Morning Wrap: ASX 200 futures flat, S&P 500 and Nasdaq rise in choppy trade, Gold crosses US$4,200

ASX 200 futures are up 5 pts (+0.05%) as of 8:30 am AEDT.

In a nutshell:

• Major US benchmarks mostly higher, with S&P 500 up 0.40% but still down 1.0% since the US-China trade escalation last Friday

• Softness in sectors like Materials (-0.49%), Industrials (-0.47%) and Energy (-0.08%) resulted in the Dow trading flat while the Equal-weight S&P 500 (+0.20%) underperformed the official benchmark by 20 bps

• A busy session for headlines and news, with ratcheting up of US-China trade tensions, solid Q3 results, continued M&A activity in the AI space and dovish Fedspeak

Let's dive in.

S&P 500 SESSION CHART

S&P 500 slightly higher in a rather volatile session (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks mostly higher amid a relatively choppy session

• Slight pullback for Materials sector plus weakness in some cyclical/value sectors see the Dow flat and Equal-weight S&P 500 (+0.20%) underperform the official benchmark by 20 bps

• Another massive session for gold, now above US$4,200, while silver rallied 3.1% to a fresh all-time high of US$53.05/oz

• A rather busy overnight session, featuring i) ratcheting up of US-China trade tensions, ii) positive takeaways from Q3 reporters including Bank of America, Morgan Stanley and ASML, iii) pickup in M&A activity with a massive data centre deal between Blackrock, Microsoft and Nvidia

• Wall Street's investor anxiety gauge hits five-month high amid renewed US-China trade conflict concerns (RT)

• Investors wary ahead of Japan's 20-year bond auction amid political uncertainty (BBG)

STOCKS

• BlackRock, Microsoft and Nvidia strike data center deal for nearly 80 facilities worth $40bn (RT)

• Meta commits $1.5bn for AI data center in Texas (RT)

• Anthropic aims to nearly triple annualised revenue in 2026 (RT)

• Morgan Stanley CEO says bank might buy back shares at a "slightly higher cadence" (BBG)

• OpenAI developing a five-year plan to allocate over $1tn for advancing its AI initiatives (FT)

• Apple's shipments in China rose 0.6% to 10.8m units in Q3, capturing a 15.8% market share (RT)

• ASML orders beat, company talks up leverage to AI boom, shares up 2.7% (BBG)

• LVMH reported 1% growth in Q3 sales, driven by stronger demand in China despite a challenging luxury market, shares up 7.1% to seven-month high (RT)

• Netflix partners with Spotify to launch video versions of 16 podcasts (NYT)

TARIFFS

• China playing hardball with US on trade amid belief Trump will ultimately make a deal to avoid stock market selloff (WSJ)

• Trump team says it will not cave in negotiations with China (QTZ)

• Bessent warned China can't be trusted on global supply chain matters, calls out Chinese Vice Commerce Minister Li Cheng Gang as "unhinged" (BBG)

• Trump weighs termination of trade ties with China, targeting cooking oil, citing economic hostility over soybean purchases (BBG)

• China's rare earth export rules prompt threats from the US and EU, including potential trade restrictions (BBG)

CENTRAL BANKS

• Powell expresses support for potential rate cuts as the US job market shows signs of cooling (FT)

• Fed Governor Miran says US-China trade tensions pose new risk to growth outlook, sees significant disinflation over the medium-term (YF)

• BOJ watchers still see possible rate hike in either December or January 2026 (NK)

US SHUTDOWN

• Senate rejects bill to reopen government for eighth time, prolonging shutdown into third week (TH)

ECONOMY

• US shutdown halts vital data, complicating global policymaking and increasing risk of errors (RT)

• China's deflation eased in September with factory gate prices down 2.3%, marking 36th month of declines (BBG)

• IMF raises global growth forecasts for 2025 and 2026 citing resilience against tariffs; warns of US-China trade war risks (RT)

ASX TODAY

• Bougainville Copper in discussions with international mining parties for potential partner for its Panguna Project (BOC)

• Generation Development Group $74m block trade on offer at $7.38 per share, major shareholder M.H Carnegie Nominees seeking to offload stake (AFR)

• Infratil announces new AI data centre for CDC, to deliver ~40MW of data centre capacity located in Melbourne (IFT)

• Metallium announces breakthrough by Rice University, demonstrating method for rare earth recovery from magnet waste (MTM)

• Myer holder Lew Group raises stake from 26.8% to 29.7% (MYR)

• NSW court rules that Cosette cannot terminate Mayne Pharma takeover, still requires FIRB approval (AFR)

• Xero completes Melio acquisition, Melio has traded in-line with expectations through the first half of FY26 (XRO)

WHAT TO WATCH TODAY

• Gold and silver: Gold (GDX) and Silver (SIL) miner ETFs up 3.8% and 3.9% respectively overnight. Prices continue to go parabolic and push through key levels with ease. Expect another strong session for local names.

• Jumbo Interactive: Shares rallied 9.2% on Wednesday after the company announced the $109.9m acquisition of UK prize draw company Dream Car Giveaways (DCG). The business was valued at like 6.5x EV/EBITDA and expected to deliver double digit EPS accretion, so market clearly liking the growth profile/valuation. Wonder if we could see some further strength, some brokers also upgrading/revising their targets.

• Rare earth/lithium pullback: Seeing some heat come out of this surging sector, with MP Materials down 8.9% overnight and ADRs like Ioneer down 12.4%.

BROKER MOVES

• Chrysos initiated Buy with $9.85 target (GS)

• Computershare upgraded to Neutral from Sell but target cut to $39.00 from $41.200 (UBS)

• Evolution Mining downgraded to Neutral from Overweight; target remains $11.00 (JPM)

• Jumbo Interactive upgraded to Overweight; target up to $14.00 from $11.50 (JPM) 

Stocks trading ex-dividend: 

• Thu 16 Oct: Gowing Bros (GOW) – $0.03, K & S Corporation (KSC) – $0.08, Wam Microcap (WMI) – $0.053

• Fri 17 Oct: FFI Holdings (FFI) – $0.125

Other ASX corporate actions today:       

• Dividends paid: Flight Centre Travel Group (FLT), IVE Group (IGL), Lovisa Holdings (LOV), South32 (S32), Super Retail Group (SUL)

• Earnings: Bank of Queensland (BOQ)

• IPOs: None

• AGMs: ARB Corp (ARB), Aurizon (AZJ), Bailador Technology (BTI), Genesis Energy (GNE), Stockland (SGP), Treasury Wine Estates (TWE)

Economic calendar (AEST):

• 10:30 am: Australia Unemployment Rate (Sep)

• 4:00 pm: UK GDP (Aug)

• 11:00 pm: US Retail Sales, PPI (Sep)