US stocks fell hard as Fed outlines rate cut plan

There were more investor jitters over interest rates overnight, as minutes from the Fed’s December meeting showed that policymakers had outlined plans to lift rates sooner than expected, and cut its COVID-19 stimulus.

“Almost all participants agreed that it would likely be appropriate to initiate balance sheet runoff at some point after the first increase in the target range for the federal funds rate,” the minutes said.

In December, the Fed had indicated there would be at least three rate cuts in 2022.

The minutes triggered a selloff in tech and real estate stocks, with the Nasdaq falling by 3.3%. The S&P 500 also fell by 1.94%, while the Dow was down 1.07%.

Darling tech stocks like Nvidia and Salesforce were down more than 5%.

In other markets, oil prices gained another 1.5% after a similar rise yesterday, following OPEC’s decision to stick to its planned increased output for February. Spot iron ore price was 2% higher.

Bitcoin meanwhile keeps falling this week, this time by 4% to US$43,985 at 8am AEDT this morning.

In a note written to the Wall Street behemoth’s clients this week, Goldman Sachs’ co-head of foreign exchange strategy Zach Pandl indicated that Bitcoin could grab market share from gold over the next handful of years as a “byproduct” of increasing adoption.

Read the rest of that story here on Coinhead.

 

ASX 200 to open lower on Thursday

The ASX 200 looks set to open lower this morning, with futures markets (January contracts) pointing down by 0.53% at 8:30am AEDT.

Yesterday the benchmark index retreated by 0.3%, driven by a selloff in tech and healthcare stocks.

Tech stocks slumped by almost 3%, following a 1% fall in Nasdaq the night before, and local tech names may come under more pressure today.

Economics data released yesterday afternoon showed that job ads across Australia had fallen by 5.5% amid the Omicron lockdowns, but still remain 37% above pre-COVID levels.

In large cap news this morning, financial group Latitude (ASX:LFS) says that it intends to buy out Humm Group (ASX:HUM)’s consumer business, including its BNPL, instalments and cards businesses, for 150 million Latitude shares and $35 million cash.

5 ASX small caps to watch today

Pharmaxis (ASX:PXS)
New drug development grants from the Australian Government were awarded to two renowned research teams to advance work they are conducting with two Pharmaxis discoveries. The total grant is $1.4m.

Wide Open Agriculture (ASX:WOA)
The company signed a distribution deal with Metro Alliance in Hong Kong to have Dirty Clean Food’s Oat Milk available for purchase in Hong Kong and Macau. WOA says Dirty Clean Food’s Oat Milk is the world’s first oat milk that is carbon neutral, and produced with regeneratively farmed oats.

Musgrave Minerals (ASX:MGV)
Regional exploration RC drilling at Cue continues to intersect further gold mineralisation. Significant intersections include: 2m @ 28.1g/t Au from 78m, and 2m @ 6.1g/t Au from 87m.

Element 25 (ASX:E25)
New record daily production of 1,209 tonnes of concentrate were produced on 3 January 2022 at E25’s Butcherbird Manganese Project. This represents record average daily production of 934 tonnes since 23 December 2021.

Bionomics (ASX:BNO)
The company’s announced full exercise of the underwriters’ option to purchase additional American Depositary Shares (ADSs) in the US. As a result, BNO has issued a further 243,300 ADS’s, each representing 180 ordinary shares of Bionomics. The ADS’s began trading on the Nasdaq Global Market on December 16 2021, under the ticker symbol “BNOX”.