Morning Wrap: ASX 200 to rise, Russell 2000 hits all-time high, Oil and gold prices tumble

ASX 200 futures are trading 52 points higher, up 0.61%, as of 8:30 am AEDT.

Major US benchmarks finished higher but well off best levels, investors continued to rotate into small caps and cyclicals while pivoting out of energy, Trump-related trades and crypto, bond yields fell sharply on US growth concerns, oil prices tumbled amid Middle East ceasefire news and gold suffered its worst one-day session since mid-June.

Let's dive in.

S&P 500 SESSION CHART

S&P 500 fades from session highs (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks finished higher but well off session highs

• Rotation remains a big theme with small caps and select cyclicals outperforming while Trump trades and crypto lag

• Bond yields fell sharply on US growth risks, with the US 10-year down 14 bps, lowest since election week

• Gold finished 3.2% lower, giving back the last three days worth of gains and marking the worst day since 22-Jun

• Trump finalises economic team, Goldman Sachs sees biggest upside inflation risks as policy-related, estimating 10% across the board tariff would raise core prices by 1pp and delay return to 2% inflation target

• Trump tariffs and immigration restrictions to offset fiscal easing and deregulation, GDP growth to slow to ~2.3% in 2025 and ~2.0% in 2026, says BofA

• Russell 2000 hits new all-time highs boosted by optimism around Trump policies and Fed rate cuts (RT)

• Barclays and RBC issue year-end target of 6,600 for the S&P 500 (YH)

• Deutsche Bank sets 2025 S&P 500 price target of 7,000 (RT)

• Treasuries rally as investors see Bessent as fiscal hawk, while dollar eases from two-year high (CNBC)

• Oil prices tumble on Middle East ceasefire news and Trump’s wide-ranging energy plan to boost oil drilling and gas exports (RT)

STOCKS

• BP predicts strong growth in US on Trump deregulation moves (BBG)

• US retailers lure shoppers with deals as consumers bargain hunt in annual 'Black Friday' shopping event (FT)

• AI cloud platform CoreWeave aiming for valuation of more than $35bn in its US IPO due next year (RT)

• Tesla cuts China prices; Musk says the next big Full Self-Driving update will be coming soon (RT)

• US prosecution of Indian billionaire Adani has wide economic, diplomatic implications which could hang over Trump presidency (FT)

CENTRAL BANKS

• China's PBoC kept its medium-term lending rate steady, as it seeks to stabilise the yuan after Trump win selloff (CNBC)

• US and Europe central banks' rates trajectories part ways as Eurozone wrestles with sluggish growth (FT)

POLITICS & GEOPOLITICS

• Trump's Treasury Secretary pick Bessent says will focus on tax cut and tariff pledges once he takes office (YH)

• Israel is moving towards a ceasefire agreement in Lebanon with Hezbollah (AX)

• Biden staging final push to deliver more aid to Ukraine, lock in manufacturing subsidies, confirm federal judges (FT)

• Taiwan's defense ministry spots Chinese balloon over the sea to Taiwan's north, the first time in six months (RT)

ECONOMY

• Chinese exports seen reaching historical high this year as customers rush to front-load orders before Trump returns (BBG)

ASX TODAY

• Austal notes Australian government’s selection of LTS100s (eight landing craft heavy vessels) to be built by Austral, subject to negotiations, potential value of the project to order book is to be determined (ASB)

• Delta Lithium Chairman Chris Ellison resigns to focus on MinRes, effective immediately (DLI)

• IVE Group CEO Matthew Aitken discloses sale of 118,000 shares, beneficially owns ~51k shares after the transaction (IGL)

• Newmont sells its Éléonore operation in Northern Quebec, Canada, to Dhilmar Ltd for US$795m in cash (NEM)

WHAT TO WATCH TODAY

• Gold: Gold prices already started to flip negative during Monday's session. Most of our gold miners gave back early strength to finish near worst levels (e.g. NEM +0.5% open, -2.8% close). Nevertheless, gold experienced its worst one-day session since 22-Jun and this will likely place further downward pressure on gold names.

• Energy: Oil prices fell ~3% overnight after reports that Israel and Lebanon have agreed to the terms to end the Israel-Hezbollah conflict. Energy was the worst performing S&P 500 sector overnight (-1.97% vs. all sectors +0.30%).

• Homebuilders: Homebuilder stocks are soaring, with the SPDR Homebuilder ETF up 4.3% overnight and up 8.5% in the last four sessions. Last Friday, US October existing home sales were 3.96m vs. 3.92m consensus. The report noted worst of downturn in home sales could be over, with increasing inventory leading to more transactions. An ASX-listed name like James Hardie is starting to move out towards an 8-month high.

BROKER MOVES

• Guzman y Gomez initiated Hold with $39.30 target

• Lovisa upgraded to Buy from Hold; target cut to $30 from $31 (BP)

Stocks trading ex-dividend: 

• Tue 26 Nov:  Newmont Corporation (NEM) – 0.40%

• Wed 27 Nov: ALS (ALQ) – 1.17%, Graincorp (GNC) – 3.03%, Whitefield Industrials (WHF) – 1.83%

• Thu 28 Nov: Red Hill Minerals (RHI) – 6.90%, Technology One (TNE) – 0.57%

• Fri 29 Nov: Aristocrat Leisure (ALL) – 0.63%, Pengana International Equities (PIA) – 1.15%

Other ASX corporate actions today: 

• Dividends paid: Brickworks (BKW), Global Data Centre Group (GDC)

• Listing: Renerve (RNV) – 12:00 pm, Vitrafy Life Sciences (VFY) – 11:00 am

• Earnings: None

• AGMs: Brickworks (BKW), Pilbara Minerals (PLS), Ramsay Health Care (RHC)

Economic calendar (AEDT):

No major economic announcements.