Evening Wrap: ASX 200 higher on CPI beat, gold stocks shine as spot nears record

The S&P/ASX 200 closed 20.1 points higher, up 0.29%.

A gain is a gain, and Aussie investors will take anything they can get these days. But given the magnitude of the CPI beat, today's only modest gain is conspicuous. Gold stocks, however, sky rocketed as the spot gold price takes aim at record highs.

Let's dive in.

Markets

ASX 200 Session Chart

Stuck in the middle, lackluster S&P/ASX 200 price action today (Source: Market Index)

The S&P/ASX200 (XJO) finished 20.1 points higher at 7,035.3, smack-bang at the mid-point of the session's range. Possibly an unconvincing performance in light of today's good news on inflation (see Economy).

Beneath the surface, there did permeate a bullish tone, however. In the broader-based S&P/ASX 300 (XKO), advancers beat decliners by an impressive 187 to 95.

Several sectors did well today. The S&P/ASX All Ordinaries Gold Sub-Index (XGD) piled on another 4.8% making it the clear standout, but Information Technology (XIJ) +2.1%, Health Care Sector (XHJ) +1.8%, Consumer Discretionary (XDJ) +1.6%, and Real Estate Investment Trusts (XPJ) +1.0% also logged solid gains today.

The gold price keeps chugging along, pushing through the key US$2,010/oz resistance level we identified in Monday's evening update. It now looks on track to test all-time highs around US$2,073 set originally back in August 2022.

Just golden, spot gold prices on track for a test of the all-time high

Gold stocks were market beaters again today

Do I even need to mention it? Energy (XEJ) -0.8% and Utilities (XUJ) -0.6% were again shunned by investors. It wasn't due to crude oil prices, though, which rallied a touch.

West Texas Intermediate crude oil prices are at a crucial juncture from a technical perspective

Looking at the chart of West Texas Intermediate crude oil, I see US$80/barrel as the key level which must be reclaimed to give Woodside & Co. a boost. Alternatively, a close below US$72/barrel would likely spark another sell off.

Having said this, it was uranium and coal names in the worst of the sector list today. No major moves in either of those commodities in the last 24-hours, though...

Energy and utilities stocks can't take a trick at the moment

Economy

Great news for all Aussies today, but particularly for mortgage holders. Inflation is on the way down, CPI data released by the ABS today showed consumer prices increased 4.9% p.a. in October. This was down from September's 5.6% p.a. rate, and nicely below economists' expectations for a 5.2% p.a. increase.

Hey RBA! The trend is your friend!

Importantly for the RBA, it puts to an end a mini-surge in the CPI from July's 4.9% p.a. to September's 5.6% p.a. If the broader downtrend which started after December 2022's peak of 8.4% continues at the same pace it did prior to July, I estimate we could see the CPI back within the RBA's 2-3% target range in four months – so give or take March next year.

Along with yesterday's weaker than expected retail sales data, today's good new on inflation effectively rules out a hike at the RBA's meeting next month, and for me…I'm going to say there's a very good chance they're done!

What to watch out for...

Inflation week continues this evening with the release of European CPI data at 7pm AEDT, and then at 12:30am AEDT, we'll get a reader on US economic growth with the release of Preliminary GDP data. Economists are expecting the US economy expanded at 5% p.a. in the September quarter.

Interesting news and movers

Trading higher

• +14.6% Pantoro (PNR) - Surging gold sector

• +14.4% Temple & Webster Group (TPW) - 2023 AGM Presentation

• +12.5% Arafura Rare Earths (ARU) - No news since 27-Nov Indigenous Land Use Agreement Registered

• +10.0% Bowen Coking Coal (BCB) - Change in substantial holding

• +9.0% Resolute Mining (RSG) - Surging gold sector

• +8.6% Latin Resources (LRS) - No news

• +8.5% Kogan.Com (KGN) - No news

• +8.5% Link Administration Holdings (LNK) - 2023 AGM - Presentation

• +8.5% Vulcan Energy Resources (VUL) - No news

• +8.1% Judo Capital Holdings (JDO) - No news

• +7.9% Fisher & Paykel Healthcare Corporation (FPH) - Half Yearly Report and Accounts

• +7.3% Platinum Asset Management (PTM) - No news

• +7.1% Lotus Resources (LOT) - No news since 28-Nov Results of AGM

• +6.6% Perseus Mining (PRU) - Surging gold sector

• +6.2% Alkane Resources (ALK) - Surging gold sector

• +6.1% Emerald Resources (EMR) - Surging gold sector

Trading lower

• -29.7% EML Payments (EML) - Chairmans Address and AGM Presentation Slides

• -7.9% Core Lithium (CXO) - Sell off in several lithium stocks due to falling lithium minerals prices

• -7.5% Argosy Minerals (AGY) - Sell off in several lithium stocks due to falling lithium minerals prices

• -5.6% Ioneer (INR) - Sell off in several lithium stocks due to falling lithium minerals prices

• -5.2% Smartpay Holdings (SMP) - FY24 Interim Results Announcement

• -5.0% Deep Yellow (DYL) - Resource Drilling Grows Tumas Towards Plus 30 Year LOM

• -4.1% Audio Pixels Holdings (AKP) - No news

• -3.8% Boss Energy (BOE) - Sell off in uranium stocks

Broker notes

• Adore Beauty Group (ABY) retained at buy Citi; Price Target: $1.25

• Aroa Biosurgery (ARX) retained at buy Bell Potter; Price Target: $1.15 from $1.45

• Collins Foods (CKF)

  • Retained at neutral Citi; Price Target: $11.10

  • Retained at neutral UBS; Price Target: $10.95

  • Retained at accumulate Ord Minnett; Price Target: $14.40

  • Downgraded to outperform from buy at CLSA; Price Target: $12.50

• Chorus (CNU) retained at hold Ord Minnett; Price Target: $7.20

• CSL (CSL) retained at overweight Morgan Stanley; Price Target: $334.00

• IDP Education (IEL) upgraded from hold to buy at Bell Potter; Price Target: $27.00 from $26.70

• Infomedia (IFM) retained at buy UBS; Price Target: $2.00

• Link Administration Holdings (LNK) retained at neutral Citi; Price Target: $1.40

• Nickel Industries (NIC) retained at neutral Citi; Price Target: $0.90 from $0.95

• PointsBet Holdings (PBH) upgraded to buy from hold at Jefferies; Price Target: $0.91 from $0.80

• PeopleIn (PPE) downgraded to outperform from buy at CLSA; Price Target: $1.65 from $3.00

• Ramsay Health Care (RHC)

  • Retained at neutral Citi; Price Target: $50.00

  • Retained at equalweight Morgan Stanley; Price Target: $51.60

• Zip Co (ZIP) initiated buy at Unified Capital Partners; Price Target: $1.05

Scans