Market Highlights: ASX on tightrope as traders await blockbuster RBA decision

SPI Futures ahead 2pts, after Wall Street rose overnight
The RBA to announce its latest interest rate decision today
AI chipmaker Nvidia unveils powerful new Blackwell platform

You can expect an ASX on ice as trade kicks off in Sydney this morning.

The S&P/ASX200 index futures contract was down just two points to 7682.0 on Tuesday morning, despite a strong session on Wall Street overnight.

The local benchmark recovered from early losses to close Monday, March 18, 2024 ever so slightly into the green, up 5.5 points or 0.07% to 7,675.80.

Investors will be largely sidelined – closely eyeing the Reserve Bank of Australia’s interest rate policy decision statement scheduled for release at 2.30pm (AEDT), with the central bank largely expected to keep rates on hold.

The RBA’s last rate hike occurred in November, raising rates by 25 basis points to 4.35%, marking a 12-year high. This increase marked the central bank’s 13th rate hike since May 2022, as it endeavors to steer inflation back towards its target range of 2-3%.

January’s Australian CPI stood at 3.4% yoy, falling short of economists’ consensus forecast of 3.6%. Despite this, it remains the lowest annual inflation rate since November 2021, fueling speculation of a potential interest rate cut later in the year. Consensus suggests that the RBA will maintain current rates at tomorrow’s meeting.

The Bank of Japan’s monetary policy decision is also expected on Tuesday. Japan’s central bank is widely anticipated to abandon its negative interest rate policy due to an uptick in wage growth and other economic data.

The Bank of England and US Federal Reserve will release their interest rates decisions later this week.

Not the ASX

On Wall Street, the mega cap stocks lifted the tech-focused NASDAQ index 0.9% higher, the S&P 500 rose 0.7 % and the Dow Jones Industrial closed 0.2% higher.

Google’s parent Alphabet rose ~5% after reports that Apple was in talks to build Google’s Gemini AI engine into its iPhone.

Tesla shares surged by 6.3%, topping the list of percentage gains in the S&P 500, following an announcement by the electric car manufacturer of an impending price hike for its Model Y EVs in certain European regions.

AI chipmaker Nvidia shares rose by 0.7% as the high profile unveiled a new powerful faster platform called Blackwell at its five-day annual developers conference in San Jose which has been dubbed the “AI Woodstock”.

Nvidia says the Blackwell platform “will enable organisations everywhere to build and run real-time generative AI on trillion-parameter large language models at up to 25x less cost and energy consumption than its predecessor”.

“The Blackwell GPU architecture features six transformative technologies for accelerated computing, which will help unlock breakthroughs in data processing, engineering simulation, electronic design automation, computer-aided drug design, quantum computing and generative AI — all emerging industry opportunities for Nvidia,” the company says in a release.

Nvidia says among the many organisations expected to adopt Blackwell are Amazon Web Services, Dell Technologies, Google, Meta, Microsoft, OpenAI, Oracle, Tesla and xAI.

Oil higher, US dollar firmer

Ongoing geopolitical tensions has seen global oil prices lift with benchmark Brent crude up 2.16% nearing $US87/barrel and US WTI lifting 1.81% to near $US83/barrel.

Iron ore is continuing its downward trend, currently 2.84% lower to US $102.50/tonne.

Gold is 0.23% higher to $US2160/ounce, while copper is up 0.07% to US$4.12lb.

US 10-year bond yields have settled near 4.33% ahead of the Fed’s interest rate decision later this week.

The US dollar has lifted with the Aussie dollar down 0.02% trading around US65.60c. Bitcoin is down 1.07% to US$67,520 retreating from its highs of above US$73,000 seen last week.

Shares to watch on Tuesday:

Poseidon Nickel (ASX:POS) After overseeing the Lake Johnston sale and delivering annualised savings of over $6mn, POS says CEO Craig Jones will leave the company to “explore other opportunities” with CFO Brendan Shalders to transition to CEO from April 1, 2024.

Aurum Resources (ASX:AUE) will acquire a 100% interest in the advanced Boundiali South exploration tenement (PR-414), which the explorer says neighbours its existing “highly prospective Boundiali Gold Project comprising of the BD tenement and BM tenement” in Côte d’Ivoire, West Africa.

Boss Energy (ASX:BOE) reckons it’s hit some “exceptionally high-grade” results from drilling at its 30%-owned Alta Mesa Uranium Project in South Texas. The results, which were released by Alta Mesa’s 70% owner and operator NASDAQ-listed Energy Corp (enCore), contain “the highest-grade intersections recorded at the project” since drilling activities restarted.