Market Wraps

Morning Wrap: ASX 200 to fall, S&P 500 tries to bounce + Oil prices surge to 11-month high

Thu 28 Sep 23, 8:37am (AEDT)

ASX 200 futures are trading 13 points lower, down -0.18% as of 8:20 am AEST.

US equities finished mixed in choppy overnight trade, Energy stocks soar as oil prices rally more than 3%, gold prices tumble below US$1,900 for the first time since March, Goldman Sachs says there's a 90% likelihood of a US government shutdown, market breadth is at multi-month lows as sentiment flips to extremely bearish and Goldman Sachs flags a further decline for Aussie bank margins.

Let's dive in.

Overnight Summary

Thu 28 Sep 23, 8:37am (AEDT)

Name Value Chg %
Major Indices
S&P 500 4,275 +0.02%
Dow Jones 33,550 -0.20%
NASDAQ Comp 13,093 +0.22%
Russell 2000 1,779 +0.98%
Country Indices
Canada 19,436 -0.61%
China 3,107 +0.16%
Germany 15,217 -0.25%
Hong Kong 17,612 +0.83%
India 66,119 +0.26%
Japan 32,372 +0.18%
United Kingdom 7,593 -0.43%
Name Value Chg %
Commodities (USD)
Gold 1,893.20 -1.39%
Iron Ore 120.84 -
Copper 3.645 -0.12%
WTI Oil 93.71 +3.67%
AUD/USD 0.6353 -0.01%
Bitcoin (AUD) 41,347 +0.43%
Ethereum (AUD) 2,510 +0.43%
US 10 Yr T-bond 4.626 +1.49%
VIX 18 -3.80%

US Sectors

Thu 28 Sep 23, 8:37am (AEDT)

Sector Chg %
Energy +2.51%
Industrials +0.76%
Communication Services +0.54%
Information Technology +0.17%
Materials +0.02%
Financials -0.20%
Consumer Discretionary -0.38%
Health Care -0.50%
Consumer Staples -0.77%
Real Estate -0.83%
Utilities -1.93%


S&P 500 intraday chart
S&P 500 finishes breakeven amid choppy trade (Source: TradingView)


  • S&P 500 finished around breakeven but well off session lows of -0.82%

  • Bond yields briefly pulled back but finished higher, with the 10-year up 7 bps to 4.61% – The highest since October 2007

  • Gold settled 1.3% lower, now down 2.6% in the last three sessions and marked its first closed below US$1,900 since 10 March

  • WTI crude rallied above US$94 a barrel for the first time since August 2022, set for an almost 30% gain for the quarter

  • Goldman Sachs raised its US government shutdown odds up to 90% but says any shutdown will end after two to three weeks (Yahoo)

  • Goldman Sachs says ~90% of S&P companies likely to be in their buyback blackout periods by the end of the week as Q3 earnings season approaches

  • European stocks close at a six-month low as global data continues to cause concern (CNBC)

  • Treasury 'term premium' gauge positive for first time since 2001, underscoring the potential for rates to stay higher for longer (Bloomberg)

  • US small-cap stocks wilt in the heat of higher rates (FT)

  • Oil climbs 3% as steep US crude stocks draw add to supply concerns (Reuters)


  • Costco Q4 earnings top estimates, sales hold steady amid high gas prices (Yahoo)

  • OpenAI seeks $90bn valuation in possible share sale (Yahoo)

  • ArcelorMittal sees global steelmakers buoyed by China output limits (Bloomberg)


  • Kashkari says Fed may do less if risks like shutdown hit (Bloomberg)

  • ECB's Holzmann says shocks from energy prices may force ECB to raise rates again (Bloomberg)

  • BOJ members differed on hitting price target as YCC was tweaked (Bloomberg)


  • China property stocks slide to lowest since 2011 (Bloomberg)

  • China investor gloom on property reaches record, investors plan to cut property exposure, survey shows (Bloomberg)

  • PBoC to use 'precise, forceful' policy to bolster recovery (Reuters)

  • China's industrial profits posts strong rebound in August (ChinaView)

  • Major Evergrande creditor to seek liquidation if no new debt plan soon (Reuters)

  • China Evergrande's Chairman Hui under police surveillance (Bloomberg)


  • US durable goods orders beat expectations in boost to economy in Q3 (Reuters)

  • German consumer sentiment unlikely to recover this year, GfK says (Reuters)

  • Australia CPI rose to 5.2% in August on higher oil prices (Guardian)

  • Peru approaching peak-copper in 2024 as new mines stall (Bloomberg)

Industry ETFs

Thu 28 Sep 23, 8:37am (AEDT)

Description Last Chg %
Steel 64.9605 +1.29%
Lithium & Battery Tech 53.84 +0.19%
Uranium 27.15 -0.18%
Copper Miners 35.4 -0.56%
Strategic Metals 64.42 -0.82%
Silver 20.7 -1.24%
Gold Miners 26.91 -2.99%
Construction 50.29 +0.98%
Aerospace & Defense 106.39 +0.94%
Global Jets 16.9 +0.30%
Agriculture 21.61 -0.28%
Biotechnology 123.11 +0.47%
Cannabis 6.97 -1.55%
Description Last Chg %
Bitcoin 13.47 0.00%
Hydrogen 7.38 +1.23%
CleanTech 10.82 +0.84%
Solar 51.68 -0.12%
Robotics & AI 24.41 +1.20%
Cybersecurity 24.02 +1.01%
Semiconductor 463.36 +0.88%
E-commerce 17.79 +0.79%
Video Games/eSports 50.9 +0.71%
Cloud Computing 18.55 +0.71%
Electric Vehicles 23.15 +0.56%
Sports Betting/Gaming 15.9285 +0.40%
FinTech 19.73 +0.10%

Market Breadth In Question

The percentage of S&P 500 stocks trading above their 200-day moving average is at multi-month lows.

Source: Barchart

While the percentage of S&P 500 stocks trading above their 50-day is now only 12%. The only times we've seen readings at such depressed levels was:

  • The market low of October 2022

  • The Covid lows in 2020

  • Taper tantrum in 2018

The indicator also suggests that the consensus is growing ever more bearish, supported by the fact that hedge funds are loading up on bearish bets. Could this be another market low? Or is the market in a terribly unhealthy state?

Another indicator (McClellan Oscillator chart below) suggests the S&P 500 is - temporarily at least - oversold. So while there may be some window dressing for the end of the month/quarter, any bounce may be short-lived. And as for any further sell-down .... well, good luck.

F6 JgbfWsAAuK0X

Goldman Sachs and Banks

Back to our local market and Goldman Sachs has undertaken its regular review of the Big Banks' earnings forecasts. The big change is an upward revision to its base case around loan growth for both businesses and individuals (i.e. mortgages) but a further decline in net interest margins. Remember, NIMs, as they are called, are one of the most important metrics for banks beyond the dividend and cash profit.

  • "While we’ve seen some relief in mortgage competition, we do not expect this to be sustained over the remainder of CY23 and into 2024."

  • "Our major banks’ (+BEN) FY23/24/25e cash EPS moves by between -2% (ANZ FY25E) and +2% (CBA FY24E), with more elevated downgrades for BOQ on costs."

  • Bank of Queensland (ASX: BOQis downgraded to a SELL with a new $5.60 price target

  • Preference for ANZ (ASX: ANZover the other majors

CLSA's Double-Moves

One last point of interest before I let you get on with your day. CLSA did something relatively unusual yesterday.

It issued a double downgrade for Qantas (ASX: QANfrom Overweight to Underweight (with a $5.60 price target).

Then, it issued a double upgrade for Pro Medicus (ASX: PMEfrom Sell to Outperform with a new price target of $88.80.

It smells like a classic case of playing catch-up but only time will tell.

Key Events

ASX corporate actions occurring today:

  • Trading ex-div: There are 40 stocks trading ex-div today. See a full list here

  • Dividends paid: There are 24 companies paying out dividends today. See a full list here

  • Listing: Pioneer Lithium (PLN) at 11:00 am 

Economic calendar (AEST):

  • 11:30 am: Australia Retail Sales

  • 10:00 pm: Germany Inflation

  • 10:30 pm: US Q3 GDP

Written By

Hans Lee

Content Editor

Hans is a Content Editor at Livewire Markets and Market Index. He created Signal or Noise and helps write the LW-MI Morning Wrap on Tuesdays and Thursdays.

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