Market highlights and 5 ASX small caps to watch on Wednesday

Tech stocks lead global sell-off

Tech and growth stocks mostly fell overnight, after US Treasury Secretary Janet Yellen said that interest rates may have to rise to cool down the economy.

The comments have sparked a global equities sell-off, with most indices in the US and Europe falling overnight.

In the US, tech heavy NASDAQ fell by 1.88%. S&P 500 index was down by 0.67%, but Dow Jones picked up slightly by 0.06%.

Most major indices in Europe fell between 0.7% to 2.5%.

Speaking with The Atlantic, Secretary Yellen said: “It may be that interest rates will have to rise somewhat to make sure that our economy doesn’t overheat.”

Tech and growth stocks are especially sensitive to increases in interest rates.

In other markets, oil rose again by 1.3%, and has hit a seven-week high. The 10-year US Treasury yield unexpectedly fell by 2 basis points to 1.58% after the Yellen comment.

Bitcoin has dropped to US$54,00 level as at 8am AEDT, after trading at US$57,000 level on Tuesday. It was reported that Betashares and VanEck have applied to the ASX for a potential Bitcoin ETFs in Australia.

Closer to home

The ASX 200 finished higher by 0.56 per cent on Tuesday, after the RBA said it will maintain interest rates at 0.10%.

The RBA has upgraded Australia’s economic growth and unemployment rates. According to the central bank, GDP is set to grow to 4.75% by end of 2021, up from the earlier forecast of 3.5%. Unemployment is set to drop to 5%, an improvement from the previous forecast of 6%.

In big caps news this morning, ANZ Bank (ASX:ANZ) cash profits for the half missed estimates. ANZ reported cash profits of $2.99 billion against estimate of $3.1 billion. However, its profit after tax was $2.94 billion, a 45 per cent increase from the previous half.

5 ASX small caps to watch today

ikeGPS (ASX:IKE)
The data company focusing on the utilities sector said that it has signed an extension to an important agreement with a Fortune 100 US electric utility, to help assess and design its power distribution infrastructure. This will add approximately $1.2m transaction revenue in IKE’s FY22. The company also reported a record quarter, which saw contracts topping approximately $5.4m.

Neuroscientific Biopharma (ASX:NSB)
NSB has reported positive outcomes from recently completed ocular pharmacokinetic (PK) and tissue distribution studies. The studies concluded that EmtinB significantly exceeded the target end point for minimum duration, with significant tissue penetration up to six days and detection in the vitreous (ocular fluid) across all time points up to 14 days. Based on this, additional studies to develop an eye drop formulation of EmtinB are now planned for 2H 2021.

MoneyMe (ASX:MME)
The credit fintech business has just delivered record originations of $47m for the month, and revised its expectations for gross customer receivables to exceed $300m at FYE 21. These originations are up by 693 per cent on pcp, and revenue is now set on a trajectory to deliver a $58m to $62m for the full year.

Nyrada (ASX:NYR)
The pre-clinical stage drug company revealed that its cholesterol-lowering program has delivered two new potent drug candidates. These results will now enable selection of the optimal candidate to go into safety and pharmacology studies at an internationally recognised CRO, before a Phase I first-in-human study.

Hastings Tech Metals (ASX:HAS)
The minerals exploration company has announced a material increase in Mineral Resource Estimate at its Yangibana Rare Earths Project in Western Australia’s Gascoyne region. Measured and indicated tonnes for deposits drilled during 2020 increased by 54% to 16.3Mt, with a corresponding 32% increase in total rare earth oxides (TREO) to 137kt.