• The ASX rose by 0.40% on Friday, almost 1% for the week
  • The FOMC will convene for a meeting next week, February 1st
  • Fortescue shares jumped on record quarter

 

Local shares advanced on Friday with the benchmark ASX 200 index rising by 0.40%. For the week, the index was up almost 1%, taking its yearly gain to nearly 8%.

Equities have risen for four weeks in a row as optimism grows that central banks would be pausing rate hikes as inflation drops off.

Next week will be the real test for the market however, with the FOMC convening for its first meeting of the year on February 1st.

The futures market is currently implying a 95% probability of a 25bp increase by the Fed.

It will be a busy week ahead as central banks in the US, UK and EU meet, along with the release of crucial monthly economic data such as US unemployment and EU inflation.

“To a large extent, hopes for a more dovish Fed amid the recent softening of inflation pressures and weak business survey data have fuelled positive risk sentiment in the market,” said a report out of S&P Global Market Intelligence.

“Whether this positivity can be sustained will depend to a large extent on the tone adopted in the upcoming FOMC meeting and post-meeting press conference.”

Meanwhile, the Adani Enterprises stock price took another 5% hit on the Mumbai Stock Exchange today after the scathing report from research firm Hindenburg.

On Wednesday, Hindenburg released a report titled:

“Adani Group: How The World’s 3rd Richest Man Is Pulling The Largest Con In Corporate History”

Back to the ASX, the Energy sector was the main laggard, down by 1.3% while other sectors, led by Tech, were in the green.

Coal stocks mainly fell but Origin Energy (ASX:ORG) was up 1.4% after it corrected its 2025 EBITDA guidance from $350 million to $450 million, to $350 million to $550 million.

Earlier, Fortescue Metals (ASX:FMG) jumped 3% to a record high before closing flattish.

The giant miners reported a huge Q2 with quarterly shipments of 49.4 million tonnes, with half-year shipments of 96.9 mt, up 4% on the pcp. For its full year outlook, the company says it’s targeting iron ore shipments of 187 million tonnes to 192 million tonnes.

Looking ahead to tonight’s session on Wall Street, expect to see US releases including personal income & spending, PCE core deflator and pending home sales.

 

BIG CAP WINNERS

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ResMed (ASX:RMD) rose after reporting revenue growth of 16% on pcp to $1.03 billion for Q2 FY23.

The company also declared a quarterly cash dividend of 44 cents per share, and announced that CEO Michael Farrell will take over the role of Chairman from his father, Peter Farrell.

Bluescope Steel (ASX:BSL) jumped 3% after announcing that it has repaid $US300 million in Euro notes ahead of their May maturity.

At the same time, the company said it increased bilateral loans with 10 banks from $1 billion to $1.3 billion.

 

BIG CAP LOSERS

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Yancoal (ASX:YAN) was the worst performing large cap, down 10% today on no specific news.

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