Outlook for the day: Tentatively positive as global markets try to find their feet after their recent plunge. Two of Wall Street's three major stock benchmarks finished higher overnight.
ASX futures: up 18 points or 0.23%
Overnight themes:
US stocks mounted a tentative rebound from several weeks of selling after consumer prices grew less than expected and bargain-hunters bought beaten-up growth stocks.
The S&P 500 advanced 0.5% as the three sectors dominated by Big Tech all gained at least 1%. The tech-heavy Nasdaq rallied 1.1%. The Dow edged down less than 0.1% as almost two-thirds of its component companies declined, offsetting gains for Nvidia, Amazon and Microsoft.
Rate cuts were back on the table after headline annual inflation cooled to 2.8% last month from 3% in January as consumer prices increased 0.2%. Core inflation also grew less than economists expected at +0.2% for the month and +3.1% for the year.
Stocks “are higher on the expectation that the Fed could consider additional rate cuts" - Paul Nolte, senior wealth adviser and market strategist at Murphy & Sylvest (per Reuters).
Nvidia led a rebound in chip stocks, bouncing 6.43%. AMD added 4.16%. The Philadelphia Semiconductor Index gained 2.45%. Other notable gains included Tesla +7.6%, Netflix +2.75% and Meta +2.29%. The Nasdaq entered a technical correction on March 6, extending its decline this week from its December peak to almost 14%.
The rally was dominated by growth: the S&P tech sector gained 1.56%, communication services 1.43% and consumer discretionary 1.02%. The only other sectors to post gains were energy +0.44% and financials +0.2%. Drags included consumer staples -2.02%, health -1.02% and materials -0.45%.
Last night's rebound came against a backdrop of escalating tariffs. Donald Trump's 25% steel and aluminium tariffs took effect. Canada announced it will respond with 25% duties on more than US$20 billion of US imports. The European Union said it will hit US$28.33 billion of imports with tariffs next month.
Gold rose as tariff uncertainty supported havens and as cooler US inflation pointed to further interest rate cuts. Gold futures settled 0.9% ahead at US$2,946.80 an ounce. Spot gold was lately up 0.6% at US$2,932.94.
Copper hit a five-and-a-half month high in Shanghai following signs of improved demand and falling inventories in China. Benchmark copper gained 2.08% on the Shanghai Futures Exchange. Elsewhere, benchmark copper firmed 1.31% on the London Metal Exchange to US$9,789 a metric ton. ANZ's Downstream Copper Demand Indicator showed growing demand from manufacturers of electric vehicles and grid infrastructure. "Manufacturers, supported by recent stimulus measures, are ramping up production," ANZ analysts said in a note quoted on Reuters. "Copper cathode inventories in Shanghai and Guangdong extended declines from a peak due to fewer imports in recent months."
Iron ore eased amid speculation that China's state planner will this week release plans to reduce steel production due to overcapacity problems. The National Development and Reform Commission announced on March 5 its intention to reduce output, but did not provide any detail on the scale of the cuts. Benchmark ore declined 0.32% on the Dalian Commodity Exchange to US$106 a metric ton. The Singapore benchmark fell 0.8% to US$99.95 a ton.
Oil rebounded after US data showed a pick-up in demand for gasoline and a drop in inventories. US gasoline inventories shrank by 5.7 million barrels last week, according to the Energy Information Administration. “This phenomenon indicates that energy consumption remains strong, which could sustain prices in the short term,” Antonio Di Giacomo, markets analyst at XS, told MarketWatch.
Key events today:
Inflation expectations - 11 am AEDT
US wholesale inflation (PPI) - tonight
S&P 500: up 28 points or 0.5%
Dow: down 30 points or 0.07%
Nasdaq: up 192 points or 1.1%
VIX: down 10.25% to 24.16
US 10-year treasury yield: up 3.4 points to 4.319%
Dollar: up 0.4% to 63.2 US cents
Iron ore (Dalian): down 0.32% to US$106
Brent crude: up US$1.39 or 2% to US$70.95
Gold (futures): up US$25.90 or 0.9% to US$2,946.80
Gold (spot): up US$18.36 or 0.63% to US$2,933.77
Silver (spot): up 39 US cents or 1.18% to US$32.24
Palladium (spot): up US$3 or 0.32% to US$940.50
Antimony (China ore): up 1.81% to US$17,454
NYSE Arca Gold Bugs: up 0.64%
Bitcoin: up 0.35% to US$83,021
Copper (LME): up 1.31% to US$9,789
Nickel (LME): up 1.46% to US$16,720
Lithium carbonate (China spot battery grade): up 0.39% to 9,142 yuan
Global X Lithium & Battery Tech ETF: up 0.45%
Uranium (spot): down 0.98% to US$62.88
Global X Uranium ETF(URA): up 0.76%
BHP: down 2.85% (US); down 2.36% (UK)
