Evening Wrap: ASX 200 gains on BHP's big day out, Macquarie shares hit record on commodity price volatility

The ASX 200 edged higher as a US inflation print showing consumer prices falling for the first time in six years weakened the US dollar and lifted base metals prices, driving a sharp rebound in mining stocks and pushing BHP to its biggest single-session gain since mid-June. The recovery in materials was enough to carry the index, with most other sectors giving ground to a still-elevated oil price.

Be sure to click/scroll through for the usual reporting of the major sector and stock-specific moves, the broker responses to them, as well as all the key economic data in tonight's Evening Wrap. Also, I have detailed technical analysis on the Nasdaq Composite and the S&P/ASX 200 in today's ChartWatch.

Let’s dive in!

The S&P/ASX 200 (XJO) finished 32.6 points higher at 8,841.1, 0.36% from its session high/low – smack–bang at the mid-point of the session's range. Reflecting the indecision at benchmark level, but not reflecting the gain, in the broader-based S&P/ASX 300 (XKO) advancers lagged decliners by 131 to 142.

S&P-ASX 200 Materials Index (XMR) intraday chart

Materials (XMJ) (+1.7%) was the session's engine room, with several converging forces driving the rebound. A weaker US dollar — the direct consequence of the better-than-expected US CPI print overnight — made dollar-priced commodities cheaper for non-US buyers, stimulating demand.

Separately, poor weather threatening BHP's Chilean copper operations raised supply concerns that amplified the overnight copper price move. LME copper gained 1.5% overnight before easing 0.4% to US$6.354/lb in Asian trade. SGX iron ore futures consolidated above the US$100/t mark, adding 0.6% to US$100.65/t.

BHP (BHP) (+3.2%) was the standout — its biggest gain since mid-June — as investors positioned ahead of Thursday's operational review, with Rio Tinto's quarterly iron ore shipments beating expectations providing a positive read-through.

Capstone Copper (CSC) (+4.6%) led the copper names, with Rio Tinto (RIO) (+1.1%) and Sandfire Resources (SFR) (+0.9%) also advancing. Rio Tinto separately cut its copper C1 cost guidance to US30–50¢/lb from US65–75¢/lb, a material improvement that supported the stock despite a miss on copper volumes.

S&P-ASX 200 Financials Sector Index intraday chart

Financials (XFJ) (+0.2%) traded lower for much of the session before a concentrated buying order around 2:30pm — a recurring late-session phenomenon — pushed the sector fractionally positive, culminating in a 27-point pop in the closing price auction.

Macquarie Group (MQG) (+2.0%) was the session's standout financial, closing at an all-time record high of $258.16 — a beneficiary of this year's extreme commodity price volatility, which has driven outsized volumes and margins in its commodities and global markets division. Commonwealth Bank (CBA) (+0.4%) also advanced while National Australia Bank (NAB) (-1.1%) and ANZ (ANZ) (-0.4%) both fell.

Communication Services (XTJ) (-1.2%) was the session's worst-performing sector, dragged almost entirely by Telstra (TLS) (-2.0%), which continues to face selling pressure in the wake of last week's national network outage, compounded by media speculation about the potential scale of customer reparations.

The Gold Sub-Index (XGD) (-1.0%) was a mixed session masked by a negative sector headline — oil's continued rise pushed benchmark bond yields higher overnight, weighing on gold's appeal as a zero-income asset. COMEX gold futures fell 0.8% to US$4,037/oz and COMEX silver futures eased 0.7% to US$58.70/oz in Asian trade.

The selling was concentrated in mid-cap producers — Regis Resources (RRL) (-5.2%), Evolution Mining (EVN) (-3.7%), and Bellevue Gold (BGL) (-2.3%) all fell sharply — while the sector's major-cap anchors found buyers: Northern Star Resources (NST) (+1.1%) and Newmont (NEM) (+0.9%) both advanced, suggesting selective rotation within the sector rather than a wholesale exit.

Energy (XEJ) (-0.6%) fell despite ICE Brent crude futures rising a further 0.7% to US$85.30/bbl — a counterintuitive result that appears to reflect profit-taking after a week of strong gains, with investors deciding their positions had adequately captured oil's move so far. Viva Energy (VEA) (-2.1%), Beach Energy (BPT) (-1.7%), Yancoal Australia (YAL) (-1.4%), Ampol (ALD) (-1.1%), and Woodside Energy (WDS) (-0.9%) all fell.

Lithium Carbonate Futures (Benchmark month, back-adjusted) GFEX chart

Finally, lithium stocks bucked a negative commodity price backdrop — GFEX lithium carbonate futures fell 2.0% to CNY 149,240/t, their lowest level in months — to log broad gains in line with the mining sector's strength. IGO (IGO) (+3.9%) was lifted by a company-specific catalyst, agreeing to sell its Nova Nickel Operation in Western Australia to Global Lithium for $7 million. Elevra Lithium (ELV) (+4.0%), Vulcan Energy Resources (VUL) (+3.3%), Pilbara Minerals (PLS) (+2.4%), and Core Lithium (CXO) (+2.0%) also advanced.

Analysis

Middle East kicking-off again, CPI boilover… It seems like there’s something big each day to push/pull the Comp one way or the other.

Tuesday it was up, recouping all-and-a-bit-more of Monday’s decline.

As good as that sounds, it wasn’t a total demand side-dominant display. There was a whisker of an upward pointing shadow (you’ll have to zoom in to see it) – but just enough to make one think that the CPI boon may not be as enduring as many hope.

Tuesday’s candle’s higher high and higher low relative to Monday’s candle also sets Monday’s low of 25822 as a higher trough, the second versus 25015.

But neither Tuesday’s candle nor the higher trough it forms is definitive. Ultimately, little has changed with respect to the broader short term trend – which remains sideways – trapped between 24980-25015 below and 26789-27191 above.

The candles and price action since the 25015 trough are constructive, though, indicating modest demand side control – perhaps even building demand side control.

But for me, there’s insufficient evidence that the MOTN has swung decisively back to D > S = P ⬆️ to increase my portfolio risk position.

Steady as she goes… Optimistic that the long term trend will reassert itself, but positioned cautiously enough if it doesn’t.

View

I am at 1/2RP on my US portfolio (RP = Risk Position — it reflects my personal allowable capital allocation limit for my investments in US stocks. So 1/2RP is 50%, 2/3RP is 67% and FRP is 100% 🪣).

Key Levels

Dead simple! 26789-27191 is the key zone of supply vs 24980-25015 is the key zone of demand. In between = 1/2RP vs >= FRP and <= 1/3RP.

Analysis

Is the glass half-empty or half-full today? 🤔

More than half of the stocks in the ASX 300 were down... That's more of a half-empty sort of reader.

Arguably, the index was once again juiced by BHP and RIO – take those two out and we'd be break even at best...

And then there's the fact that in the closing juicing session, (ahem, the closing price auction) we saw yet another mysterious blip-up in the big banks – further juicing the OTP's final return and its candle.

But, as I said in today's ChartWatch Live (link below 👇): Who cares who's juicing and why they're juicing – just go up already!!! 🤦

I mean, look at today's upward pointing shadow – clearly there must be some big fund managers out there pushing back against the current FFS. What if they clear out the juicers – that wouldn't be good?

Plus there's the terrible market breadth. The index is higher than where it was a couple weeks ago – but most of the stocks in it aren't.

I guess my point is: sure the OTP's candles, price action, and trends are looking better today than they were a couple weeks back, but we're still well short of the convincing move that requires greater risk engagement.

8984-9022 is the key zone of supply. I have to see a cluster of strong demand side candles there (i.e., long white-bodied and or with long downward pointing shadows). Until then, I'm patiently watching and waiting with a bet each way.

View

I'm 1/2RP on my Aussie portfolio ⚖️ (i.e., my personal allowable capital allocation limit for my investments in Australian stocks is 50%).

Key Levels

8984-9022 is the key zone of supply, while demand is at 8708-8656 (now more than ever!).

(Glossary of acronyms! Old Tin Pot (OTP): S&P/ASX 200 | MOTN: More Often Than Not | FOMO: Fear Of Missing Out | HOFU: Holding On For Upside | BTD: Buy The Dip | NUTE: No Urgency To Enter | FOHO: Fear Of Holding On | STR: Sell The Rally | RP: Risk Position | FFS: Fund Flow Shenanigans!)

***NEW VIDEO DROPPED!!! 📺🍿***

Trading? Stack the odds in your favour with this easy to learn method – PLUS: ASX Lithium CRUNCHED! 💥

Today

• 12:00 CHN June 'Data Dump'

  • New Home Prices: -0.15% m/m vs -0.20% m/m in May

  • Fixed Asset Investment: -5.7% vs forecast -5.0% ytd/y and -4.1% ytd/y in May

  • GDP: +4.3% p.a. vs +4.5% p.a. in June quarter forecast and +5.0% p.a. in March quarter

  • Industrial Production: +5.3% p.a. vs +4.7% p.a. forecast and +4.5% p.a. in May

  • Retail Sales: +1.0% p.a. vs -0.1% p.a. forecast and -0.6% p.a. in May

  • Unemployment Rate: 5.0% vs 4.7% forecast and 4.5% in May

  • Reader: Generally a poor set of data for the Chinese economy and workers, however, industrial production remains a beacon of strength (retail sales also a nice pop).

Wednesday

• 22:30 USA June Core Producer Price Index (PPI) (+0.4% m/m forecast vs +0.4% m/m in May)

Thursday

• 00:00 USA Federal Reserve Chairman Keven Warsh testifies to the House Financial Services Committee Day 2

• 22:30 USA June Core Retail Sales (flat m/m forecast vs +0.8% m/m in May)

Friday

• 23:15 USA June Building Permits & Housing Starts (1.4 million and 1.31 million forecast vs 1.41 million and 1.18 million in May)

• 23:15 USA June Industrial Production (+0.2% m/m forecast vs 0.1% m/m in May)

Saturday

• 00:00 USA July Prelim UoM Consumer Sentiment (51.0 forecast vs 49.5 (revised up from 48.9) in June)