ASX likely to rise today after the US CPI data met expectations. Pic via Getty Images
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The ASX is set to rise when the market opens on Thursday after the much anticipated US CPI figure came in line with expectations. At 8am AEST, the SPI ASX200 futures contract was pointing up by 0.4%.
Overnight, the S&P 500 continued to rise for a fifth consecutive day, marking its longest winning streak in over a month as it rose by a further 0.38%. The blue chips Dow Jones lifted by 0.61%, while the the tech heavy Nasdaq closed flat.
The inflation rate in the US dropped to 2.9% in July compared to the same month last year, in line with what Wall Street had predicted.
The lower CPI rate, which is down from June’s 3%, suggests the Fed Reserve might have enough ammunition to cut rates in its mid-September meeting.
While 2.9% is still higher than the central bank’s 2% target, it was the first time inflation has been below 3% since April 2021.
“The inflation data is good enough to allow the Fed to start cutting rates in September, but does not give them a reason to cut aggressively,” said Brian Rose at UBS Global Wealth.
According to the CME FedWatch tool, about 36% of traders are now betting on a 50 basis point cut in September, while the rest are anticipating a smaller cut of 25 basis points.
To stock news, Alphabet dropped 2.35% after Bloomberg reported that the US Justice Department is contemplating breaking up the company. This follows a court ruling that found Google holds a monopoly in the online search market.
Apple Inc was flat despite saying that it was pursuing new revenue streams by developing an expensive tabletop home device that features an iPad-like screen and a robotic arm.
Victoria’s Secret surged up by 16% after the company announced Hillary Super, the CEO of Rihanna’s Savage X Fenty brand, as its new CEO.
In the biggest deal ever in the packaged food sector, Mars announced that it will acquire Kellanova, the company behind Pringles, for nearly US$36 billion.
Mars, which owns brands such as Skittles, M&Ms, and Twix, will offer US$83.50 per share for Kellanova, which is more than 30% higher than the share price earlier this month when Reuters first revealed the potential deal.
And, looking ahead to today’s ASX session, earnings season continues with Treasury Wines, Cochlear, Telstra, Origin Energy, and Magellan Financial among the companies set to release their results.
Meanwhile, Michael Burry, known for his bet against the US housing market in 2008 and subsequent depiction in the book and movie The Big Short, increased his stake in Alibaba Group, while cutting his overall equity portfolio by half.
His firm, Scion Asset Management, now owns $11.2 million in Alibaba, up from $9 million in the previous quarter, according to Bloomberg.
Additionally, Scion’s second-largest investment was in Shift4 Payments, with a new $7.3 million position after buying 100,000 shares.
Scion made several new investments across various sectors, including financial services, healthcare, and commercial real estate.
The fund invested over $5.5 million each in Shift4 Payments, Molina Healthcare, and Hudson Pacific Properties, and also added stakes in Olaplex Holdings and BioAtla.
Scion also exited several investments, including HCA Healthcare, Citigroup, Block Inc, Cigna Group, and Advance Auto Parts.
The fund also reduced its holdings in JD.com and RealReal.
Overall, Scion now has stakes in 10 stocks valued at more than $52 million, down nearly 50% from the previous quarter.
Gold price fell by 0.65% to US$2,447.95 an ounce.
Oil prices tumbled another 1%, with Brent crude now trading at US$80.09 a barrel.
The benchmark 10-year US Treasury yield traded flat at 3.84%.
The Aussie dollar retreated by 0.5% to US65.99 cents.
The iron ore price slipped by 2.5% to US$96.20 a tonne.
Bitcoin meanwhile fell by 2.5% in the past 24 hours to US$58,668, and Ethereum also dropped 2.5% to US$2,650.
Lotus Resources (ASX:LOT)
Lotus has completed drilling 27 more holes at its Letlhakane Uranium Project in Botswana, bringing the total to 109 out of 180 planned. The company’s updated estimate shows the project contains 155 million tonnes of ore with 118.2 million pounds of uranium. Recent drilling has found strong uranium concentrations, confirming the presence and quality of the resource.
Lotus has also started new drilling at Serule West for processing tests and plan to explore additional areas soon. The drilling is on track to complete by September, with an updated resource estimate to follow. The company is advancing Letlhakane while also focusing on their Kayelekera project in Malawi.
Future Battery Minerals (ASX:FBM)
FBM has identified 13 new pegmatite targets at its Miriam Lithium Project, thanks to a recent geophysical review. These targets are spread across the project’s 6-kilometre area and include five structures that match a significant soil anomaly and outcropping spodumene-bearing pegmatite. These new targets are similar to the Big Red pegmatite found at a nearby project.
The company plans to start surface sampling soon to refine these targets and is awaiting results in October, which will guide its initial drilling program. It has also applied for a government grant to help fund this drilling, with results expected around the same time.
Strike Energy (ASX:STX)
Strike has been granted a Production Licence for its West Erregulla gas field in the north Perth Basin. This field has significant reserves and has been thoroughly prepared.
Strike, which holds a 50% stake, and its partner Warrego Energy are planning a major gas development with an 87 terajoule per day capacity, supported by environmental approvals and Australian Gas Infrastructure Group for processing and pipelines. Strike’s CEO, Stuart Nicholls, said this licence makes the project more viable and confirms West Erregulla as a key future gas source for WA, with production expected into the 2040s.
Firebrick Pharma (ASX:FRE)
Firebrick has signed a new agreement with its Philippine partner, S.V. More Pharma, allowing local production of Nasodine in the country. This change means Nasodine can be manufactured and sold locally as a nasal disinfectant spray without needing additional clinical studies.
S.V. More will oversee the local production with Hizon Laboratories, which will handle the manufacturing and necessary paperwork for approval from the Philippines Food and Drug Administration. The company expects the product to be ready for launch in the Philippines within about 12 months.
Gladiator Resources (ASX:GLA)
Gladiator has reported high-grade uranium at its Mkuju Project in Tanzania, with the latest drill hole at SWC showing over 3000 parts per million.
The project covers a 12-kilometre corridor with widespread uranium, and the company is targeting a significant roll-front system. Drilling at the southern end of Mtonya also suggests a large mineralised system. The drill rig has now moved to Likuyu North to explore a nearby area. Gladiator plans to expand exploration to find the main roll-front deposit.
At Stockhead we tell it like it is. While Future Battery Minerals is a Stockhead advertiser, it did not sponsor this article.
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