Morning Wrap: ASX 200 to dip, S&P 500 on a three-day skid, Dow slumps on broad weakness

ASX 200 futures are down 73pts (-0.85%) as of 8:30 am AEDT.

In a nutshell:

• Major US benchmarks finished broadly lower and near session lows

• S&P 500 (-0.92%), Dow (-1.18%) and Nasdaq (-0.84%) all traded below their 50-day moving averages

• Peter Thiel's fund sold off entire Nvidia stake and 76% of Tesla last quarter, adding to recent bearish moves (Softbank offloaded entire Nvidia stake, Michael Burry's entire portfolio is pretty much Nvidia and Palantir puts)

Let's dive in.

S&P 500 SESSION CHART

S&P 500 lower after weakness towards the second half of the session (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks opened around breakeven, dipped in afternoon trade to close near worst levels

• Third straight decline for the S&P 500, with the S&P 500, Dow and Nasdaq dropping below their 50-day moving averages in today's session

• VIX spikes to 22 vs. 17.5 three days ago, the highest since 17-Oct

• Bitcoin down 2.4% to US$91,900, a near seven month low and now down 27% sine its 6-Oct record high of US$126,272

• Another heavy session, with major benchmarks starting to roll over and undercut key moving averages, appears the bounce last Friday was rather fragile

• A catalyst rich week, with Nvidia earnings, retail earnings, FOMC minutes and a barrage of Fedspeak (plus September non-farm payrolls and global flash PMIs)

• Peter Thiel's fund sold off entire Nvidia stake last quarter and 76% of Tesla (BBG)

• Latest pullback hitting IPO market as fewer companies poised to list in Dec (BBG)

• UK government bonds stabilise following Friday's selloff over government's U-turn on taxes (FT)

• Bond traders brace for a deluge of data to influence Fed rate cut expectations after government shutdown (BBG)

• Morgan Stanley's Wilson predicts a 16% rally for the S&P 500, expecting it to reach 7,800 points by end-2026 (BBG)

• Japan's longer-maturity bonds fell sharply amid renewed fiscal concerns ahead of the government's economic package (BBG)

STOCKS

• Novo Nordisk undercuts Lilly, cuts price for obesity drugs (BBG)

• Amazon seeking to raise $12bn in bond sale, the first in three years (BBG)

• Deutsche Bank pledges to deliver higher growth, returns, payouts and lower costs by 2028 (FT)

• Rio Tinto adding surcharges onto aluminum shipments to the US as demand starts to outstrip supply (BBG)

• Alphabet's shares rise in premarket trading after Berkshire Hathaway revealed a $4.93bn stake in the company, shares finish 3.1% higher (RT)

• Jeff Bezos will reportedly become co-CEO of Project Prometheus, focusing on AI to enhance manufacturing (NYT)

• Goldman Sachs aims for largest share of deals market in 25 years, advising on 34% of 2025's global mergers (FT)

TARIFFS

• European trade officials concerned US push to expand list of products subject to higher steel, aluminum tariffs runs against trade agreement (BBG)

• Softer economic data from China, Japan, and Switzerland may reflect pressure from US trade readjustment (AX)

• Trump's administration plans to lower tariffs on food items to address consumer affordability after election warnings (WSJ)

• Bessent hopes a rare earths deal between the US and China will be finalised by Thanksgiving (RT)

ECONOMY

• Japan's GDP fell 1.8% year-on-year in Q3, supporting PM Takaichi's case for a stimulus package (BBG)

• Switzerland's GDP contracted 0.5% in Q3 due to US tariffs (FT)

• Eurozone GDP forecast to grow faster in 2025 due to surge in exports prior to expected tariff increases (BBG)

ASX TODAY

• ALS reports 1H25 NPAT of $178.4m vs. $174.7m ests, on-track to deliver full year organic revenue growth of 6-8% vs. prior 5-7% guidance (ALQ)

• Catapult sports reports first-half net loss of -$8.6m vs. -$3.6m ests, revenue of $67.6m vs. $66.5m ests, full-year free cash flow to be higher than FY25 (CAT)

WHAT TO WATCH TODAY

• Another heavy day: S&P 500, Dow and Nasdaq starting to undercut the key 50-day moving average, while the ASX 200 managed a small bounce off the 200-day on Monday. Indices are looking rather heavy and the path of least resistance has flipped to lower over the past 1-2 weeks. The Aussie 10-year continues to edge higher, up 4 bps this morning to 4.51% (trading with a 4.5 handle for the first time since May), the upward pressure/momentum for yields will likely weigh on equities. Wall Street is facing a broad number of headwinds after a massive rally, data points like auto loan and credit card delinquencies at 3.0% (highest since 2010) and 7.1% (highest in 14 yrs) respectively. Lots of big hitters turning bearish, with Peter Thiel selling his entire Nvidia stake (and Softbank last week plus Burry's entire portfolio shorting Nvidia and Palantir).

• Lithium: Pilbara Minerals (+3.6%) rallied on Monday after Ganfeng Lithium Group's chairman said he anticipates strong demand growth for lithium in 2026. Rare Earths/Strategic Metals ETF up 2.6% overnight, but faded early gains of 5.8%.

BROKER MOVES

• Elders reinstated Outperform from Neutral; target remains $8.25 (MQG)

• Mader Group initiated Outperform with $10.40 target (MQG)

Stocks trading ex-dividend: 

• Tue 18 Nov: Future Generation Global (FGG) – $0.04, Tamawood (TWD) – $0.105, WAM Active (WAA) – $0.003, WAM Income Maximiser (WMX) – $0.003

• Wed 19 Nov: None

• Thu 20 Nov: None

• Fri 21 Nov: N1 Holdings (N1H) – $0.003, Orica (ORA) – $0.32

Other ASX corporate actions today:       

• Dividends paid: None

• Earnings: ALS (ALQ), Catapult Sports (CAT), TechnologyOne (TNE)

• IPOs: None

• AGMs: Bluescope (BSL), Northern Star (NST), Regis Healthcare (REG)

Economic calendar (AEDT):

• 11:30 am: RBA meeting minutes