Market Wraps

Morning Wrap: ASX 200 to fall, uranium stocks rally + Australian CPI set to ease

Wed 10 Jan 24, 8:36am (AEDT)

ASX 200 futures are trading 12 points lower, down 0.16% as of 8:30 am AEDT.

The S&P 500 lost ground and finished lower overnight, Fed policymakers continue to push back on rate cut expectations, uranium stocks rallied after the US announced plans to jump-start production of higher-energy uranium, the mines most at risk of closure amid a slump in battery metal prices and why earnings need to walk to walk.

Let's dive in.

Overnight Summary

Wed 10 Jan 24, 8:28am (AEDT)

Name Value % Chg
Major Indices
S&P 500 4,757 -0.15%
Dow Jones 37,525 -0.42%
NASDAQ Comp 14,858 +0.09%
Russell 2000 1,967 -1.10%
Country Indices
Canada 20,971 -0.49%
China 2,893 +0.20%
Germany 16,688 -0.17%
Hong Kong 16,190 -0.21%
India 71,386 +0.04%
Japan 33,763 +1.16%
United Kingdom 7,684 -0.13%
Name Value % Chg
Commodities (USD)
Gold 2,035.3 +0.13%
Iron Ore 140.87 -0.41%
Copper 3.7615 -1.63%
WTI Oil 72.13 +1.51%
AUD/USD 0.6685 -0.49%
Bitcoin (AUD) 69,856 -0.18%
Ethereum (AUD) 3,375 -3.49%
US 10 Yr T-bond 4.019 +0.42%
VIX 12.87 -1.61%

US Sectors

Wed 10 Jan 24, 8:28am (AEDT)

Information Technology +0.25%
Consumer Staples +0.24%
Communication Services +0.13%
Health Care +0.04%
Consumer Discretionary -0.14%
Industrials -0.24%
Financials -0.69%
Real Estate -0.74%
Utilities -0.76%
Materials -1.10%
Energy -1.63%


S&P 500 int
S&P 500 lower but finished well above worst levels (Source: TradingView)


  • S&P 500 lower but finished off worst levels of -0.70%

  • Small caps have come under renewed pressure, with the Russell 2000 underperforming major benchmarks

  • WTI crude settled ~2% higher after the 4% selloff on Tuesday

  • Economic worries and new supplies temper outlook for crude oil price (FT)


  • United Airlines shares rally after a double upgrade to Buy from Underperform from Bank of America, citing a “valuation disconnect” (CNBC)

  • Samsung expects profit to fall 35% on weak chip demand (Reuters)

  • Hewlett Packard Enterprise in talks to acquire Juniper Networks for $13bn (Reuters)

  • X to launch peer-to-peer payment platform this year (CNBC)

  • GM sold fewer cars in China than in the US for first time since 2009 as locals opt for domestic vehicles (Bloomberg)

  • US banks expected to report lower profits in Q4 amid defaulting loans (Reuters)

  • More than US$6.4bn in deals announced at JPMorgan Healthcare Conference (Bloomberg)


  • Atlanta Fed Bostic says it is too soon to declare victory over inflation (Bloomberg)

  • Fed Governor Bowman says “we are not yet at that point” to begin rate cuts and remains willing to hike based on incoming data (Reuters)

  • BOJ was a likely net seller of stocks in 2023 (Nikkei)


  • Blinken to discuss way forward in Gaza as he meets Israeli leaders (Reuters)

  • Senior Hezbollah and Hamas figures killed, stoking fears of wider war (FT)

  • Taiwan presidential candidate accuses China of election interference (FT)

  • Germany's Scholz pushes EU countries to boost military aid for Ukraine (Politico)


  • China's central bank indicates it may lower reserve ratio (Bloomberg)

  • China's share in key emerging-market index drops to record low, highlighting bearish sentiment on country (Bloomberg)


  • World Bank expects global growth to slow in 2024 (CNBC)

  • US trade deficit narrowed in November, both imports and exports declined (Reuters)

  • German industrial output posts sixth consecutive monthly decline (Reuters)

  • Tokyo core inflation slows to lowest in more than a year but consumer spending falls for ninth consecutive month (Bloomberg)

Industry ETFs

Wed 10 Jan 24, 8:24am (AEDT)

Name Value % Chg
Uranium 28.45 +3.98%
Silver 21.0 -0.62%
Copper Miners 36.468 -1.78%
Gold Miners 29.16 -1.82%
Lithium & Battery Tech 47.45 -2.23%
Steel 70.14 -2.95%
Strategic Metals 56.33 -2.98%
Agriculture 20.66 +0.73%
Construction 61.66 -0.40%
Global Jets 19.0 -0.73%
Aerospace & Defense 121.46 -0.79%
Biotechnology 138.94 -0.32%
Cannabis 5.7 -4.04%
Name Value % Chg
Bitcoin 22.71 -0.61%
Solar 47.91 -0.79%
CleanTech 10.0 -1.19%
Hydrogen 6.3899 -2.00%
Cybersecurity 28.79 +1.41%
E-commerce 20.71 +0.34%
Robotics & AI 27.73 +0.11%
Cloud Computing 22.03 +0.09%
Video Games/eSports 55.9 +0.07%
Semiconductor 559.68 +0.03%
FinTech 24.69 -1.24%
Electric Vehicles 23.64 -1.25%
Sports Betting/Gaming 16.6 -1.31%

Another Kicker for Uranium Equities 

The Global X Uranium ETF rallied 4.0% overnight after the US Department of Energy announced the next steps to build domestic uranium supply for advanced nuclear reactors.

  • The DoE issued request for proposals for uranium enrichment services to help establish a reliable domestic supply of fuels called high-assay low-enriched uranium (HALEU)

  • HALEU is uranium fuel that is enriched up to 20% compared to traditional uranium fuel used in today's reactors of about 5%

  • Biden's Inflation Reduction Act will provide up to US$500 million for HALEU enrichment contractors

  • DoE's Nuclear Energy plans to award one or more contracts to produce HALEU from domestic uranium enrichment capabilities

  • The HALEU enrichment contract has a maximum duration of 10 years and the government assures each contractor will have a minimum order value of US$2 million to be fulfilled over the term of the contract

Cameco – one of the world's largest uranium companies – rallied 4.7% overnight.

Mines at Risk of Closure

The AFR has short-listed eight mines that are most at risk of closure amid the recent slump in battery metal prices. The candidates include:

  • First Quantum Minerals and POSCO's Ravensthorpe nickel and cobalt mine

  • Arcadium Lithium's Mt Cattlin lithium mine

  • Consolidated Minerals' Woodie Woodie manganese mine

  • Mineral Resources' Bald Hill lithium mine

  • Andrew Forrests' Wyloo Metals

  • Glencore's Mt Isa zinc, lead, silver and copper project

I only listed six because the article mentions Albemarle, Tianqi and IGO's Greenbushes and MinRes' Mt Marion – They definitely don't belong in that list – Even if the article acknowledges them being low cost.

Where Are We Now?

Markets experienced a sizeable bounce on Tuesday and continue to linger around recent highs. While most positioning and sentiment indicators remain stretched – We're going to look at some bigger picture stuff today.

A recent thread from Jurrien Timmer, the Director of Global Macro at Fidelity talks about a potential early-cycle bull market. Here are the key takeaways:

  • The early cycle bull market narrative is on track, as per the below chart, which examines historic returns from the start of the cycle

Source: Fidelity
  • Most of the gains since October 2022 have been driven by multiple expansion

  • Multiple expansion is when the 'Price' in Price-to-Earnings increases while 'Earnings' remains relatively muted

  • On average, the first year of a bull market produces a 40-50% P/E expansion. This is because the market tends to bottom a few quarters before earnings do

  • Timmer suggests that the market is nearing a point of maximum P/E expansion. This means earnings will need to start to do the heavy lifting

  • Consensus currently expects S&P 500 earnings to rise ~12% in 2024. The expectations are there but can the companies deliver?

Key Events

ASX corporate actions occurring today:

  • Trading ex-div: None 

  • Dividends paid: None

  • Listing: None

Economic calendar (AEDT):

  • 11:30 am: Australia Monthly CPI Indicator (Nov) 

Written By

Kerry Sun

Content Strategist

Kerry holds a Bachelor of Commerce from Monash University. He is an avid swing trader, focused on technical set ups and breakouts. Outside of writing and trading, Kerry is a big UFC fan, loves poker and training Muay Thai. Connect via LinkedIn or email.

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