Market Highlights: ASX to climb as Wall Street rallies, RBA speak in focus

The ASX will rise on Thursday after a strong rally on Wall Street overnight
Oil prices tumble another 5%
RBA governor will speak

Local shares are set to open higher today. At 8am AEST, the ASX 200 September futures contract is pointing up by 0.50%.

Overnight, all three major indexes on Wall Street surged strongly – the S&P 500 by 1.83%, the Dow Jones by 1.40% and tech-heavy Nasdaq by over 2%.

There were gains across major Techs – Tesla rose by 3.5%, and Amazon by 3%.

Apple shares also rose 1% after the company launched its iPhone 14 and Watch Series 8. The base iPhone 14 starts at $1,399, and the iPhone 14 Plus will start at $1,579 RRP.

After rising sharply over the last few days, yields on US treasuries finally fell. The 10-year fell 6bp to 3.28%, and the 2-year also fell 6bp to 3.44%.

Global oil prices tumbled by another 5%, with benchmark Brent crude settling well below US$90, and now trading at US$87.63 a barrel.

Oil traders were reacting to downbeat Chinese trade figures. According to the release yesterday, China’s exports rose 7.1% in August, missing expectations of a 12.8% increase.

“It appears the risk of losing Russian energy supplies is no longer keeping oil prices supported, and that has energy traders solely fixated on the demand side drivers,” said OANDA analyst, Edward Moya.

Spot gold rose slightly to US$1,718 an ounce as the rally in Treasury yields eased.

“Gold is still vulnerable to another massive selloff, but for now it appears to be stabilising,” said Moya.

To cryptos, where Bitcoin was up 2% in the last 24 hours, and is now trading at US$19,379.

Another crypto crash could be on the way as mining pool Poolin said it has paused withdrawals from its wallet.

Earlier, management said it was facing liquidity issues and revealed plans to pause all withdrawals, flash trades, and internal transfers.

A mining pool is the pooling of resources by miners, who share their processing power over a network to split the reward equally (source: Wiki).

Looking ahead today, RBA governor Philip Lowe will make a speech titled: “Economic Outlook and Monetary Policy”.

Australia’s international trade data for July will also be released.

5 ASX small caps to watch today

European Lithium (ASX:EUR)
High-grade lithium assays of up to 3.24% Li2O were returned from rock chip samples taken at three Austrian Lithium projects. The projects are located within the Eastern Alps, close to European Lithium’s Wolfsberg Project which has a JORC-compliant Total Mineral Resource Estimate of 12.9 Mt @ 1.00 % Li2O.

Gascoyne Resources (ASX:GCY)
Gascoyne’s group gold resources have increased by 15.6% to 1.37Moz, with resource grade up by 29% bringing it in total to 36.74Mt @ 1.16g/t gold for 1,370,800 ounces.

5E Advanced Materials (ASX:5EA)
5E will collaborate with Boston College with the aim of developing a novel boron-based solar energy capture, conversion, and storage system. The research aligns with 5E’s strategy of IP creation in future facing boron-enabled applications.

Burley Minerals (ASX:BUR)
Burley has been granted highly prospective Pilbara Exploration Licence with confirmed Channel Iron Deposit (CID) Mineralisation in the Hamersley Iron Ore Province of WA. Historic sampling has confirmed the presence of up to 61.5% Fe in the surface samples.

Burgundy Diamond Mines (ASX:BDM)
Burgundy annouced the recovery of its first diamond at the Ellendale Diamond Project after recently reaching the final stages of commissioning of the bulk sample plant at Blina. The company has now started to ramp up throughput rates at its plant on site in the Kimberley.