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Morning Research Notes - 30.09.24
On Friday, Wall Street closed higher, with the Dow Jones Industrial Average reaching a record high, driven by a surge in energy stocks and positive inflation data. Commodities experienced mixed performance on Friday: Spot gold decreased by 0.5%, settling at US$2,658.24 per ounce. Brent crude rose by 1.1%, bringing its price up to US$72.41 per barrel. Iron ore continued its upward momentum, rising by 4.4% to US$102.85 per tonne.
Wall Street gained on Friday, with the Dow Jones Industrial Average reaching a record high of 42,313.00, gaining 137 points (0.3%). A surge in energy stocks was partly responsible for this rise as oil prices increased amid escalating tensions in the Middle East. Despite a slight decline in tech stocks, investor sentiment was boosted by signs of cooling inflation, with the headline PCE index rising only 0.1% in August. US consumer spending grew by 0.2%, slower than expected, while household income growth also slowed.
Australian markets experienced gains on Friday, with the ASX200 closing 0.10% higher. This trend of mixed performance was evident across major indices. The materials and information technology sectors ended the day positively, closing at 2.78% and 0.4% higher respectively. In contrast, the financials, health care, and utilities sectors closed at 0.63%, 1.32%, and 0.73% lower, respectively. Commodities traded relatively flat, with Zinc and Nickel prices remaining unchanged, while Aluminium ended the day 4.38% higher and Copper closed 0.45% lower.
Chart of the day
An often overlooked yet highly undervalued sector is healthcare. Healthcare can provide a solid opportunity for defensive diversification. The sector is typically resilient during economic downturns, as demand for medical services and products tends to remain constant. Investing in healthcare can offer a safeguard against market volatility that taps into long-term growth driven by ageing populations, technological advancements and ongoing innovation. Morningstar research shows that nearly 50% of healthcare stocks are rated 4 or 5 stars, indicating they're trading below intrinsic value.
Source: Livewire, Playton
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