Market Highlights: AI stocks up as Google unveils ChatGPT's rival Gemini, and 5 ASX small caps to watch

ASX to open lower on Friday despite tech-led Wall Street rally
Alphabet traded 5pc higher after the rollout of Gemini, its new AI tool
We look at how Gemini can outperform ChatGPT

Aussie shares are poised to open lower on Friday, despite a rally on Wall Street. At 8am AEDT, the ASX 200 index futures was pointing down by -0.2%.

Overnight, the S&P 500 rose by +0.8%, the blue chips Dow Jones index was up by +0.17%, and the tech-heavy Nasdaq surged by +1.37%.

US traders reacted to the weak jobs data, which showed that the number of Americans filing new claims for unemployment benefits increased moderately last week. This could signal that higher rates have done the job in curbing the broader economy to a soft landing.

However, experts reminded investors not to be complacent.

“Rate markets priced for deep cuts in early 2024 may get a shock next week if the Federal Reserve reiterates that it will keep interest rates at their peak well into next year,” said Ira F. Jersey and Will Hoffman, strategists at Bloomberg Intelligence.

To stock news, a rally in megacaps spurred speculation the artificial-intelligence (AI) boom will keep fueling market gains.

Alphabet shares surged more than 5% following the rollout of Gemini, its new AI tool. Google executives said Gemini could outperform ChatGPT in some areas (see more below).

Tesla rose 1.43% despite rumours that its Dojo supercomputer project lead, Ganesh Venkataramanan, has left the company. His departure is seen as a setback to the automaker’s self-driving technology efforts.

JetBlue Airways was one of the best stocks overnight, up 15% after narrowing its loss forecast thanks to recent strong travel demand.

Meme stock Gamestop also rose 10% despite a revenue miss in Q3.

How Gemini outsmarts ChatGPT

About a year after OpenAI’s launch of ChatGPT, Google’s Gemini has finally joined the competition.

Gemini is a large language model (LLM) that Google CEO Sundar Pichai says will revolutionise generative technology for business and daily life.

Google claims that Gemini Pro outperforms OpenAI’s GPT-3.5, and that Gemini Ultra outsmarts GPT-4 in most tests of its capabilities such as reasoning, math, and coding.

But according to a report from The Verge, Gemini’s reported performance on those benchmarks is only narrowly better than GPT-4’s.

Google’s real edge over OpenAI however could come if Gemini Ultra is truly multifaceted enough to create original writing and images.

Or if it can come up with arts and crafts projects based on a photo of materials, or explain errors in handwritten equation.

As to what Gemini can do on a web browser, Pichai said it can look at what’s on the web page and answer questions for you, and help you with tasks related to that.

“You can imagine looking at something you want to understand, like a set of figures on a web page, and saying “quickly summarise this for me”.

“All that is now possible. Again, it’s this notion of being an assistant for the user to help them with what they’re doing while they’re browsing the web. All these are possibilities,” Pichai said.

In other markets …

Gold price rose by +0.18 % to US$2,028.54 an ounce.

Oil prices gained 0.57%, with Brent now trading at US$74.43 a barrel.

US 10-year Treasury yield was up 2 basis points to 4.145%.

Iron ore futures rose +1% to US$134.40 a tonne.

The Aussie dollar lifted by 0.77% to US66c.

Meanwhile, Bitcoin fell -0.75% in the last 24 hours to US$43,345.

5 ASX small caps to watch today

Oncosil Medical (ASX:OSL)
The medical device company focusing on pancreatic cancer said the first initial commercial treatments involving the OncoSil device in Greece have just commenced at renowned hospital in Athens. The first two patient treatments completed yesterday see Greece become the third European country – after Italy and Spain – where commercial treatments utilising the OncoSil device have been completed.

Lincoln Minerals (ASX:LML)
Lincoln has increased its Kookaburra Gully Graphite Project (KGGP) resource by 87% to become the second largest graphite resource on the Eyre Peninsula. KGGP’s overall Mineral Resource increased 87% to 12.26Mt at 7.31% total graphitic carbon (TGC). A three-month drill program will now commence, focussed on increasing confidence at the high grade Kookaburra Gully and Koppio deposits.

Queensland Pacific Metals (ASX:QPM)
QPM and Lava Blue have recently completed the first campaign of HPA Demonstration Plant operation, which successfully produced 62 kg, >99.99% of High Purity Alumina (4N HPA).The average purity across blends is approaching 5N (99.999%), far exceeding the 4N threshold. And 6 x ~10kg 4N HPA blends have now been transported to the US to provide to potential offtakers.

Dynamic Metals (ASX:DYM)
Five RC drill holes have been completed to follow up on shallow nickel drilling results from first pass AC program1 at the LP1 and LP2 targets at the Lake Percy Project in the Goldfields Region of WA. Assays are anticipated to be received by end of January 2024, and incorporated into geological model to determine next program of work.

Xanadu Mines (ASX:XAM)
Xanadu reported a substantial increase in the Mineral Resource Estimate (MRE) for its flagship copper-gold project at Kharmagtai, in the South Gobi region of Mongolia. The updated Resource materially increases both the tonnes (12%) and contained copper equivalent (CuEq) metal (13%). This includes a 25% increase in the higher-grade component to >125Mt, which is expected to enhance project cashflows in the early years.

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