• ASX to rise as Wall Street rallies
  • Fed minutes reveal plan to rise rates by 50bp over the next two months
  • Appen gets takeover offer

 

Local shares are poised to open higher this morning following a broad based rally on Wall Street overnight.

At 8.30am AEDT, the June ASX 200 futures was pointing up by 0.18%.

US stocks rose after minutes from the Fed’s May meeting revealed that Fed officials agreed to hike rates by 50bp over the next two months, in line with market expectations.

“Most participants judged that 50 basis-point increases in the target range would likely be appropriate at the next couple of meetings,” the minutes read.

Investors were previously concerned about a possible front loading move, whereby the Fed increases its rates by a larger percentage at the early stages to control inflation.

Famed economist and Nobel prize winner Joseph Stiglitz however told Bloomberg that increasing rates isn’t the best solution to tackle inflation.

“Raising interest rates is not going to solve the problem of inflation,” he said at the World Economic Forum in Davos.

“It’s not going to create more food. It’s going to make it more difficult because you aren’t going to be able to make the investments,” he said.

Meanwhile, US natural gas surged above $US9 per million British thermal units overnight, the highest since 2008. US LNG prices have risen by more than 130% this year, exacerbated by a warmer summer and the war in Ukraine.

“Gas is being forced to fulfil a significantly greater portion of power burn during a summer that looks to top records for electricity load,” OTC Global’s Campbell Faulkner told CNBC.

To crypto news, where Bitcoin is trading steady at US$29,750 at 8am AEDT.

A prominent Silicon Valley VC  announced that it has raised a stupendous US$4.5 billion for a new crypto fund – its fourth and the biggest the industry has seen so far.

In a timely confidence boost for the market, the new Crypto Fund 4 more than doubles the size of a similar fund a16z raised in June last year, and completely eclipses rival VC Paradigm’s massive US$2.5 billion crypto fund announced in November.

Read the full story here on Stockhead.

 

5 ASX small caps to watch today

Appen Ltd (ASX:APX)
Following media reports, Appen has confirmed that it has received a non-binding takeover proposal from Telus International at $9.50. The Appen share price closed at $6.40 on Wednesday.

Eroad (ASX:ERD)
After delivering revenue of $114.8m in FY22, Eroad anticipates FY23 revenue to come in between $150 – $170m, and EBIT to between -$5m and breakeven. The vehicles fleet tech company also expects revenue to increase to at least $250m by FY25.

Xtek (ASX:XTE)
Defence specialist Xtek received a $9.5m order for its body armour and ballistic helmets. The order was received from an undisclosed regional customer, and will be shipped over the coming weeks.

Noble Helium (ASX:NHE)
Noble Helium has signed an exclusive licence for Global Helium Atlas for up to five years. The agreement, as outlined in the IPO prospectus, provides Noble with exclusive access to the world’s first and only Global Atlas of Helium Occurrences and Exploration Play Fairway Analysis.

Metals Australia (ASX:MLS)
Multiple lithium intersections were discovered from reverse circulation drilling of the lithium-bearing pegmatites at the Manindi Project in WA. Intersections include: 11m @ 1.23% Li2O, 0.31% Rb from 16m (down hole) in MNRC045, and 11m @ 1.11% Li2O, 0.42% Rb from 11m (down hole) in MNRC044.