Market Highlights and 5 ASX Small Caps to watch on Wednesday

ASX to open flat as Wall Street rally continues

The relatively upbeat week in equity markets has continued overnight, with all three US stock market benchmarks rising for the third consecutive day.

The S&P 500 climbed by 0.65%, the Dow Jones by 0.95%, and tech heavy Nasdaq by 0.97%.

Earnings continue to roll in, with Pfizer down 3% after the company missed its full year sales target for the Covid-19 vaccines and pills.

Facebook was also down 2.5% after Peter Thiel stepped down from its Board after 20 years in order to pursue the ‘Trump agenda’.

In commodities, gold is moving higher and last night it rose by another 0.40% to $US1,827.50 an ounce.

Senior market analyst at Oanda, Craig Erlam, says the area around $1,830 has repeatedly been a major barrier, and when it has briefly managed to overcome that, it hasn’t progressed much further. It will be interesting to see if history repeats itself, he says.

Meanwhile, oil prices have finally cooled down with Brent crude down 2% $US90.74 a barrel.

This came as the US and Iran indirectly continue talks over the nuclear deal that could see more than a million barrels quickly come back online.

To cryptos, where Bitcoin experienced a choppy trading session over the last 24 hours. After being pummelled to below US$43k, BTC staged a rally and at 8.00am AEDT, is trading US$44,105.

Erlam reckons Bitcoin’s performance has been really impressive recently, not just because it’s overcome a key resistance level at $40,000 but it’s done so at a time when sentiment remains extremely shaky in the markets.

BTC ran into a little difficulty around $45,500 which was a major level of support in December, but Erlam says it appears to have some decent momentum behind it now.

ASX 200 to open flat on Wednesday

The ASX 200 index looks set to open flat this morning, with futures markets (March contracts) pointing just slightly up by 0.04% at 8:00am AEDT.

Yesterday, Miners and Financials lifted local shares, as the ASX 200 defied Wall Street’s falls the previous night to climb 1.07%.

Macquarie Bank reported a record quarter, while travel stocks took off again in the wake of PM Scott Morrison putting a date to the uncorking of Australia’s international borders – the 21st of February.

In large caps news this morning, Commonwealth Bank (ASX:CBA) reported H1 FY22 net profit of $4.75bn, a 23% jump from H1 FY21. However, the bank’s net interest margin decreased by 17 basis points during the half.

On the economics front, the ABS will release the all important weekly payroll jobs and wages data later today.

5 ASX small caps to watch today

Temple & Webster (ASX:TPW)
The online furniture retailer delivered record revenue of $235.4m for the half, up 46% on the year before and 218% on FY20. That means the business has more than tripled in 2 years. The company’s closing cash balance also grew to $105m with no debt.

SenSen Networks (ASX:SNS)
SenSen has been awarded a contract by Duncan Solutions to help service the Toowoomba Regional Council in QLD. SenSen will earn ~$230k over the 36-month period of the initial contract commencing in March.

Caspin Resources (ASX:CPN)
Results received from first hole at XC-22 confirm a significant zone of Ni-Cu-PGE mineralisation. The upper Ni-Cu sulphide zone produced results which include: 2m @ 1.42% Ni, 0.47% Cu, 0.33g/t 3E (Pd+Pt+Au) from 46m.

Galileo Mining (ASX:GAL)
Electromagnetic (EM) surveying at Norseman has defined strong conductors beneath massive sulphides in recent aircore drilling. Galileo says sulphides occured above the confluence of two modelled conductors, which are up to 800 metres long and start at a depth of 70 metres below surface.

Scorpion Minerals (ASX:SCN)
Scorpion and Fenix Resources have accelerated and expanded previous iron ore earn-in agreement over the Pharos Project in WA. Fenix is now deemed to have earned a 100% interest in the Iron Ore Rights in Pharos Project.