1st February 2024

Morning Bell - Sam Kanaan

Wall St closed lower overnight, following the announcement from Federal reserve chairman Jerome Powell that the US central bank will not be likely to cut rates in March. The Dow Jones lost 0.82%, the S&P 500 fell 1.61% and the tech-heavy Nasdaq ended the day 2.23% in the red.

In terms of US stocks, Alphabet fell more than 6% following disappointing ad revenue results overshadowed better than expected earnings and sales.

Over in Europe, markets closed marginally higher as corporate earnings continues. The STOXX600 ended the day 0.1% higher with autos stocks up 1.1% whilst retail stocks fell 2.1%.  Germany’s DAX closed 0.40% lower, the French CAC ended the trading day down 0.27% and over in the UK the FTSE100 fell just under half a percent.

Locally yesterday, markets rallied following the release of important inflation data which saw the monthly CPI indicator slow to 3.4% in December, 0.2% lower than the forecast. Markets closed just over 1% higher yesterday with all major sectors finishing in the green. The biggest gains were made by the real estate and utilities sectors which gained 2% and 1.70% respectively.

What to watch today:

  • The Australian share market is set to open lower, with the SPI futures suggesting a fall of just over 1% at market open this morning.
  • On the commodities front this morning,
    • Oil is trading down 2.8% to US$75.67 a barrel after Chinese manufacturing activity contracted for the fourth consecutive month.
    • Gold is down 0.11% to US$2033 an ounce, following the announcement that US interest rates will remain steady.
    • And iron ore is trading 1.81% lower at US$136 a tonne.

Trading Ideas:

  • Bell Potter maintains a buy rating on Select Harvests (ASX:SHV) and has increased its 12-month price target on the almond producer to $4.70. The buy rating is maintained by Bell Potter, following firming in the USD almond pricing and solid crop production forecasts for the upcoming season set to uplift the EBITDA over FY24-FY25.
  • And Trading Central has identified a bullish signal in Stockland Corp (ASX:SGP), indicating that the stock price may rise from the close of $4.56 to the range of $4.74-$4.78 over 25 days, according to the standard principles of technical analysis.