Morning traders. Thanks loungers, especially @Ravgnome and @Patterns.
Outlook for the day: Cautiously positive as gains in iron ore and metals help offset a mixed close on Wall Street.
ASX futures: up 24 points or 0.28%
Overnight themes:
US stocks posted minor falls in choppy trade as oil prices retreated and the Trump administration offered mixed messages on progress on its war on Iran.
The S&P 500 eased 0.21% after a morning bounce faded. The Dow Jones Industrial Average shed 34 points or 0.07%. The Nasdaq Composite clung on to a gain of around 0.01%.
Stocks opened underwater, recovered, then faded again as traders tried to make sense of messaging on the Iran war. A day after President Donald Trump declared the war "very complete, pretty much", Defense Secretary Pete Hegseth said yesterday would be "our most intense day of strikes inside Iran". The US military was sending more fighters and bombers than any day of the conflict to date, he added. Adding to the confusion, the White House was forced to walk back a claim by Energy Secretary Chris Wright that the US Navy had escorted a tanker through the Strait of Hormuz. White House press secretary Karoline Leavitt said Wright's tweet was incorrect: "The US Navy has not escorted a tanker or vessel at this time," she told reporters. Stocks turned lower following the correction and continued to fade following reports that Iran planned to deploy mines in the Strait.
"The market was showing some strength and it has given all that back," Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder, told Reuters. "There’s a lot of confusion among investors. You see these headlines coming out of the White House that give the market hope, and then clearer heads prevail and markets realize this is nowhere near over."
Investors were encouraged by oil's rapid retreat from Monday's four-year highs as G7 nations met to discuss releasing emergency oil reserves. Brent crude settled US$11.16 or 11.28% lower at US$87.80 a barrel a day after trading near US$120. Also helping subdue prices: indications the Trump administration might ease sanctions on Russian crude. Oil prices went parabolic on Monday before a sharp reversal. "When you see that type of a parabolic move, whether it's in gold or oil or anything else, you tend to get a pretty violent reversal as soon as you get some news on the other side," Paul Nolte, senior wealth adviser and market strategist at Murphy & Sylvest, told Reuters.
The market leaned on just two sectors for its near-flat finish: tech +0.08% and communication services (Meta, Alphabet) +0.26%. The heaviest drags across the market were energy -1.32% and health -0.73%.
Precious metals rallied as a reversal in oil dampened worries that rising energy prices would force the Federal Reserve to postpone or scrap an anticipated rate cut later this year. The US dollar index eased 0.34% after touching a three and a half month high yesterday. "With oil prices easing from peaks above $100 - still inflationary and therefore supportive for gold, but no longer high enough to seriously limit the Fed’s ability to cut rates - investors are gaining comfort that the debasement trade may be re-energizing as we move on," Bart Melek, global head of commodity strategy at TD Securities, told Reuters (referring to the idea that "hard assets" such as metals can be used as hedges against the debasement of fiat currencies by inflation and excessive money printing). Spot gold was lately up US$56.80 or 1.1% to US$5,196.36 an ounce. Earlier, US gold futures settled US$138.40 or 2.7% ahead at US$5,242.10. Silver and platinum also rose.
Iron ore overcame initial weakness to rise to its seventh straight gain during a time of seasonal demand in China as winter thaws and construction activity picks up. Benchmark ore on the Dalian Commodity Exchange firmed 0.26% in daytime trade to US$114 a metric ton. A report this week showed hot-metal output across the first two months of the year was 1.2% higher than the same period last year.
Copper and other industrial metals rose with the improvement this week in risk appetite. Benchmark copper on the London Metal Exchange rallied 1.1% to US$13,096.50 a metric ton. Aluminium overcame an initial drop of around 3.5% as US officials pushed back against President Donald Trump's claim the conflict could be over soon. Defense Secretary Pete Hegseth said yesterday would be "our most intense day of strikes inside Iran". Meanwhile, Iran said it would determine when the war was over. The most-traded LME aluminium futures contract swung to a gain of 0.43%.
Key events today:
S&P 500: down 15 points or 0.21%
Dow: down 34 points or 0.07%
Nasdaq: up 1 point or 0.01%
VIX: up 0.35% to 25.59
US 10-year treasury yield: up 5.6 points to 4.156%
Dollar: up 0.73% to 71.19 US cents
Iron ore (Dalian): up 0.26% to US$114
Brent crude: down US$11.16 or 11.28% to US$87.80
Gold (futures): up US$138.40 or 2.7% to US$5,242.10
Gold (spot): up US$56.80 or 1.1% to US$5,196.36
NYSE Arca Gold Bugs: up 1.49%
Silver (spot): up US$1.26 or 1.45% to US$88.28
Bitcoin: up 1.75% to US$70,224
Copper (LME): up 1.1% to US$13,096.50
Nickel (LME): up 0.66% to US$17,545
Lithium carbonate (China battery grade): up 2.92% to 20,303 yuan
Global X Lithium & Battery Tech ETF: up 0.84%
Antimony (USA): steady at US$17 per lb
Uranium (spot): down 0.06% to US$85.90
Global X Uranium ETF (URA): up 2.27%
BHP: up 1.37% (US); up 3.8% (UK)
Rio Tinto: up 1.46% (US); up 3.04% (UK)
