Market Highlights: Dovish comments from Fed, gold nears all-time high, and 5 ASX small caps to watch

ASX to gain on Wednesday after dovish comments from US Fed
Gold price continues to climb, nears all time high
Deutsche Bank is positive about equities’ prospects in 2024

Aussie shares are poised to edge higher again on Wednesday after modest gains on Wall Street overnight. At 8am AEDT, the ASX 200 index futures was pointing up by +0.2%.

In New York, the S&P 500 rose by +0.1%, the blue chips Dow Jones index was up by +0.24%, and the tech-heavy Nasdaq climbed by +0.29%.

Stocks gained after comments from Fed Reserve governor Christopher Waller suggest the Fed is done with hiking rates.

“I am increasingly confident that policy is currently well positioned to slow the economy and get inflation back to 2 per cent.”

Waller added that he could see a point where the Fed might start lowering rates. “There is no reason to say we will keep it really high.”

Some good news for retailers as US consumers spent US$12.4 billion online on Cyber Monday, which was around 10% higher than last year.

Among the stock movers last night were Boeing, which rose 1.4% after RBC Capital Markets upgraded the company to “outperform” from “sector perform”.

Chinese retailer Pinduodu surged 18% on Nasdaq after the firm easily beat Q3 earnings forecasts.

Bond markets also rallied (yields down) as investors become more confident that the Fed Reserve is in a position to drop rates next year.

Crude prices meanwhile lifted after three consecutive days of declines as the US dollar weakened further, and ahead of the OPEC+ meeting on November 30.

S&P 500 to hit all time high next year?

Deutsche Bank (DB) says it remains positive about the prospects for the S&P 500 in 2024, predicting a level of 5,100 by the end of next year, a new all time high.

That would imply a 12% increase versus the 4,554 level right now.

The bank’s bullish outlook is based on its view of a ‘soft landing’ economic scenario in the US, with inflation cooling and quarterly GDP growth remaining strong.

DB isn’t the only big name on Wall Street to predict the S&P 500 could climb to record highs.

RBC Capital Markets, Bank of America, Société Générale, BMO Capital and Goldman Sach have also predicted an upbeat 2024 for US equities.

In other markets …

Gold price keeps climbing, up another 1.3% to US$2,040.07 an ounce.

Bullion has been rising on the back of a weaker US dollar, and the current rally has boosted hopes that bullion could top its all-time high of US$2,074.88 reached in August 2020.

Oil prices lifted +2% after three days of declines, with Brent now trading at US$81.43 a barrel.

The benchmark US 10-year treasury yield fell 6 basis points to 4.33%.

Iron ore futures traded sideways to US$130.40 a tonne.

The Aussie dollar rose further by 0.64% to US66.46c ahead of the CPI reading today.

Meanwhile, Bitcoin was up 3% in the last 24 hours to US$38,104.

5 ASX small caps to watch today

Acusensus (ASX:ACE)
The road safety solutions company announced an extension to its existing Mobile Phone Detection Camera Agreement with the Transport for NSW (TfNSW) for an additional year. Revenue (in addition to that previously contracted) from this contract extension is expected to total around $4.5m (incl. GST).

EROAD (ASX:ERD)
The transportation tech company has delivered its half-year FY24 results. Revenue increased to $88.9m for H1 FY24 from reported revenue of $85.4m on the pcp. Growth in revenue was delivered across all markets. EBIT however was reduced to a profit of $0.4m in H1 FY24 from a profit of $1.0m in H1 FY23. EROAD expects to be free cash flow positive in the latter part of calendar 2024.

Cobre (ASX:CBE)
Cobre announced results from the recently completed aircore (AC), reverse circulation (RC) and soil sampling programmes on the Kitlanya West Project in the Kalahari Copper Belt (KCB), Botswana. Infill RC drilling at the Tlou fold target has returned consistent anomalous bedrock copper results increasing the target size to 4km x 1.2km. RC traverses meanwhile have confirmed the presence of anomalous copper.

Horizon Minerals (ASX:HRZ)
New lithium exploration targets have been generated at the company’s 100% tenure in the Goldfields region, both west and southeast of Kalgoorlie. Soil sampling and auger programs have highlighted an unexplored >14km long trend of semi-contiguous lithium and pathfinder anomalies up to 300m wide. Several nearby drillholes, assayed for gold only in 2021, have returned positive fluorescence within extensive white clay zones indicating the potential presence of lithium mineralisation.

Oncosil Medical (ASX:OSL)
The medical device company says the first patient has been treated in the PANCOSIL Investigator Initiated Clinical Trial on 28 November. This study received ethics approval back in June. The trial is examining the safety and feasibility of the OncoSil device for patients with locally advanced pancreatic cancer. In all, 20 patients will be treated with the OncoSil device by percutaneous application over the course of the trial.