Morning Wrap: ASX 200 to rise, Nvidia rally lifts the S&P 500 and Nasdaq

In a nutshell:

• Major US benchmarks finished higher and near session peaks, though technology was the only one of the 11 S&P 500 sectors to advance

• Chipmakers led the advance as Nvidia rose 8.7% on a forecast of about 70% revenue growth in fiscal 2028, with the Philadelphia Semiconductor Index up 2.3%

• Three Fed officials pushed back on rate cuts at the Jackson Hole opening, with Cleveland's Beth Hammack saying now is the time to act, ahead of Kevin Warsh's first keynote as chair on Friday

Let's dive in.

• Major US benchmarks finished higher and near highs, with the S&P 500 and Nasdaq posting best session since August 4

• Breadth was weak, with the S&P 500 Tech sector surging 3.4% on the Nvidia result while the Equal-weight S&P 500 fell 0.3%, underperforming the cap-weighted index by 102 bps

• Philadelphia Semiconductor Index rose 2.3%, with Nvidia up 8.7% and Broadcom up 4.5%. 

• VIX fell 4.5% to 14.5 as the Nvidia print cleared the calendar's biggest event risk, though the Russell 2000 added only 0.28% and breadth stayed narrow

• Long-end yields stayed elevated, with the US 10-year up 2 bps to 4.68% and the 30-year up 2 bps to 5.19%, held up by widening deficits and heavy AI-related debt issuance

• Brent was up 2% to US$88.46 a barrel making a second straight day of gains

• European tech outperformed sharply, the Stoxx Europe Tech index adding 1.8% in early trade on the Nvidia read-through while the broader Stoxx 600 hugged the flatline (CNBC)

• Allianz strategist Charlie Ripley warned the rally was narrow, saying higher interest rates, geopolitical tension and global trade are still weighing on sectors outside technology (RT)

• Nvidia Q2 FY27 revenue up 106% to $96.2bn, about 4% ahead of ests, with data centre up 117% to $89.0bn and Q3 guided to $108bn against $104.2bn ests. Management pegged FY28 revenue growth at 70% versus the 44% analysts expected, shares up 8.7% (CNBC)

• Amazon Web Services will buy 2m Nvidia GPUs and deploy the chipmaker's new Vera CPU, announced alongside the result (CNBC)

• Salesforce climbed ~22% as the top S&P 500 performer, on Q2 revenue of $11.35bn against consensus of $11.32bn and a deepened partnership with Anthropic (BBG)

• CrowdStrike jumped 20.5% on Q2 revenue of $1.47bn against consensus of $1.44bn and adjusted EPS of 31 cents versus the 29 cents expected (CNBC)

• HP Q3 FY26 revenue up 12.5% to a record $15.7bn with non-GAAP EPS of 83c up 10.7%, and Personal Systems revenue up 18% to $11.8bn on price rises even as units fell 16%. FY26 EPS guidance rose to $3.19-$3.29, shares down 1.5% on margin pressure (CNBC)

• Wendy's fell nearly 15% after Reuters reported Nelson Peltz's Trian Fund Management no longer plans to bid for the company, citing concerns about strategic direction (CNBC)

• The White House said no negotiations are currently under way between the United States and Iran, even as Qatar's prime minister met Iranian officials in Tehran on Thursday (CNN)

• Washington has repeatedly told mediators it has no interest in returning to the terms of the June memorandum of understanding with Iran and is focused on economic pressure instead (INV)

• Iran's security chief Mohsen Rezaei said Tehran is preparing a list of conditions to present to Washington for the reopening of the Strait of Hormuz (AJ)

• Iran and Oman reached an understanding on a temporary joint maritime corridor to let commercial shipping resume through Hormuz, the Iranian armed forces' Defa Press outlet reported (CBS)

• US allies are privately warning Hormuz is still likely mined, estimating 80 to 150 Iranian mines remain, directly contradicting Trump's claim the waterway has been cleared (BBG)

• Qatar's prime minister travelled to Iran on Thursday for talks aimed at de-escalating tensions between Tehran and Washington (CNBC)

• Only five ships made confirmed Hormuz crossings on Tuesday, down from seven the day before and against more than 130 vessels a day before the war, according to Kpler (CNBC)

• Canada's top economists told finance minister Francois-Philippe Champagne the damage from the trade war should be manageable, potentially strengthening Carney's case for walking away from talks (BBG)

• Canada's dollar-for-dollar retaliation takes effect on 8 September, covering steel, dairy, appliances, agricultural equipment, pulp, paper and electronics, after 50% US tariffs hit about $20bn of exports (BBG)

• Three Fed officials warned on inflation at the Jackson Hole opening, with Cleveland's Beth Hammack repeating her call for higher rates and saying she believes now is the time to act (YF)

• Kansas City Fed's Jeffrey Schmid said the current 3.50% to 3.75% policy rate does not appear restrictive, adding that inflation remains stubborn and sticky (BBG)

• NAB now forecasts an RBA hike at the 29-30 September meeting, with CBA and ANZ moving to November and Westpac still expecting rates on hold from here (AOL)

• Bank of Korea raised its base rate a quarter point to 3% in a 6-1 vote, a second straight hike, and lifted its 2026 growth forecast to 3.3% from 2.6% (BBG)

• US initial jobless claims fell 4,000 to 203,000 in the week to 22 August, below the roughly 208,000 expected, with the four-week average edging up to 205,500 (RT)

• China's industrial profits rose 17.6% year-on-year, losing momentum after an 18.7% pace across the first half of the year (CNBC)

• German consumer sentiment improved slightly in August on stronger income expectations, though the GfK index stayed negative and willingness to buy remained at rock bottom (CNBC)

• Australian private capex fell 3.6% quarter-on-quarter in the June quarter against consensus for a 0.8% rise, prompting JPMorgan to shave its Q2 GDP forecast (ABC)

• Australian businesses lifted 2026-27 capex plans to $200.7bn in the third estimate, 15.5% above the second estimate, keeping the investment pipeline intact (ABS)

• Civmec posts FY26 revenue of $903.0m, up 11.4%, with EBITDA of $107.3m, up 17.0%, at an 11.9% margin and NPAT of $52.1m, up 22.5%. EPS of 10.23c, up 22.2%, and a final dividend of 3.5c fully franked takes the FY26 total to 6.0c. Order book of $1.4bn at 31 July after establishing Civmec Defence Industries as a Commonwealth prime (CVL)

• Elevra Lithium lifts FY26 revenue 39% to US$202m as realised spodumene prices rose 57% to US$1,092/dmt FOB, offsetting a 13% fall in sales volumes to 181,494dmt. Underlying EBITDA of US$14m, including US$46m from North American Lithium, was a US$57m improvement, with NPAT of US$44m helped by a US$156m NAL impairment reversal. Closes with US$255m cash after the US$202m raise funding the NAL expansion (ELV)

• McMillan Shakespeare delivers FY26 revenue of $602.1m, up 6.8%, with EBITDA up 14.1% to $180.7m and operating margin 250bps wider at 41.5%. UNPATA of $107.9m, up 13.8%, and statutory NPAT from continuing operations of $106.7m, up 11.4%, on novated lease sales up 8.4% and BEVs at 57% of new novated leases. Fully franked annual dividend of $1.32 with ROCE of 62.1% and debt to EBITDA of 0.4x (MMS)

• Synlait Milk guides FY26 underlying EBITDA of NZ$36-41m and an underlying net loss of NZ$19-24m, with reported EBITDA of -NZ$2m to NZ$3m and a reported net loss of NZ$70-75m. Improvement on a first half that carried a reported net loss of NZ$80.6m and EBITDA loss of NZ$34.7m, with the guidance still subject to audit, impairment testing and the 2025/26 milk price. Full result due 28 September (SM1)

• Virgin Australia reports FY26 underlying EBIT of $753m, up 13.4%, with margin 60bps higher at 12.0% and underlying NPAT up 21.9% to $404m on diluted underlying EPS of 50.9c. Statutory NPAT of $501m, up 4.7%, with more than $450m of gross Transformation Program benefits offsetting airport and labour cost inflation. Declares a maiden post-relisting dividend of 7.6cps fully franked, with net debt of $1.2bn and leverage of 0.9x, below the 1-2x target (VGN)

• Yields getting spicy: Wednesday's hotter-than-expected Aussie CPI print has pushed local yields back to uncomfortable levels, with the 2-year up 15 bps over the past two sessions to 4.70% and the 10-year up 11 bps to 5.08%. Markets now put a 25 bp hike at the RBA's September meeting at roughly 50-50, and have fully priced one by November. Yield-sensitive and consumer-facing sectors bore the brunt on Thursday, notably Discretionary (-3.1%), Staples (-1.4%) and Real Estate (-1.4%). Those same sectors fell around 1% on Wall Street overnight despite the bumper Nvidia result, which might also put some rotation at play.

• Software: The iShares Expanded Tech-Software ETF rallied 7.7% to its highest level since November 2025, powered by a blowout result from Salesforce (+22.5%). SAP (+4.4%), Adobe (+5.7%) and Atlassian (+10.1%) all joined the move higher, a possible tailwind for local tech names today.

Stocks trading ex-dividend: 

• Fri 28 Aug: 360 Capital Mortgage REIT (TCF) – $0.05, Argo Global Listed Infrastructure (ALI) – $0.055, Beach Energy (BPT) – $0.02, Fiducian Group (FID) – $0.282, Iress (IRE) – $0.14, KKR Credit Income Fund (KKC) – $0.017, Orora (ORA) – $0.04, Quickfee (QFE) – $0.005, Regal Partners (RPL) – $0.12, Shape Australia (SHA) – $0.18

• Mon 31 Aug: Ansell (ANN) – $0.581, Aurizon Holdings (AZJ) – $0.105, Australian Finance Group (AFG) – $0.048, Carlton Investments (CIN) – $0.73, GR Engineering Services (GNG) – $0.13, Iluka Resources (ILU) – $0.03, Mitchell Services (MSV) – $0.02, Pengana International Equities (PIA) – $0.014, Pinnacle Investment Management (PNI) – $0.31, Wagners (WGN) – $0.05

• Tue 1 Sept: Bendigo and Adelaide Bank (BEN) – $0.33, Codan (CDA) – $0.29, Endeavour Group (EDV) – $0.012, Fortescue (FMG) – $0.46, L1 Group (L1G) – $0.02, Pengana Global Private Credit Trust (PCX) – $0.013, Propel Funeral Partners (PFP) – $0.069, Stealth Group Holdings (SGI) – $0.015 

• Wed 2 Sept: Seek (SEK) – $0.25, Origin Energy (ORG) – $0.30, Australian Clinical Labs (ACL) – $0.092, Mercury NZ (MCY) – $0.141, Whitehaven Coal (WHC) – $0.06, Solvar (SVR) – $0.085, Shriro Holdings (SHM) – $0.01, Yancoal Australia (YAL) – $0.07, Universal Store Holdings (UNI) – $0.17, Downer EDI (DOW) – $0.163, Sonic Healthcare (SHL) – $0.63, Medibank Private (MPL) – $0.109, Liberty Financial Group (LFG) – $0.23, PLS Group (PLS) – $0.05, Steadfast Group (SDF) – $0.128, Australian Ethical Investment (AEF) – $0.10, Monadelphous Group (MND) – $0.59, Newmont Corporation (NEM) – $0.26

Other ASX corporate actions today:       

• Dividends paid: FSA Group (FSA) – $0.035, Aspen Group (APZ) – $0.055, Growthpoint Properties Australia (GOZ) – $0.092, Dexus (DXS) – $0.177, Charter Hall Retail REIT (CQR) – $0.064, Region Group (RGN) – $0.072, DigiCo Infrastructure REIT (DGT) – $0.06, Gemlife Communities Group (GLF) – $0.011

• Earnings: Cobram Estate Olives (CBO), Carbonxt Group (CG1), Chimeric Therapeutics (CHM), CleanSpace Holdings (CSX), Decidr AI Industries (DAI), Dubber Corporation (DUB), Rivco Australia (RIV), FlexiRoam (FRX), Immuron (IMC), Jupiter Mines (JMS), Mach7 Technologies (M7T), Magontec (MGL), Mayfield Childcare (MFD), McMillan Shakespeare (MMS), Michael Hill International (MHJ), Orthocell (OCC), PEXA Group (PXA), Recce Pharmaceuticals (RCE), Saluda Medical (SLD), Elevra Lithium (ELV), Sea Forest (SEA), Senetas Corporation (SEN), Shine Justice (SHJ), SKY Network Television (SKT), SPC Global Holdings (SPG), Virgin Australia Holdings (VGN), Weebit Nano (WBT), Wellnex Life (WNX), Yojee (YOJ)

• IPOs: None

• AGMs: None

Economic calendar (AEDT):

• No major economic announcements.