Market Wrap

ASX Pre-market wrap: Overnight markets bounce as full blown lockdowns unlikely

Wed 22 Dec 21, 9:32am (AEST)

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ASX Futures (SPI 200) imply the ASX will open 4 points higher or up 0.05%.

Wall Street bounced back from a three-day rout on omicron concerns. Could a Santa Claus rally take us into the year end?

Overnight summary

Wed 22 Dec 21, 9:32am (AEST)

Name Value Chg %
US Indices
S&P 500
4649.23 +1.78%
Dow Jones
35,493 +1.60%
15,341 +2.40%
Russell 2000
2,203 +2.95%
Country Indices
0 0.00%
0 0.00%
15,447 +1.36%
Hong Kong
0 0.00%
0 0.00%
0 0.00%
United Kingdom
0 0.00%
Name Value Chg %
Commodities (USD)
1,801.60 +0.77%
Iron Ore
112.54 -
4.39 +1.19%
72.76 +2.31%
0.7153 +0.54%
0 0.00%
0 0.00%
U.S. 10 Year Treasury
1.487 +4.79%
21 -8.13%

All three major US averages rebounded overnight as the Biden administration promised that they will avoid March 2020-like lockdowns and outlined a roadmap to fight against rapidly surging covid cases. 

President Joe Biden’s US$2 trillion “Build Back Better” plan was rejected by Democratic West Virginia Senator Joe Manchin on Monday, saying he wouldn’t vote in favour in the 50-50 senate.

Manchin previously said that inflation was a bigger concern than the need for the package. 

Encouragingly, the Senate will vote on the economic plan in January, suggesting further negotiations are likely. 

It's worth noting that the ASX rallied 0.9% yesterday, ahead of the overnight rebound in the US market.

US Sectors

Wednesday, 22 December 2021

Sector Chg %
Communication Services 0.00
Consumer Discretionary 0.00
Consumer Staples 0.00
Energy 0.00
Financials 0.00
Health Care 0.00
Sector Chg %
Industrials 0.00
Information Technology 0.00
Materials 0.00
Real Estate 0.00
Utilities 0.00

Energy stocks bounced on optimism that holiday travel will not be disrupted for the vaccinated population. Crude oil prices reclaimed the US$70/b mark after sliding to lows of US$66/b on Tuesday. 

“Both the US and UK are not headed to lockdowns and that suggests the short-term outlook might not get completely derailed by the omicron variant,” said OANDA senior market analyst Ed Moya. 

With the market opening up its appetite for risk assets, struggling technology stocks were ripe for a rebound. Mega cap tech stocks including Apple, Amazon, Microsoft, Meta (Facebook) and Tesla all rallied more than 2%. 

Consumer discretionary, notably reopening plays like airlines and entertainment stocks experienced some relief buying in overnight trade. Names like Delta Air Lines, United Airlines, Boeing and Booking Holdings all bounced more than 5%. 

Industry ETFs

Wednesday, 22 December 2021

Description Last Chg %
Aluminum 58.01 +3.88%
Copper Miners 35.76 +2.88%
Gold 167.02 -0.04%
Lithium & Battery Tech 82.26 +1.34%
Nickel 25.81 +1.89%
Strategic Metals 104.65 +1.22%
Steel 52.05 +2.24%
Silver 20.77 +0.97%
Uranium 24.41 +6.13%
Aerospace & Defense 100.72 +3.79%
Global Jets 21.04 +5.25%
Biotechnology 153.95 +0.61%
Cannabis 6.39 +2.73%
Description Last Chg %
Bitcoin 30.84 +3.56%
CleanTech 17.69 +4.86%
Hydrogen 20.62 +3.41%
Solar 77.94 +5.67%
Cloud Computing 27.35 +3.30%
Cybersecurity 31.67 +2.23%
E-commerce 27.23 +4.17%
Electric Vehicles 0 0.00%
FinTech 42.07 +4.42%
Robotics & AI 35.69 +2.91%
Semiconductor 530.12 +3.61%
Sports Betting/Gaming 24.22 +4.58%
Video Games/eSports 66.66 +4.38%

ASX Sectors in play


The Uranium ETF has started to consolidate around its 200-day moving average after a harsh 30% correction from November all-time highs. Uranium spot prices have remained stable at US$42.88/lb according to fuel brokers Numerco. 

  • ASX uranium stocks rebounded strongly on Tuesday, with the largest player Paladin Energy (ASX: PDN) up 4.4% 

The Jets ETF fell close to 13-month lows on Tuesday. The ETF bounced on positive news from the Biden administration, saying that they will avoid full blown lockdowns. That said, daily covid infections in the US have surged to levels not seen since September.

Restrictions have continued to mount for European countries, with Portugal and Spain being the latest nations to impose curfews, social gathering limits and closure of nightclubs. 

  • Nevertheless, the overnight rebound could see some relief buying for ASX players like Qantas Airways (ASX: QAN), Flight Centre Travel Group (ASX: FLT) and Webjet (ASX: WEB), most of which have tumbled to near-term lows 

The beaten up Sports Betting & iGaming ETF is showing an encouraging bottom after a strong bounce off 12-month lows on two occasions in the past few weeks. Major US sports betting names like DraftKings and Penn National Gaming surged 7.9% and 8.6% respectively overnight. 

  • This could drive some positive flow for struggling ASX players like PointsBet (ASX: PBH), BetMakers Technology Group (ASX: BET) and BlueBet (ASX: BBT

  • Large cap gambling machine manufacturer Aristocrat Leisure (ASX: ALL) could also benefit

The FinTech ETF hit fresh 13-month lows yesterday. Far more work is needed to show investors that the overnight gains are more than just a short-lived bounce. Notable names like Block (formerly Square) rallied 7.7%, Fiserv bounced 4.7% and Coinbase closed 4.1% higher. 

  • Afterpay (ASX: APT) shares are expected to bounce following the overnight move from Block 

  • ASX tech stocks like WiseTech Global (ASX: WTC), Altium (ASX: ALU) and Xero (ASX: XRO) all closed in positive territory on Tuesday 

Similarly, the eCommerce ETF bounced off 15-month lows, driven by gains from China’s (+7.6%), Williams-Sonoma (+3.3%) and Etsy (+2.9%). Shares in eBay slightly lower, down -0.1%. 

  • ASX eCommerce names like Redbubble (ASX: RBL) and (ASX: KGN) are sitting in no mans land, trading at 16-month lows after plunging more than 30% in the last 2-months

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Written By

Kerry Sun

Finance Writer & Social Media

Kerry holds a Bachelor of Commerce from Monash University and was Vice President of the University Network for Investing and Trading (UNIT). He is an avid swing trader, and drawn to breakouts and technical set ups. Outside of writing and trading, Kerry is a huge UFC fan, loves poker and bouldering.

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