Market wraps 13th March 2024

Morning Bell - Sam Kanaan

Wall St closed higher overnight as stocks resumed the recent rally after key inflation data came in-line with expectations. The Dow Jones climbed 0.61%, the S&P500 traded 1.12% higher and the tech-heavy Nasdaq rose 1.54%. Investors took confidence in the slight rise in inflation through the latest CPI data, indicating core inflation rose 0.4% in February from January and 3.8% year-on-year, while the inflation rate in the US rose just 0.1% to 3.2% in February.

Over in Europe, markets closed higher in the region as investors responded to the latest US inflation data report. The STOXX600 rose 1% driven by automotive stocks while Germany’s DAX rose 1.23%, the French CAC added 0.84% and, over in the UK, the FTSE100 gained 1.02% on Tuesday.

British unemployment rate data came out yesterday indicated a rise to 3.9% for January from 3.8% in December and slowing wage growth which provide further supportive evidence for interest rate cuts to come.

Locally yesterday, the ASX ended Tuesday’s rollercoaster session 0.1% higher after a morning rally was overturned in midday trade by a US-inflation data fear driven sell off, before settling the day up 0.1%. Gains were led by the information technology and utilities sectors which rose 1.15% and 0.88% respectively. This was offset by the energy sector which lost 0.77%.

What to watch today:

  • The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.18% at market open this morning.
  • On the commodities front this morning,
    • Oil is trading 0.16% higher at US$78.05 cents a barrel following OPEC’s optimistic outlook on global oil demand growth in 2024 and 2025.
    • Gold is trading 1.1% lower at US$2158 an ounce, following US inflation data coming back slightly above expectations.
    • And iron ore is trading down 5.96% to US$110.50 a tonne following subdued demand in China causing a cautious approach among steelmakers who are hesitant on restocking supply.

Trading Ideas:

  • Bell Potter has maintained a buy rating on Telstra Group (ASX:TLS) and has an unchanged 12-month price target of $4.25. The buy rating is maintained by Bell Potter as the FY24 results are seen as a potential catalyst to meet the guidance with the highlights being continued strong growth in the core mobile and infrastructure businesses and signs of some turnaround in Enterprise.
  • And Trading Central has identified a bullish signal in GUD Holdings (ASX:GUD), indicating that the stock price may rise from the close of $11.42 to the close of $13.40-$13.90, on a pattern formed over 25 days according to the standard principles of technical analysis.