and NAB limit its liability to the re-supply of the information, provided that such limitation is permitted by law and is fair and reasonable. For more information, please click here.


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