Market Wraps

Morning Wrap: ASX 200 to rise, S&P 500 rallies on blowout jobs data, Lithium stocks surge

Mon 07 Oct 24, 8:39am (AEDT)

ASX 200 futures are trading 26 points higher, up 0.31%, as of 8:30 am AEDT.

The S&P 500 and Nasdaq finished the week on a positive note and logged a fourth straight week of gains, US nonfarm payrolls smash analyst expectations and reiterate that the jobs market is in a good place, lithium stocks soared on news that Rio Tinto is looking to acquire Arcadium Lithium and expect a dull session as most of the country is off for Labour Day.

Let's dive in.

Overnight Summary

Mon 07 Oct 24, 8:30am (AEDT)

Name Value % Chg
Major Indices
S&P 500 5,751 +0.90%
Dow Jones 42,353 +0.81%
NASDAQ Comp 18,138 +1.22%
Russell 2000 2,213 +1.50%
Country Indices
Canada 24,163 +0.81%
China 3,336 +8.06%
Germany 19,121 +0.55%
Hong Kong 22,737 +2.82%
India 81,688 -0.98%
Japan 38,636 +0.22%
United Kingdom 8,281 -0.02%
Name Value % Chg
Commodities (USD)
Gold 2,667.8 -0.43%
Iron Ore 108.84 +0.49%
Copper 4.574 +0.46%
WTI Oil 74.38 +0.91%
Currency
AUD/USD 0.679 -0.73%
Cryptocurrency
Bitcoin (USD) 62,640 +1.48%
Ethereum (AUD) 3,594 +1.96%
Miscellaneous
US 10 Yr T-bond 3.981 +3.40%
VIX 19.21 -6.25%

US Sectors

Mon 07 Oct 24, 8:30am (AEDT)

SECTOR % CHG
Financials +1.64%
Consumer Discretionary +1.62%
Communication Services +1.20%
Energy +1.07%
Information Technology +0.99%
Industrials +0.63%
SECTOR % CHG
Materials +0.41%
Consumer Staples +0.23%
Health Care +0.08%
Utilities -0.17%
Real Estate -0.65%

S&P 500 SESSION CHART

S&P 500 intraday
S&P 500 lower, finished off worst levels (Source: TradingView)

OVERNIGHT MARKETS

  • US benchmarks finished higher and near best levels

  • S&P 500 and Nasdaq finished narrowly higher for the week, marking a fourth consecutive week of gains

  • US weekly recap – S&P 500 +0.22%, Nasdaq +0.10%, Dow +0.09%, Russell (-0.54%)

  • Today’s big story – US September nonfarm payrolls almost doubled consensus expectations, sending bond yields sharply higher

  • US 10 year-yield up 12 bps, a fresh two-month high and settled just shy of the key 4.0% level

  • Brent crude eked out a small gain, finishing the week 8.4% higher, marking its best week since March 2023

  • Middle East tensions remain in play, with the market expecting some form of response from Israel after Iran’s missile attack last week

  • Q3 earnings season may be the largest factor in whether the equity-market rally can continue (BBG)

  • China's stock rally may prove to be false dawn, recalling memories of 2015 bust (BBG)

  • Strategists remain sceptical of China's equity prospects (BBG)

  • Rally in US-listed China shares driven more by fresh buying than short covering (BBG)

STOCKS

  • Volkswagen CEO Blume bracing for retaliatory tariffs from China (BBG)

  • Taiwan's Foxconn tops estimates to post highest-ever revenue for the third quarter amid strong demand for AI servers (RT)

  • Cisco to invest in AI cloud-computer provider CoreWeave, part of transaction valuing company at US$23bn (Bloomberg)

  • Apollo nearing deal to acquire aerospace parts maker Barnes Group for more than $45 a share (Reuters)

CENTRAL BANKS

  • Hot September US jobs data sparking widespread second-guessing of Fed's recent cut (CNN)

  • BOJ's pursuit of rate hikes faces challenge as politics and yen outlook complicate the policy outlook (RT)

  • BoE chief economist Pill warns against cutting rates too fast (RT)

  • ECB's Centeno says Eurozone inflation now very near to central bank's 2% target (BBG)

POLITICS & GEOPOLITICS

  • Israel launches multiple airstrikes in Beirut (FT)

  • G7 to warn dangerous cycle of attacks risks fueling uncontrollable escalation in the Middle East (BBG)

  • European Union greenlights imposing tariffs on Chinese EVs in a move set to increase trade tensions with Beijing (BBG)

ECONOMY

  • US September nonfarm payrolls grew 254,000 month-on-month vs. ~145,000 consensus, the largest beat in six months and unemployment rate down to 4.1% (from 4.0%) with no material impact from Hurricane Francine (RT)

  • US dockworkers agree to suspend strike until 15-Jan (BBG)

Industry ETFs

Mon 07 Oct 24, 8:25am (AEDT)

Name Value % Chg
Commodities
Lithium & Battery Tech 46.07 +3.55%
Strategic Metals 47.66 +3.18%
Copper Miners 47.76 +2.25%
Uranium 30.32 +2.23%
Steel 69.76 +0.78%
Silver 29.36 +0.44%
Gold Miners 39.55 -0.03%
Industrials
Global Jets 20.71 +3.34%
Aerospace & Defense 151.8 +0.95%
Construction 78.8158 +0.44%
Agriculture 25.39 -0.63%
Healthcare
Biotechnology 143.9 +0.90%
Name Value % Chg
Cryptocurrency
Bitcoin 17.77 +2.24%
Renewables
Hydrogen 24.22 +1.59%
Solar 42.13 +1.18%
CleanTech 8.11 +1.12%
Technology
E-commerce 28.3 +2.31%
Cloud Computing 20.53 +2.24%
Sports Betting/Gaming 18.91 +1.89%
Electric Vehicles 23.3 +1.66%
Robotics & AI 32.07 +1.62%
FinTech 27.92 +1.60%
Video Games/eSports 76.72 +1.56%
Cybersecurity 30.6 +1.56%
Semiconductor 231.08 +1.37%

ASX TODAY

  • Arcadium Lithium in talks with Rio Tinto about a potential buyout, valuing the lithium miner at US$4-6bn or higher, Arcadium shares up 35% after hours (RT

  • Arcadium Lithium shareholder Blackwattle Investment Partners’ urged the company to reject any bid that doesn’t sit around the US$8bn mark (AFR)

  • Bowen Coking Coal believed to have secured at least $30m as part of a $70m raise to revive the business (The Aus)

  • IPH 15.6m share block trade crosses at $5.40, representing 5.8% of the company

  • SiteMinder holder First Sentier Investors decreases holding to 7.95% from 12.02% (SDR)

WHAT TO WATCH TODAY

  • Low volumes: NSW, ACT, Queensland and South Australia are off for Labour Day, which might result in subdued volumes and stocks just chopping sideways after market open

  • Lithium: Lithium stocks jumped on Rio Tinto's US$5.8bn bid for Arcadium Lithium. While the sector remains a shell of its former self, the bid does offer a valuation floor for the sector. This should see some positive flow for local names, most of which have pullback back over the past two sessions

  • Food for thought – Good news is good news: Lots of solid US economic data in recent days (blowout nonfarm payrolls, four-week moving average initial claims down to lowest since May and ISM services hit a 19-month high). Historic market performance after catalysts such as a Fed cut, a major geopolitical event etc. – All hinges on the state of the economy. In previous Fed rate cut cycles, the S&P 500's median 12-month return after the first cut was 10%. But if the US economy entered a recession, median performance falls to -15%

BROKER MOVES

We have not received any major broker updates.

Key Events

Stocks trading ex-dividend: 

  • Mon 7 Oct: Ridley Corporation (RIC) – 1.82%

  • Tue 8 Oct: Clime Capital (CAM) – 1.65%, Katana Capital (KAT) – 0.42%, MFF Capital Investments (MFF) – 1.83%, Perenti (PRN) – 3.85%, Reece (REH) – 0.65%

  • Wed 9 Oct: Naos Emerging Opportunities (NCC) – 4.65%

  • Thu 10 Oct:  Duxton Water (D2O) – 2.65%, WAM Active (WAA) – 3.43%

  • Fri 11 Oct: Turners Automotive Group (TRA) – 1.28%, WAM Research (WAX) – 4.18%

Other ASX corporate actions today: 

  • Dividends paid: Austin Engineering (ANG), Atlas Arteria (ALX), Cleanaway Waste Management (CWY), Generation Development Group (GDG), Ventia Services Group (VNT)

  • Listing: None

  • AGMs: None

Economic calendar (AEST):

No major economic announcements.

Written By

Kerry Sun

Content Strategist

Kerry holds a Bachelor of Commerce from Monash University. He is an avid swing trader, focused on technical set ups and breakouts. Outside of writing and trading, Kerry is a big UFC fan, loves poker and training Muay Thai. Connect via LinkedIn or email.

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