• ASX set to gain yet again on Wednesday despite Wall Street struggling
  • Reddit gained 12pc, Walt Disney sank -9.5pc
  • RBA Governor Michell Bullock gave this warning to the market

 

Aussie shares are poised to rise yet again on Wednesday despite stocks struggling on Wall Street. At 8am AEST, the ASX200 futures contract was pointing up by +0.2%.

Overnight, stocks’ rally lost steam toward the end of the session. The S&P 500 closed just +0.13% higher, the blue chips Dow Jones index was up by +0.08%, and the tech-heavy Nasdaq slipped by -0.10%.

Exercise equipment maker Peloton Interactive was one of the best performers last night, up +15% after a report by CNBC said some private equity companies might want to buy it.

Disney sank -9.5% after it posted a loss due to restructuring costs, and a weak outlook on subscriber growth. The good news was that Disney made a surprise profit in its direct-to-consumer entertainment division.

Apple rose +0.4% after unveiling a new iPad Pro with the world’s most advanced display, M4 chip, and a new Apple Pencil Pro.

Newly listed Reddit gained +12% after hours as the social media company said revenue went up by 48% to $243 million for the last quarter, topping analysts’ predictions of around $211.9 million.

The US has canceled licences that let Huawei buy computer chips from Qualcomm and Intel, tightening the rules on what the Chinese company can import from the US. Both Qualcomm and Intel shares fell by -1%.

Meanwhile, Fed Bank of Minneapolis President, Neel Kashkari, said last night that it was probably going to be a while before the central bank changes interest rates.

“The most likely scenario is we sit here for an extended period of time,” he said at the Milken Institute Global Conference.

His comments somewhat differ to the views of the analysts at Morgan Stanley, who have just adjusted their prediction for when the Fed will make its first rate cut. Instead of thinking it’ll happen in July, they now reckon it’ll be in September.

 

Warning from Bullock

Back home, RBA Governor Michelle Bullock told a press conference yesterday that officials had actually considered raising rates at the board’s May meeting, but decided to hold off for now.

Her comments came as RBA officials concluded their two-day meeting, which culminated in the central bank’s decision to hold interest rates right where they are at 4.35%.

“On balance, the board felt that at the moment rates staying where they are was appropriate,” Bullock said.

“Getting inflation back to target will take time and I think the path will likely continue to be bumpy, we should all be prepared for that,” she added.

Predictions released by the RBA suggest the central bank expects inflation to go up, not down, mainly because gas prices are bouncing back and the jobs market is tight.

“If we really think that inflation is going to be persistent and significantly above our forecast, we will tighten again,” Bullock said.

 

In other markets …

Gold price fell by -0.45% to US$2,315.61 an ounce.

Oil prices fell by around -0.2%, with Brent crude now trading at US$83.15 a barrel.

Iron ore fell 0.8% to $US118.70 a tonne.

The benchmark 10-year US Treasury yield was down 3 basis points (bond prices higher) to 4.46%.

The Aussie dollar retreated by -0.43% to US65.87 cents.

Bitcoin meanwhile was down around -1% in the last 24 hours to US$63,060.

 

5 ASX small caps to watch today

Viridis Mining and Minerals (ASX:VMM)
Numerous discoveries have been made across eight new concessions previously unexplored at Colossus through scout auger drilling, establishing numerous new prospects for follow-up deeper drilling. Maiden auger drilling at the recently acquired Cupim South Extension has also returned good grades.

Black Cat Syndicate (ASX:BC8)
Black Cat released its Paulsens Gold Operation May 2024 Restart Study report. The May Study (@ $3,500/oz) returns are substantially greater than those in the November 2023 Study (@ $2,900/oz). Results include: Operating Cashflow after all capital and before tax increased by 81% to ~$201m; and a reduction in plant refurbishment risk, timing and cost ($18.3m, down from $19.5m).

Polynovo (ASX:PNV)
The company announced record monthly revenue of $10.1m (unaudited) for April, up circa 68.6% on the pcp. This was the first $10m+ revenue month for the firm. PolyNovo is a medical device company focused o wound care that develops and manufactures dermal regeneration solutions.

Iceni Gold (ASX:ICL)
Iceni provided an exploration update on the recent work conducted on the 14 Mile Well Gold Project. Additional fieldwork at the Christmas Gift prospect in the Everleigh Well area has exposed multiple gold bearing quartz veinlets within a narrow, sheared basalt-interflow sediment contact. The structure has now been exposed over an approximately 20m strike length that is open and has advanced the geological model to provide a priority drill target.

Elsight (ASX:ELS)
Elsight says that during a strategic collaboration exercise, Elsight’s Halo connectivity platform was rapidly integrated with Lockheed Martin Indago 4 UAS to complete BVLOS (beyond visual line-of-sight) flights with enhanced capabilities and expanded operational reach. Following this successful integration, Lockheed Martin is now able to offer this configuration, Indago 4 with Halo, as a solution to their customers, effective immediately.

 

At Stockhead we tell it like it is. While Viridis Mining and Minerals is a Stockhead advertiser, it did not sponsor this article.

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