Market Highlights: Tech, banks drive Wall Street higher; Generative AI 'worth billions' in Australia

The ASX is set to rebound after another rally on Wall Street
US bank earnings pushed bank stocks higher
Generative artificial intelligence to contribute billions of dollars to Aussie economy

Aussie shares are set to bounce back on Wednesday after another rally on Wall Street. At 8am AEST, the ASX 200 index futures was pointing up by +0.5%.

Overnight, the S&P 500 rose by +0.7% and tech heavy Nasdaq by +1.06% as bank stocks led US bourses higher.

Bank of America climbed almost 4.5% after reporting a Q2 profit jump, while Morgan Stanley surged 6.5% after its Q2 earnings topped expectations.

Bank of America’s CEO Brian Moynihan said “we continue to see a healthy US economy that is growing at a slower pace, with a resilient job market.”

Charles Schwab however was the best performer, up by 12.5% as the company’s EPS (earnings per share) beat estimates.

The next big name to report results this week is Netflix, which is due later tonight (US time).

Meanwhile most AI (artificial intelligence) related stocks also rallied overnight, including Nvidia and Microsoft.

Billion of dollars to be unlocked by Generative AI

A recent research report suggests GAI (generative artificial intelligence) could unlock billions of dollars in value by 2030 in Australia.

The report, Australia’s Generative AI Opportunity, is a collaboration between Microsoft and the Tech Council of Australia.

It shows that GAI could contribute between $45 billion and $115 billion a year to Australia’s economy by 2030 through two major channels: improving existing industries, and enabling the creation of new products and services.

Professional and financial services are identified as one of the four key sectors of the Australian economy that are poised to benefit from GAI.

The report demonstrates that the technology could contribute between $5 billion and $13 billion annually to the sector in Australia by 2030.

The other three key sectors identified in the report were healthcare, manufacturing and retail.

In other markets …

Gold rose 1.25% overnight to US$1,978.95 an ounce, hitting a four-week high.

Analysts believe that gold’s rebound will have to take a break until we know for sure the Fed is done raising rates at the July 26 FOMC meeting.

Crude oil prices also rallied by over 2%, with WTI now trading at US$75.85 a barrel as China said it will act to support economic growth.

Bitcoin meanwhile was down -1.4% in the last 24 hours to US$29,790.

Data shows that BTC’s negative correlation with the US dollar index (DXY) has broken in recent weeks following the recent selloff in greenback.

“The negative relationship between DXY and BTC is likely to return, as gyrations in the dollar index influence global liquidity conditions, which in turn affect valuations in risk assets, including cryptocurrencies,” said Noelle Acheson, former head of research at CoinDesk.

5 ASX small caps to watch today

Brainchip Holdings (ASX:BRN)
Brainchip announced the issue of another US patent, strengthening its patent portfolio. The patent protects BrainChip’s neuromorphic processor, which is configured to perform convolutions on digital input data that has been converted into spikes. Importantly, the patent broadens the scope of protection already granted to BrainChip in one of its earlier patents, further enhancing the commercial value of the patent.

Echo IQ (ASX:EIQ)
Artificial Intelligence company Echo IQ announced the expanding use of the AI-backed EchoSolv technology to include the identification of disease progression for the most common heart valve abnormality, Mitral Regurgitation. The new solution development is now complete, and will be available from August. Meanwhile, sales pipeline for EchoSolv continues to grow with new deployments pending

Mandrake Resources (ASX:MAN)
Mandrake has secured 181km2 of modern 3D seismic incorporating much of its Utah Lithium Project. 3D seismic provides detailed structural information, allowing Mandrake to identify potential migration pathways for relatively high concentration lithium-rich brines. Once tied in with existing historic well logs, 3D seismic will enable Mandrake to target and then correlate known lithium brine reservoirs across vast areas of the project, assisting with the compilation of JORC Mineral Resources.

Apollo Minerals (ASX:AON)
Apollo reported visible gold in quartz veins in two separate locations 100m apart at the new Keri permit within the company’s 100% owned Kroussou project in Gabon. Quartz veins with associated iron and base metal sulphides were identified in insitu samples from a separate prospective zone 2.7km southwest of the visible gold quartz veins.

VRX Silica (ASX:VRX)
VRX has been granted its fourth silica sand mining lease at its new Arrowsmith Brand Silica Sand Project, which is located 270km north of Perth in the VRX Silica Arrowsmith Silica Sand Projects precinct. The mining lease includes a portion of the previously announced Arrowsmith Brand Resource of 523Mt @ 97.3% SiO2. It includes Mineral Resource Estimate for silica sand within the mining lease boundary of 312Mt @ 97.2% SiO2.