Market Wraps

Morning Wrap: Dow extends gains, S&P 500 takes a breather, ASX set to fall

Wed 25 Jan 23, 8:28am (AEST)

ASX 200 futures are trading 10 points lower, down -0.14% as of 8:20 am AEDT.

The S&P 500 begins to stall around a tricky trendline, Verizon says payment patterns continue to be very strong, Eurozone PMIs surprise and return to expansion, German consumer sentiment continues to rebound and sectors to watch today include: Yield-sensitive sectors, gold and tech.

Let's dive in.

Overnight Summary

Wed 25 Jan 23, 8:28am (AEST)

Name Value Chg %
Major Indices
S&P 500 4,017 -0.07%
Dow Jones 33,734 +0.31%
NASDAQ Comp 11,334 -0.27%
Russell 2000 1,886 -0.28%
Country Indices
Canada 20,630 -0.01%
China 3,265 +0.76%
Germany 15,093 -0.07%
Hong Kong 22,045 +1.82%
India 60,979 +0.06%
Japan 27,299 +1.46%
United Kingdom 7,757 -0.35%
Name Value Chg %
Commodities (USD)
Gold 1,938.30 +0.50%
Iron Ore 121.94 -
Copper 4.261 +0.09%
WTI Oil 79.91 -2.10%
AUD/USD 0.7045 +0.24%
Bitcoin (AUD) 32,717 -0.27%
Ethereum (AUD) 2,298 -1.42%
US 10 Yr T-bond 3.469 -1.59%
VIX 19 -1.97%

US Sectors

Wed 25 Jan 23, 8:28am (AEST)

Sector Chg %
Industrials +0.65%
Utilities +0.49%
Real Estate +0.40%
Consumer Staples +0.38%
Financials +0.10%
Materials +0.04%
Information Technology -0.04%
Consumer Discretionary -0.17%
Energy -0.22%
Health Care -0.65%
Communication Services -0.69%

We’re looking to simplify some of the overnight stuff – let the tables, charts and headlines do the talking. That said, I'd love to hear from you guys if you prefer this shorter style. If I start getting emails about "this absolutely sucks" then we can revert. Also, a big thank you to all the readers that reached out yesterday about the Morning Brief section.

SPX chart
The S&P 500 is stalling around this key trendline – that’s proven incredibly tricky to break since January 2022 (Source: TradingView)


  • Recent strength can be attributed in part to negative sentiment and positioning dynamics, aligns with the expectation of a weak first-half

  • Recession risk remains present due to factors such as the deeply inverted yield curve, decline in liquidity and Fed’s emphasis on lagging indicators

  • US tech outperformance drawing concern from traders bracing for sector's worst earnings performance since 2016 (Bloomberg)

  • Debt-ceiling crisis could pressure Fed to end QT program sooner (Bloomberg)

  • Crude prices in many of the world's physical markets have rallied recently on more buying from China and concerns Russia could tighten supply (Reuters)


A few interesting macro-related comments from company earnings via StreetAccount:

  • Verizon said payment patterns continue to be very strong and not really seeing anything different from a macro perspective

  • 3M said macro environment remains very fluid and uncertain and expects challenges to persist in 2023

  • GE said net price cost remains positive, talked up broader restructuring and cost saving actions

  • DR Horton said it expects challenging conditions to persist but noted pickup in sales activity in first few weeks of January 


  • Eurozone flash composite PMI surprises, pushes back into expansion (Reuters)

  • German consumer sentiment up for a fourth straight month (Reuters)

  • Japan factory activity falls for a third consecutive month (Reuters)

  • Australian business conditions ease as inflation pressures moderate (Reuters)

Industry ETFs

Wed 25 Jan 23, 8:28am (AEST)

Description Last Chg %
Nickel 37.6799 +2.07%
Aluminum 55.0451 +1.46%
Strategic Metals 92.84 +0.92%
Lithium & Battery Tech 67.6 +0.89%
Silver 21.58 +0.83%
Copper Miners 41.27 +0.56%
Uranium 22.56 +0.40%
Gold 179.63 +0.34%
Steel 65.42 +0.24%
Aerospace & Defense 110.53 +1.56%
Global Jets 20.25 -0.07%
Biotechnology 136.79 -0.01%
Cannabis 12.33 -1.05%
Description Last Chg %
Bitcoin 14.67 -0.31%
Solar 81.61 -1.14%
Hydrogen 13.34 -1.35%
CleanTech 16.73 -1.79%
Sports Betting/Gaming 16.09 +1.31%
Robotics & AI 23.29 -0.30%
Electric Vehicles 23.1 -0.35%
Video Games/eSports 48.61 -0.41%
Cybersecurity 21.69 -0.74%
Semiconductor 404.89 -0.76%
Cloud Computing 17.65 -0.79%
E-commerce 19.54 -1.02%
FinTech 21.82 -1.28%
Last year, I wrote an explainer for our ETF table (includes tickers). You can check it out here.

ASX Morning Brief

We're looking to make the Morning Brief a little sharper and focused on stimulating thoughts about the upcoming session(s) via things like technicals, stocks, broker notes and macro.


The ASX 200's rally has truly been relentless. It's sliced through all these key price points and resistance levels with ease.

  • Up 13 of the last 15 sessions

  • Up 7.8% since 3 January

  • Around 1.9% away from all-time highs

Amid such a V-shaped move, you have to wonder where exhaustion will kick in. Is it around this 7,500 level? Or will it magnet towards those previous all-time highs?

The 20-day moving average is also a potential area of interest and reflects the stock's short-term trend. You'll notice a lot of upward trending stocks rally, come back to the 20-day and repeat. The ASX 200 would need to fall around -2.5% to hit that 20-day.

XJO chart
ASX 200 (Source: TradingView)

Sectors to watch

Not a whole lot happened overnight and SPI future are pointing to a -0.14% fall. If I had to highlight some of the less dull stuff:

Yield-sensitive sectors: The US 10-year Treasury Yield eased overnight after a three day bounce. The S&P 500 saw yield-sensitive sectors like Industrials, Utilities and Real Estate lead to the upside. This also supported the outperformance of the blue-chip Dow, that finished the session up 0.3%.

US10Y 2023-01-25 08-04-58
US 10-year yield (Source: TradingView)

Gold: Spot prices rose 0.35% overnight to a fresh nine month high of US$1,937. Several gold names managed to catch a bid on Tuesday, with notable movers including Ramelius Resources, Newcrest Mining and Evolution Mining.

Tech: Not so much to do with overnight performance but the local tech index (I'm using the ATEC ETF) is trying to work through those October and December lows. On Tuesday, it closed above the 200-day moving average for the first time since January 2022. It's still in a downtrend but does this reflect a) the bottoming of tech and b) a change of character?

Atec chart
Betashares Atech ETF (Source: TradingView)

Food for thought

Breadth thrust: Approximately 61% of S&P 500 stocks have crossed their 200-day moving averages, the highest reading in over a year. "Coming off the December 2018 and March 2020 lows, 10 or more sectors ultimately went on to make golden cross signals. So far, that number has only risen to six, with Growth sectors of Technology, Consumer Discretionary, and Communication Services notably missing from the list," said Rob Anderson from Ned Davis Research.


Key Events

ASX corporate actions occurring today:

  • Trading ex-div: None 

  • Dividends paid: Eildon Capital (EDC) 

  • Listing: None

Economic calendar:

  • 11:30 am: Australia inflation rate

  • 8:00 pm: Germany business climate index

  • 2:00 am: Canada interest rate decision

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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