.svg "close (3)"){kind=small}
Image Source: Adobe Stock
Morning Research Notes - 23.07.24
Wall Street staged a robust recovery on Monday, driven by a resurgence in megacap technology stocks. Brent (oil) traded 0.6% lower, with the current price per barrel sitting at $82.12. Spot gold also fell 0.3%, with the current price per ounce standing at $2393.80. Volatility, as measured by the VIX index, decreased by 9.8% to $14.91.
On Monday, Wall Street saw a rebound across major benchmarks following last week's declines, with the S&P 500 and Nasdaq Composite leading gains. The recovery was driven by a resurgence in mega cap technology stocks such as Alphabet, Meta Platforms, and Tesla, which lifted the Information Technology index by 2%. Nvidia also contributed to the positive sentiment, climbing 4.8% on news of its AI chip developments. Investor optimism was tempered by ongoing uncertainties surrounding the U.S. presidential race and upcoming corporate earnings reports, particularly from tech giants like Alphabet and Tesla, which are expected to influence market direction in the near term.
The ASX 200 fell by 0.50% on Friday, with the market experiencing a downward trend, with Utilities decreasing by (0.44%), Materials by (0.86%), Financials by (0.40%), Information Technology by (0.71%), and Health Care by (0.28%). The commodity market also saw a downward trend. Zinc decreased by (2.08%), Copper fell by (0.94%), Aluminium dropped by (2.29%), Nickel declined by (1.58%), and Iron Ore fell by (1.0%).
In other news, Woodside on track to hit guidance, AOFM to release new bond, ANZ left out, Poor China demand hits Iluka Resources. (Source: AFR)
Chart of the day
Despite initial optimism due to the rise of electrification, the nickel price has dropped significantly from over U.S.$30,000 per tonne in early 2022 to U.S.$16,600 per tonne today, largely due to increased production in Indonesia. This has led to the suspension of several nickel operations in Western Australia, including those of IGO Limited and Mincor Resources. BHP has also announced a suspension of its nickel operations until at least February 2027, following a U.S.$3.5 billion write-down. This decision impacts over 2,000 staff and various facilities. The industry’s challenges are underscored by BHP’s unsuccessful attempt to sell its nickel business in 2014 due to closure liabilities and required capital expenditure upgrades. The suspension of BHP’s nickel operations marks a significant downturn for Australia’s nickel industry, less than 60 years after its inception.
Source: Montgomery Investment Management, Livewire markets
If you want to receive our top 3 income stocks click on the button below:
Invest Well,
Australian Stock Report
