Morning Wrap: ASX 200 to rise, S&P 500 higher on solid bond auction and inflation data

In a nutshell:

• US stocks broadly higher on solid US 30-year bond auction, cooler-than-expected produce price data

• Oracle shares surge 13% after revenue guidance smashes analyst expectations, fueling confidence in broader AI sector

• Gold miners set to rally, Accent Group guides to weaker-than-expected FY25 EBIT

Let's dive in.

S&P 500 SESSION CHART

S&P 500 higher, closed near best levels (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks higher, finished near best levels

• Bond yields broadly lower after strong 30-year bond auction, with the US 10-year yield down 5 bps to 4.36%

• Today’s big story – Cooler-than-expected US producer price data, strong bond auction and lower yields drove stocks higher, though US trade talks with Japan, India and EU appear somewhat challenging

• Strong 30-year bond auction eased worries that investors would shun the US government's longest maturity (BBG)

• Investors pivoted funds from US stocks to Europe and EMs in May amid weaker dollar, deficit concerns (RT)

• Japan share buybacks in 2025 taking place at record clip as companies look to improve returns (NK)

• Goldman Sachs trims next 12 months recession odds on easing trade uncertainty (RT)

STOCKS

• AMD CEO says their latest AI processors can challenge Nvidia (BBG)

• Boeing shares tumble after Air India plane crashes at Ahmedabad airport (BBG)

• Oracle shares surge 13% after revenue guidance tops expectations amid strong growth in cloud infrastructure business, doubling of orders (BBG)

CENTRAL BANKS

• Reserve Bank of India’s outsized 50 bp rate cut and shift back to neutral stance sows confusion for markets (BBG)

TARIFFS & GEOPOLITICS

• US-India trade negotiators hardening stance, with disagreements on issue such as genetically-modified crops, medical devices and data localisation policies (BBG)

• Trump says he'll set unilateral tariffs in the next one or two weeks (BBG)

• Trump open to extending July tariff deadline, but does not think will be needed (RT)

• China affirmed its trade deal with Trump, emphasising need for both sides to honor agreement (RT)

• Japan PM Ishiba sees large gap between US and Japanese stances on trade talks, won't rush into a quick deal (BBG)

• Vietnam's trade minister engages Nike and Walmart executives to strengthen ties ahead of key trade negotiations (BBG)

• Trump set to finalise a US-UK trade deal, lowering tariffs on British cars for US agricultural access (FT )

• Israel may take military action against Iran soon, likely without US support (CBS)

• Sixth round of negotiations between US and Iran set for Sunday (NBC)

ECONOMY

• US May core producer prices up 0.1% month-on-month vs. 0.3% consensus, annualised core of 3.0% below 3.1% consensus and lowest since Aug-24 (BBG)

• US Treasury recorded record $23bn in tariff revenue or a 270% increase in May, which may offset deficit in the month (BBG)

• UK GDP contracted 0.3% in April, first decline in six months due to sharp tax increases and tariffs (BBG)

• Australia inflation expectations hit 5.0% in June, highest since July 2023, according to survey (BBG)

ASX TODAY

Don't forget to check out our Live Blog for the latest market updates, insights and analysis.

• Accent Group guides FY25 EBIT of $108-111m vs. $113m consensus, like-for-like sales for the first 23 weeks ended 8-June down 1% (AX1)

• Dalrymple Bay Infrastructure block trade, largest shareholder Brookfield sold 23% of company at $3.72 per share or a 7.9% discount to last close (AFR)

WHAT TO WATCH TODAY

• Another record close on the cards: The ASX 200 will have a crack at record highs thanks to a strong lead from Wall Street. Volatile tariff headlines likely offset by solid producer price print and bond auction.

• Gold: Gold prices continued to rally overnight, driving a 3.0% gain for the VanEck Gold Miners ETF (GDX), which is now within 1% of recent highs. This should drive further gains for local names, most of which rallied 2-5% on Thursday.

• Accent Group, Dalrymple Bay: Accent has guided to a massive EBIT miss vs. a few analyst forecasts (e.g. Citi has FY25e EBIT at $148m). This should drive considerable downside to the stock. Meanwhile, Dalrymple's block trade was conducted at a sizeable discount, but this makes the stock's dividends yield higher, which may attract some income-oriented buyers. Brookfield also says the sale increases the free float, making the stock more likely to join the ASX 200

BROKER MOVES

• Cettire downgraded to Sell from Hold; target cut to $0.28 from $0.475 (BP)

• Endeavour Group initiated Hold with $4.50 target (BP)

• Goodman Group initiated Buy with $39 target (GS)

Stocks trading ex-dividend: 

• Fri 13 Jun: Dyno Nobel (DNL) – $0.024, Plato Income Maximiser (PL8) – $0.006

• Mon 16 Jun: Whitefield Income (WHI) – $0.006

• Tue 17 Jun: None

• Wed 18 Jun: Aft Pharmaceuticals (AFP) – $0.011

• Thu 19 Jun: None

• Fri 20 Jun: None

Other ASX corporate actions today: 

• Dividends paid: Technology One (TNE)

• Earnings: None

• IPOs: None

• AGMs: None

Economic calendar (AEST):

No major economic announcements.