Morning Wrap: ASX 200 to rise, S&P 500 at record highs + Copper, nickel and lithium stocks set for further gains

ASX 200 futures are up 29pts (+0.33%) as of 8:30 am AEDT.

In a nutshell:

• S&P 500 and Russell 2000 closed at record highs, while the Nasdaq is within 2% of 29-Oct-25 all-time high

• Commodity prices bounced after Thursday's broad pullback, notable gains from nickel (+4.3%), silver (+3.8%), copper (+1.4%) and gold (+0.70%)

• US December nonfarm payrolls rose less than expected, unemployment rate slipped to 4.4% vs. 4.5% consensus

Let's dive in.

S&P 500 SESSION CHART

S&P 500 trended higher to close near best levels (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks higher and closed near best levels

• S&P 500 and Russell closed at record highs, Nasdaq less than 2% from record highs

• US weekly recap: Russell 2000 (+4.62%), Dow (+2.32%), Nasdaq (+1.88%), S&P 500 (+1.57%) 

• Commodity prices bounced after Thursday’s broad pullback, with nickel up 4.3% to US$17,689/t, copper up 1.4% closing just shy of US$6.0/lb, aluminium up 1.9% to the highest since Apr-22 and silver up 3.8%, capped off 9.7% weekly gain

• Market’s path of least resistance remains higher off the back of more reasonable positioning and sentiment, a broadening rally and cyclical outperformance, Trump focus on affordability via rates, housing and mortgages and cooling Venezuela tensions

• Mag-7 dominance may be fading as earnings growth slows and AI capex continues to soar (BBG)

• Companies tap bond market at fastest pace since pandemic, setting up record year of debt sales (FT)

• Hedge funds looking for opportunities around Venezuela, Cuba, Greenland as Trump seeks to dominate Western hemisphere (WSJ)

• Asian tech stocks rally to start the year on AI demand optimism and more reasonable valuations (BBG)

• Many investors betting on further gains in gold, flagging waning confidence in developed market currencies and further central bank buying (BBG)

• Investors pivot out of tech into cyclicals and defence as economic reacceleration hopes drive broadening market rally (WSJ)

STOCKS

• Merck in talks to buy Revolution Medicines for up to $32bn (FT)

• Walmart and Google announce collaboration to search and buy products through Gemini (CNBC)

• Boeing on track to report highest number of deliveries since 2018, set to ramp output further (CNBC)

• TSMC revenue beats estimates, bolstering hopes for continued global AI spending in 2026 (BBG)

• Nvidia-backed Lambda seeks $350m pre-IPO funding to support 2H26 IPO plans (TI)

• J&J strikes deal with Trump to lower drug prices, gains tariff exemptions (WSJ)

• GM discloses $7bn hit from EV transition and China restructuring challenges (FT)

TARIFFS

• Importers prepare for possible $150bn tariff refund, pending Supreme Court ruling on tariffs (RT)

• Taiwan-US trade surplus to hit record high as trade deal negotiations continue (BBG)

CENTRAL BANKS

• BOJ to raise growth forecasts at January meeting due to PM Takaichi stimulus package (BBG)

GEOPOLITICS

• Trump cancels second Venezuela attack, citing improved cooperation (FT)

• Venezuela does not give Beijing precedent over Taiwan, 'but it is up to Xi', says Trump (RT)

• Nearly 20 oil execs to meet Trump about rebuilding Venezuela's energy sector, Trump flags $100bn investment (BBG)

• Trump signs executive order to safeguard Venezuelan oil revenue in US Treasury account (BBG)

ECONOMY

• US December nonfarm payrolls increased by 50,000 vs. 60,000 consensus, unemployment rate was 4.4% vs. 4.5% consensus (BBG)

• US January consumer sentiment improves to 54.0 vs. 52.9 in December and 53.5 consensus, highest reading since September and up for a second straight month (BBG)

• Trump says he will cap on credit card rates of 10% for one year (POL)

• China's CPI accelerates to 0.8% year-on-year, led by food costs, but deflationary risks persist (BBG)

ASX TODAY

• ASX 200 set to open higher, a rather encouraging lead from Wall Street that featured solid breadth and Materials as the best performing S&P 500 sector. Price action continues to be rather dicey (e.g. XJO closed -0.03% on Friday vs. intraday high of +0.48%). But the index continues to trade on the right side of key moving averages (above the 20, 50 and 200 day) and still marking higher highs.

• Boss Energy holder Sprott Inc. increases holding to 12.1% from 9.1% (BOE)

• Light & Wonder to compensate Aristocrat Leisure for $127.5m for infringement of IP relating to Dragon Train game (LNW)

• Rio Tinto and Glencore to hold buyout talks to create $207bn mining giant (FT)

• Southern Cross Media holder 19 Cashews lowers holding from 14.4% to 7.5% (SXL)

WHAT TO WATCH TODAY

• Homebuilders: SPDR S&P Homebuilders ETF up 5.1% overnight, now up 9.1% in the last two sessions to the highest since 19-Sep-25. Trump called on Fannie and Freddie to buy US$200bn in mortgages, driving broad rally for housing-related stocks. NYSE-listed James Hardie shares up 6.1% overnight to highest since 20-Aug-25, likely to see strength follow through today for other US housing exposed names like REH, RWC, GWA etc.

• Miner gains: Broad-bounce for most commodities overnight after last week's pullback (e.g. PLS -3.1% and NIC -4.6% on Friday vs. Rare Earth/Strategic Metals and Nickel Miners ETF both up 3.0% overnight).

BROKER MOVES

• Ramelius Resources upgraded to Buy from Neutral; target up to $5.35 from $4.30 (GS)

• Vault Minerals downgraded to Neutral from Buy; target up to $6.30 from $5.27 (GS)

Stocks trading ex-dividend: 

• Mon 12 Jan: Dominion Income Trust (DN1) – $0.561

• Tue 13 Jan: Sandon Capital (SNC) – $0.005

• Wed 14 Jan: Tower (TWR) – $0.144

• Thu 15 Jan: None

• Fri 16 Jan: None

Other ASX corporate actions today:       

• Dividends paid: None

• Earnings: None

• IPOs: Unity Metals (UM1) at 12:00 pm

• AGMs: None

Economic calendar (AEDT):

• 11:30 am: ANZ-Indeed Job Ads (Dec)