Morning Wrap: ASX 200 to slip, S&P 500 and Nasdaq at record highs, Focus shifts to US CPI

ASX 200 futures are down 20pts (-0.22%) as of 8:30 am AEST.

In a nutshell:

• S&P 500 and Nasdaq both hit record highs as Oracle shares surged more than 30%

• Wall Street expects a hot inflation report tonight, though most analysts expect a modest stock reaction

• Gold miners rallied overnight, while lithium stocks tried to stabilise

Let's dive in.

S&P 500 SESSION CHART

S&P 500 higher but off best levels (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks mixed, defensive Dow and small caps underperformed, indices faded early gains

• S&P 500 and Nasdaq still logged all-time highs 

• Today’s big story – Oracle shares surge 35.9% after quarterly report noted a 359% year-on-year increase in contract backlog to $455 billion, now the 10th largest company on the S&P 500

• Equal-weight S&P 500 (-0.10%) underperformed the official benchmark by 40 bps – interesting contrast to see Equal-weight on a three-day losing streak vs. S&P 500 on a three-day winning streak   

• Wall Street forecasts hot CPI report, expects modest stock reaction amid job market focus (BBG)

• Traders building bullish positions in Treasuries ahead of CPI data (BBG)

• Wall Street boosts S&P 500 targets amid strong earnings and AI enthusiasm, with some targets as high as 7,000 points (BBG)

• Barclays lifts 2025 S&P 500 target to 6,450, on strong earnings and AI optimism (RT)

• Bond markets bet on deeper Fed rate cuts, with some seeing rate below neutral to spur growth and avert recession (BBG)

• Hedge funds increase bullish yen bets after BOJ hints at potential rate hikes (BBG)

• Japan equities rally continues after PM resignation, but rising bond yields a threat (NK)

• China bond market selloff persists, with 30-year yield reaches highest level since November 2024 (BBG)

• Korean benchmark nears record high, driven by tech momentum, corporate reform, and shareholder-friendly policies (BBG)

STOCKS

• Oracle highlights massive increase in bookings and bullish outlook for cloud infrastructure division (BBG)

• Larry Ellison overtakes Elon Musk as richest man in the world (YF)

• OpenAI signed contract with Oracle to purchase $300bn in computing power over five years (WSJ)

• Apple unveils thinnest iPhone 17 Air, compromises on battery and camera (BBG)

• Microsoft to buy Anthropic's AI technology for use in its Office 365 apps (TI)

• Google Cloud has $106bn in customer commitments, with over 55% expected to generate revenue in two years (BBG)

• TSMC reports 34% revenue increase in August, exceeding expectations amid strong demand for AI silicon (BBG)

• Novo Nordisk cuts 9,000 jobs, cuts profit forecast amid fierce competition (BBG)

• ExxonMobil anticipates EU will sign long-term US gas contracts for American energy purchases (FT)

• Salesforce CEO aims for double-digit sales growth (BBG)

• GameStop's profit surged in Q2 with over 20% sales increase, driven by collectibles and hardware (RT)

• Klarna IPO more than 20x oversubscribed, raising $1.37bn above marketed range (BBG)

• Zara's Inditex reports weaker Q2 sales, sees growth in August (BBG)

TARIFFS

• Trump has asked the EU to impose 100% tariffs on India and China, US prepared to mirror any tariffs imposed by the EU on those countries (CNBC)

• Trump and Modi commit to resuming trade negotiations, signaling potential thaw in US-India relations (BBG)

CENTRAL BANKS

• US judge temporarily blocks Trump from firing Fed Governor Cook (AX)

• Bessent flags BLS revision in calling Fed to change policy stance (BBG)

ECONOMY

• US August producer prices down 0.1% month-on-month vs. consensus for a 0.3% increase, annualised headline up 2.6% vs. 3.3% consensus (BBG)

• Fitch Ratings raises 2025 world growth outlook, citing improved prospects for China and Europe (WSJ)

ASX TODAY

• Brickworks, Soul Patts shareholders approve merger scheme, implementation expected 23-Sep (SOL)

• Newmont applies for delisting on TSX, to remain on the NYSE, ASX and PNGX exchanges (NEM)

• Perenti secures $300m Dalgaranga contract over 48 months (PRN)

• Ridley Corp major shareholder AGR Partners sells down ~5% stake via $54.4m block trade at $2.90 or 3.9% discount to last close (AFR)

WHAT TO WATCH TODAY

• Gold: Gold prices ticked 0.43% overnight to a record close of US$3,641/oz. Outsized response from VanEck Gold Miners ETF (+2.4%), could see some positive flows for local names.

• Lithium: Lithium stocks obliterated on Wednesday, with Liontown (-18.4%) and Pilbara Minerals (-17.2%). Overnight names like SQM and Albemarle both up around 1%. Will be interesting to see if local names can stabilise.

BROKER MOVES

• Amcor initiated Buy with $16.50 target (GS)

• Dalrymple Bay Infrastructure upgraded to Outperform from Sector Perform; target remains $4.70 (RBC)

• Qoria initiated Buy with $0.72 target (GS)

Stocks trading ex-dividend: 

• Thu 11 Sep: Air New Zealand (AIZ) – $0.01, Austin Engineering (ANG) – $0.009, Bhagwan Marine (BWN) – $0.005, Breville Group (BRG) – $0.19, CAR Group (CAR) – $0.415, Comms Group (CCG) – $0.001, Cti Logistics (CLX) – $0.055, Earlypay (EPY) – $0.007, Freightways Group (FRW) – $0.191, Joyce Corporation (JYC) – $0.17, Kogan.com (KGN) – $0.07, McMillan Shakespeare (MMS) – $0.77, Navigator Global Investments (NGI) – $0.047, Nine Entertainment (NEC) – $0.53, NZME (NZM) – $0.027, Pepper Money (PPM) – $0.064, Perpetual (PPT) – $0.54, SGH (SGH) – $0.32, Westgold Resources (WGX) – $0.03, WCM Global Growth (WQG) – $0.021, XRF Scientific (XRF) – $0.045

• Fri 12 Sep: Ariadne Australia (ARA) – $0.005, CAR Group (CAR) – $0.415, Cleanaway Waste Management (CWY) – $0.032, Experience Co (EXP) – $0.003, G8 Education (GEM) – $0.02, Wisetech Global (WTC) – $0.119

• Mon 15 Sep:  Alfabs Australia (AAL) – $0.017, Credit Corp Group (CCP) – $0.36, Data#3 (DTL) – $0.15, EUROZ Hartleys Group (EZL) – $0.035, Fleetwood (FWD) – $0.135, Guzman Y Gomez (GYG) – $0.126, Kelsian Group (KLS) – $0.095, L1 Long Short Fund (LSF) – $0.065, Lovisa (LOV) – $0.27, Pengana Capital Group (PCG) – $0.02, Qube (QUB) – $0.057, Ramelius Resources (RMS) – $0.05, Saunders International (SND) – $0.003, Sports Entertainment Group (SEG) – $0.01

• Tue 16 Sep: Duratec (DUR) – $0.025, Qantas (QAN) – $0.264

• Wed 17 Sep: Auckland International Airport (AIA) – $0.063, Count (CUP) – $0.028, Flight Centre (FLT) – $0.29, Inghams Group (ING) – $0.08, Maas Group (MGH) – $0.035, Supply Network (SNL) – $0.38, Service Stream (SSM) – $0.03

• Thu 18 Sep: a2 Milk Company (A2M) – $0.089, Centrepoint Alliance (CAF) – $0.018, Cochlear (COH) – $2.15, Embelton (EMB) – $0.20, Lycopodium (LYL) – $0.25, Macmahon Holdings (MAH) – $0.01, Mader Group (MAD) – $0.048, NRW Holdings (NWH) – $0.095, PWR Holdings (PWH) – $0.02, SKS Technologies (SKS) – $0.05, South32 (S32) – $0.04, Tourism Holdings Rentals (THL) – $0.036

• Fri 19 Sep: Latitude Group (LFS) – $0.04, Vita Life Sciences (VLS) – $0.045

Other ASX corporate actions today: 

• Dividends paid: None

• Earnings: None

• IPOs: None

• AGMs: None

Economic calendar (AEST):

• 11:30 am: China Inflation (Aug)

• 10:30 pm: US Producer Price Index (Aug)