Market Highlights: Aussie ETFs at new all-time high, and 5 ASX small caps to watch on Tuesday

US stocks were mixed overnight as traders await inflation data
Oil prices rose 3pc due to Middle East conflict concerns
The Aussie ETF industry hit a new record with $215.6 billion in assets

The ASX is set to open flattish when the market opens on Tuesday.

Overnight, US stocks struggled for direction as traders awaited inflation data, with recent geopolitical events also dampening risk-taking.

The S&P 500 closed the day flat, the blue chips Dow Jones was down 0.36%, while the the tech heavy Nasdaq rose by 0.21%.

Investors are holding off from making big bets as they wait for inflation data on August 14, as well as a report on the state of the US economy.

Nomura and Morgan Stanley both expect US core inflation to rise slowly. However, if the data turns out differently, it could lead to a significant turn on Wall Street.

“Volatility could return this week,” said Solita Marcelli at UBS Global Wealth. “If inflation is too low, this may heighten concerns that the US may be heading for a recession.”

Meanwhile, oil prices jumped by 3% overnight, the fifth consecutive day of gains, driven by concerns that an expanding conflict in the Middle East could tighten global oil supplies.

This comes as the US Defence Department announced over the weekend that it will deploy a guided missile submarine to the region in anticipation of potential attacks on Israel by Iran and its allies.

To stocks news, B. Riley Financial Inc slumped by 51% after an expanding US investigation.

Earlier, Bloomberg reported that the SEC was investigating the interactions between Bryant Riley, B. Riley’s founder and co-CEO, and Brian Kahn, the former CEO of Franchise Group, for potential insider trading.

Trump Media & Technology fell 5% after former President Donald Trump rejoined X, the platform formerly known as Twitter, just hours before his highly anticipated conversation with Elon Musk, scheduled for 10am AEST on Wednesday.

And Nvidia climbed 4% despite Wall Street remaining focused on discussions about potential delays for its next-generation Blackwell chip.

Nvidia’s upcoming earnings report on August 28 could also be the next big catalyst for the markets. Strategists believe this report could determine the direction of the Big Tech versus rotation trade.

Back home, earnings season rolls on with CSL, Challenger, James Hardie, and Temple & Webster scheduled to release their earnings reports today.

Aussie ETF Industry at new all-time high

Betashares has released its Australian ETF Review July 2024 report.

In July, the Australian ETF industry reached a new all-time high in assets under management, driven by record net flows.

The industry saw a 5% increase for the month, with the total market cap rising by $10.3 billion to a new record of $215.6 billion.

July’s net flows were a record-breaking $3.5 billion, surpassing the previous high of $2.9 billion set in September 2021. This growth came from a combination of new investments and market appreciation.

Despite the market dip in August, early data shows that ETF investors are capitalising on the volatility, with nearly $1 billion in net flows already recorded for the month.

ASX trading value for ETFs was about $14 billion in July, the second highest on record.

And over the past year, the Australian ETF industry has grown by 43.7%, or $65.6 billion.

In July alone, six new funds were launched, including a currency-hedged S&P 500 fund and a new Australian Equities Momentum ETF.

The top-performing ETFs in July focused on US small caps, cryptocurrencies, and gold miners.

In other markets …

Gold price rallied by almost 2% to US$2,472.50 an ounce.

Oil prices lifted by 3%, with Brent crude now trading at US$81.92 a barrel.

The benchmark 10-year US Treasury yield retreated by 5 basis points (bond prices higher) to 3.90%.

The Aussie dollar lifted by 0.2% to US65.88 cents.

The iron ore price rose by 0.5% to US$101.40 a tonne.

Bitcoin meanwhile gained by 0.7% in the last 24 hours to US$59,025, while Ethereum surged by 5% to US$2,696.

5 ASX small caps to watch today

West African Resources (ASX:WAF)
WAF has reported strong results from its initial grade control drilling at the Kiaka South pit in Burkina Faso. The drilling revealed high-grade gold near the surface, including 22 meters at 7.6 g/t gold. Located 700 metres from the main pit, Kiaka South is expected to provide higher-grade ore in the first 18 months of production.

Executive Chairman Richard Hyde said the results have surpassed expectations and the company will optimise the pit design before mining starts in Q1 2025. WAF aims to produce 4 million ounces of gold over the next decade, with peak production of 473,000 ounces annually by 2029. Current resources are 12.8 million ounces, with ore reserves at 6.1 million ounces.

Alchemy Resources (ASX:ALY)
Alchemy has secured access to three exploration licenses in NSW, including areas at Yellow Mountain, Overflow, and West Lynn, following an agreement with the Ngemba, Ngiyampaa, Wangaaypuwan, and Wayilwan (NNWW) people. Planning for exploration at Yellow Mountain is underway, with high-grade historic results and new drilling planned.

Alchemy has also submitted requests for heritage surveys and is well-funded with $3 million in cash. The agreement ensures a collaborative relationship with the Traditional Owners and compliance with heritage protection requirements.

FMR Resources (ASX:FMR)
FMR reported high-grade copper at its Fairfield Copper Project in Canada, with rock chip samples showing up to 38.4% Cu at Tantramar. High-grade silver was also detected. An airborne survey is planned to identify potential anomalies.

Non-Executive Director Bill Oliver said these promising results suggest a significant mineralisation system. Fieldwork continues, and more results are expected soon. The project is in New Brunswick, Canada, within a known copper-gold belt.

Geopacific Resources (ASX:GPR)
GPR has increased the Mineral Resource at its Woodlark Gold Project in Papua New Guinea to 1.67 million ounces of gold. This boost, including 103,000 additional ounces from the Great Northern and Wayai Creek deposits, follows a recent scoping study that forecasts strong financial returns. A new drilling campaign is underway to further explore high-grade areas, adding potential for more growth.

Leeuwin Metals (ASX:LM1)
Leeuwin has reported promising results from its initial rock chip sampling at the West Pilbara Iron Ore Project in WA. The assays show high iron content and low impurities, suggesting the potential for a significant deposit in this well-established mining region. These early results indicate a potential large-scale project, supported by excellent local infrastructure.

Leeuwin plans to expand the exploration area with follow-up fieldwork in the coming weeks. The project, recently added to Leeuwin’s portfolio, is expected to generate further positive news in the latter half of 2024.

At Stockhead we tell it like it is. While Leeuwin Metals is a Stockhead advertiser, it did not sponsor this article.