Morning Wrap: ASX 200 to open at record highs, Wall Street rallies + Uranium, gold stocks higher

S&P 500, Nasdaq and gold all hit fresh record highs overnight, bond yields and the US dollar continued to ease following Powell's second day of speaking at Capitol Hill, Novo Nordisk surpasses Tesla in market cap, the European Central Bank kept rates on hold but markets increasingly expect a June rate cut.

Let's dive in.

S&P 500 SESSION CHART

S&P 500 gaps up and finishes near best levels (Source: TradingView)

ASX TODAY

• ASX 200 set to open at another fresh all-time high

• Coast Entertainment 48.5m block trade crosses at 45.5 cents (3.2% discount to last close) representing 10.1% of the company

• Genesis Minerals reports first-half net profit of $17.7m, says its making rapid progress towards goal of producing 300,000 ounces per annum (Announcement)

• Ramelius in exclusive due diligence to buy Karora (AFR)

• Pacific Current sells 4.0% GQG stake (AFR)

BROKER MOVES

These refer to any notable broker upgrades or downgrades since yesterday afternoon.

• 29Metals downgraded to Neutral from Overweight at Jarden with $0.38 target price

• Charter Hall upgraded to Outperform from Underperform at CSLA and target price increased to $13.74 from $11.74

• Ingenia Communities upgraded to Outperform from Underperform at CSLA and target price increased to $5.51 from $4.82

• Nufarm downgraded to Hold from Buy at Bell Potter with $6.35 target price

• Sandfire Resources downgraded to Neutral from Overweight with $6.50 target price

• WA1 Resources initiated speculative Buy at Bell Potter with $17.65 target price

MARKETS

• S&P 500 posted another record close and finished near best levels

• Big tech led to the upside following some recent selling pressure, notable winners include Nvidia (+4.5%), Meta (+3.3%) and Alphabet (+2.0%)

• Bond yields continued to trend lower overnight following Powell's dovish comments – the US 2-and-10 year yields hit fresh one month lows overnight

• US dollar index on a five day losing streak, down to lowest level since 16 Jan

• Goldman Sachs raises share buyback forecast for S&P 500 on stronger than expected mega-cap tech growth (Reuters)

• Foreign net flows to emerging markets hit US$22bn in February (Reuters)

• US crude stockpiles rise less than expected (Reuters)

INTERNATIONAL STOCKS

• Meta, Google big beneficiaries of Temu's push into US (MSN)

• Carlyle, KKR among firms interested in acquiring Samsonite (Bloomberg)

• Rivian rolls out new EV models with prices starting at US$45,000 (CNBC)

• Novo Nordisk tops Tesla valuation on obesity drug progress (Reuters)

CENTRAL BANKS

• Powell says Fed likely to ease at some point this year but needs more confidence on inflation (Bloomberg)

• Fed's Kashkari expects two rate cuts in 2024 (Bloomberg)

• ECB keeps rates on hold but acknowledges some inflation cooling (Reuters)

• ECB lays ground for June rate cut as inflation falls (Reuters)

• Japan government officials support near-term BOJ rate hike (Bloomberg)

• Powell says bank capital plan likely to see significant changes (Bloomberg)

GEOPOLITICS

• Sweden officially joins NATO military alliance (CNBC)

• Gaza ceasefire prospects increasingly fading amid deadlock in negotiations (Bloomberg)

• US government pressing allies to further tighten curbs on China's access to semiconductor technology (Bloomberg)

• White House recently asked for list of all weapons transfers to Israel planned for approval in coming weeks (Axios)

ECONOMY

• US CEO confidence soars to highest since mid-2022, reflecting stronger sales outlook, investment improvements and hiring plans (Bloomberg)

• Japan nominal wages rise at fastest pace since June (Bloomberg)

• China Jan-Feb export growth tops forecasts, positive sign for global trade (Bloomberg)

• German factory orders fell sharply in January after big jump in December due to large orders (Bloomberg)

More Powell highlights

Fed Chair Powell said the Fed will be patient until it is more confident inflation is moving sustainably towards the 2 percent target at his second day speaking at Capitol Hill. Encouragingly, he said the Fed is not far from that level of confidence. Here are the key highlights and takeaways from Powell:

• On commercial real estate: "This is a problem that we'll be working on for years more. I'm sure there will be bank failures, but this is not the big banks ... it's more smaller and medium-sized banks that have these issues, we're working with them ... I think it's manageable."

• On rates: "Interest rates right now are well into restrictive territory ... they're well above neutral ... we've said for some years that we would start restoring the federal funds rate to a more normal, almost neutral level. We're far from neutral now."

• On cuts: "When we do get that confidence [of inflation heading towards 2 percent] ... and we’re not far from it ... it will be appropriate to dial back that level of restriction."

From Strength to Strength

Here are some of the more interesting sub-sector overnight movers.

Uranium: The Global X Uranium ETF rallied 4.78% overnight to a three week high. The ETF was previously down around 15% from February highs amid a pullback in uranium spot prices. The strong overnight move should see some strength follow through for local names like Paladin Energy, Boss Energy and more. Uranium equities had a strong start to the year, experienced a bit of a pullback and now starting to kick on – Let's see if this strength persists.

Gold: Gold hit another fresh all-time high overnight of US$2,159 an ounce. Gold stocks performed strongly on Thursday, with most large cap names up around 2-3% and closing near session highs. Another fresh record high for gold prices should see some more positive flow follow through for local miners and explorers.

Materials: SPDR S&P Metals & Mining ETF (this is not in the above ETF watchlist) rallied 2.59% overnight. Lower yields and a US dollar typically a tailwind for resource-related sectors. Iron ore names have been under pressure in recent weeks. Let's see if they catch a bid on Friday.

ASX corporate actions occurring today:

• Trading ex-div: Summerset Group (SNZ) – $0.106, Nine Entertainment (NEC) – $0.04, Copper Strike (CSE) – $0.006, Meridian Energy (MEZ) – $0.056, Finexia Financial (FNX) – $0.05, Wisetech (WTC) – $0.077, Insignia Financial (IFL) – $0.09 

• Dividends paid: GUD Holdings (GUD) – $0.185, JB Hi-Fi (JBH) – $1.58, Whitehaven Coal (WHC) – $0.07

• Listing: None

Economic calendar (AEDT):

• 12:30 am: Canada Unemployment Rate (Feb)

• 12:30 am: US Unemployment Rate (Feb)