Morning Wrap: ASX 200 to rise, S&P 500 and Nasdaq at all-time highs, Russell 2000 hits first record since 2021

ASX 200 futures are up 41pts (+0.46%) as of 8:30 am AEST.

In a nutshell:

• S&P 500 and Nasdaq continued to push all-time highs, while the Russell 2000 staged its first record high since November 2021

• Markets focused on favourable historical returns when the Fed resumes cuts, more easing expected in October

• Nvidia rallied 3.4%, while Intel surged 22% on Nvidia investment to develop PC and data centre chips

Let's dive in.

S&P 500 SESSION CHART

S&P 500 higher in a relatively rangebound session (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks higher but off best levels, though S&P 500 and Nasdaq still posted fresh all-time highs

• Small cap Russell 2000 rallied past Nov-21 record close, with Fed easing set to support valuations

• Cyclical pockets of the market and tech/growth themes also performed well

• Nvidia (+3.4%) boosted benchmarks, invested $5bn in Intel (+22.7%)

• Markets focused on historical favourable upside when the Fed resumes rate cuts

• Fed rate cut expected to boost US IPO market, technology and service firms prepare to file (BBG)

• Bond yields rise following Fed rate cut as Powell sticks with cautious approach amid lingering inflation risks (BBG)

• US rate futures lift odds of further easing in October (RT)

• Wall Street shifts from tech to cheaper sectors after Fed's first rate cut since Dec-24 (BBG)

• Chinese tech stocks surge, with Hang Seng Tech Index rallying to four-year high amid Nvidia chip ban (BBG)

STOCKS

• Nvidia to invest $5bn in Intel in a collaboration to develop PC and data center chips (FT)

• Google rolls out Gemini AI integration into Chrome after antitrust win (BBG)

• Hyundai to boost US production in response to tariffs, cuts profit goal (RT)

• Apple's stock bounces as investors focus on higher iPhone prices despite lackluster new features (BBG)

• Apple plans pilot production of a foldable iPhone in Taiwan with mass manufacturing in India by 2026 (RT)

• Meta smart glasses makes market debut, Zuckerberg aiming to replace smartphones with "superintelligence" (FT)

• Google and PayPal enter into multi-year strategic partnership to develop AI shopping experience (BBG)

• Roche to acquire 89bio for up to $3.5bn, enhancing obesity treatment pipeline (BBG)

• ExxonMobil and Chevron expand beyond oil and gas, pursuing LNG projects aggressively (FT)

• Deutsche Bank expects higher Q3 revenue from fixed income and currencies, surpassing analyst forecasts (BBG)

TARIFFS

• UK touts $205bn investments from US firms, including aircraft, AI, quantum, tech projects (BBG)

CENTRAL BANKS

• Bank of England holds rates at 4%, slows quantitative tightening (YF)

• China holds 7-day reverse repo rate as economists weigh potential for easing later this year amid slowing growth (RT)

• BOJ to remain on hold at today's rate decision, with October meeting seen as main focus (BBG)

• Norway's central bank cuts key rate to 4%, signals cautious approach to future monetary easing (BBG)

• ECB Vice President De Guindos suggests rate cuts may continue despite inflation stabilising at 2% (WSJ)

• Brazil's central bank leaves interest rates unchanged as it sticks with patient approach amid inflation risks (BBG)

• Hong Kong Monetary Authority follows Fed in cutting base rate by 25 bp in order to maintain dollar peg (RT)

ECONOMY

• New Zealand GDP contracts by more than expected, strengthening rate cut expectations (BBG)

• Australian employment contracts, but steady jobless rate reinforces expectation of September RBA hold (BBG)

ASX TODAY

• Pretty quiet on the announcement front at the moment

• NextEd Chair Sandra Hook discloses purchase of 238,000 shares (NXD)

• Perseus Mining granted approval for underground development and mining at Yaouré, first ore planned for Jan-26 (PRU)

• Tabcorp reaches settlement with former CEO Adam Rytenskild, agrees to multimillion dollar settlement to avoid time/cost of further litigation (TAH)

WHAT TO WATCH TODAY

• Small caps: The small end of town is all the rage right now. The Small Ords (XSO) has also recently topped its Nov-21 record high. A few names that come to mind amid this small cap rally include BVS, CCP, EOL, FCL, JDO, PPS, QOR, RUL, SDR, SXE etc.

BROKER MOVES

• Orica initiated Buy with $23 target (BP)

• Pro Medicus rated Buy with $350 target (CITI)

• ResMed reiterated Buy; target up to $51 from $49 (CITI)

• Regis Resources downgraded to Sell from Neutral but target up to $5.40 from $4.55 (UBS)

• Telix initiated Buy with $22 target (CITI)

Stocks trading ex-dividend: 

• Fri 19 Sep: Latitude Group Holdings (LFS) – $0.04, Vita Life Sciences (VLS) – $0.045, Wam Income Maximiser (WMX) – $0.003

• Mon 22 Sep: Bisalloy Steel Group (BIS) – $0.165, New Hope Corporation (NHC) – $0.15

• Tue 23 Sep: Ipd Group (IPG) – $0.062, Southern Cross Electrical Engineering (SXE) – $0.05, WT Financial Group (WTL) – $0.005

• Wed 24 Sep: Genesis Energy (GNE) – $0.065, IMDEX (IMD) – $0.01

• Thu 25 Sep: Ambertech (AMO) – $0.006, PRL Global (PRG) – $0.02, Salter Brothers Emerging Companies (SB2) – $0.02, Teaminvest Private Group (TIP) – $0.015, Verbrec (VBC) – $0.001, Wiseway Group (WWG) – $0.006

• Fri 26 Sep: SRG Global (SRG) – $0.03, Veris (VRS) – $0.002

Other ASX corporate actions today: 

• Dividends paid: ASX (ASX), Clinuvel Pharmaceuticals (CUV), Globe International (GLB), Resimac Group (RMC), Tabcorp Holdings (TAH), Australian Ethical Investment (AEF), Sky Network Television (SKT), Fenix Resources (FEX), Yancoal Australia (YAL), Embark Early Education (EVO), Hansen Technologies (HSN), Peet (PPC), Schaffer Corp (SFC), Pinnacle Investment Management Group (PNI), Beacon Lighting Group (BLX), Jupiter Mines (JMS), BSP Financial Group (BFL), Qualitas (QAL)

• Earnings: None

• IPOs: None

• AGMs: None

Economic calendar (AEST):

• 9:30 am: Japan Inflation (Aug)

• 1:00 pm: BoJ Interest Rate Decision (Ests: Hold at 0.5%)

• 4:00 pm: UK Retail Sales (Aug)