Morning Wrap: ASX 200 futures flat, S&P 500 and Nasdaq hit another record

ASX 200 futures are down 6pts (-0.07%) as of 8:30 am AEST.

In a nutshell:

• S&P 500 and Nasdaq hit another fresh all-time high overnight on positive trade negotiations

• Canada withdrew its digital service tax to restart trade talks with the US

• EU and US likely to reach a trade deal, that includes a 10% universal tariff on many of the bloc's key exports

Let's dive in.

S&P 500 SESSION CHART

S&P 500 higher, finished near best levels (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks broadly higher and closed near best levels, with the S&P 500 and Nasdaq setting fresh all-time highs

• Today’s key drivers – Positive trade headlines with Canada rescinding a digital-service tax in order to resume trade talks, EU and US likely to reach a deal by 9-Jul deadline

• US monthly recap: Nasdaq (+6.57%), Russell 2000 (+5.26%), S&P 500 (+4.96%), Dow (+4.32%)

• Traders betting on more US market gains, particularly in Nvidia and other momentum stocks, amid bullish options activity (BBG)

• US stocks return to record levels as optimism grows, with the S&P 500 rebounding over 8% since Trump's tariff announcement (WSJ)

• US profit margins will be tested in the upcoming earnings season due to Trump's trade war, says Goldman Sachs (BBG)

• US job market slowdown will pressure stocks, overshadowing potential benefits from Fed rate cuts, warms JPMorgan (BBG)

• Investors shift to Europe as Trump's tariff threats undermine US appeal (RT)

• Hedge funds rapidly sold energy stocks last week, the fastest pace since September 2024, as oil prices tumble (RT)

• Oil traders expect OPEC+ will agree a fourth 411K bpd oil supply hike this weekend (BBG)

• Citi expects gold price to consolidate around US$3,100-$3,500 in the third quarter (RT)

STOCKS

• Oracle inks cloud deal that would add more than $30bn annually starting in the FY28 year (CNBC)

• Meta's Zuckerberg previews restructuring of its AI group, focusing on developing "superintelligence" (Bloomberg)

• Microsoft unveils AI diagnosis tool in effort to transform medicine (FT)

• Robinhood launches US stock and ETF tokens in the EU (YF)

CENTRAL BANKS

• Fed's Bostic reiterates expectations for one rate cut this year and three more in 2026 (RT)

• Bessent criticises Fed for being "frozen" on deciding on rates (BBG)

TARIFFS

• Canada withdrew its digital services tax that targeted the largest US tech firms with a 3% levy on revenue to restart trade talks (BBG)

• EU is ready to accept a US trade deal that includes 10% universal tariff on many of its key exports, but wants the US to commit to lower rates on key sectors (BBG)

• Trump says he doesn't think he'll need to extend trade talk deadline beyond 9-Jul (BBG)

• Trump's trade deal with India faces delays (POL)

• UK-US trade deal takes effect, cuts car tariffs to 10% but 25% tariff on steel remains (BBG)

• South Korea seeks to extend trade negotiations with US beyond 9-Jul deadline for tariff exemptions on autos and steel (BBG)

ECONOMY

• China's manufacturing activity shrinks for third month in June, but new orders show improvement (BBG)

• Japan industrial production rebounds by less than expected, up 0.5% in May vs. expectations of a 3.5% gain (BBG)

• UK business confidence hits nine-year high despite tariff uncertainty (BBG)

ASX TODAY

Check out our Live Blog for the latest coverage and analysis for company announcements, market movements and economic updates.

• Domain’s takeover receives Independent assessment, values business at $4.06-4.46 vs. CoStar’s takeover offer of $4.43, therefore scheme is “fair and reasonable” (DHG)

• Suncorp issues FY26 reinsurance program update, total cost of FY26 catastrophe reinsurance program to be lower than FY25, seeks to maintain underlying insurance margin of 10-12% (SUN)

WHAT TO WATCH TODAY

• Continued chop around record levels: The market continues to chop within an arms reach of all-time highs. The ASX 200 rose 0.33% on Monday, down from session highs of 0.73%, though breadth was widely positive. Overall, we're seeing plenty of sectors showing strength, offset by weakness from heavyweight banks and miners.

• Nickel, gold and uranium: These overnight ETFs finished broadly higher, with Nickel (+3.3%) and Gold (+2.6%) bouncing after a recent pullback and Uranium (+1.9%) not far from taking out recent highs.

BROKER MOVES

• Medibank upgraded to Overweight from Equal-weight; target up to $5.57 from $4.50 (MS)

• Superloop retained Buy; target up to $3.55 from $3.35 (CITI)

 Stocks trading ex-dividend: 

• Tue 1 Jul: Ricegrowers (SGLLV) – $0.50

• Wed 2 Jul: Graincorp Ltd (GNC) – $0.24

• Thu 3 Jul: Als (ALQ) – $0.197, Clime Capital (CAM) – $0.014

Other ASX corporate actions today: 

• Dividends paid: Aristocrat Leisure (ALL)

• Earnings: None

• IPOs: None

• AGMs: None

Economic calendar (AEST):

• 11:45 am: China Caixin Manufacturing PMI (Jun)

• 3:00 pm: Japan Consumer Confidence (Jun)

• 7:00 pm: Eurozone Inflation (Jun)

• 12:00 am: US ISM Manufacturing PMI (Jun)

• 12:00 am: US JOLTs Job Openings (May)