• The ASX is set to drift higher at the open
  • Goldman Sachs’ profit tumbled by 68pc
  • The ECB is reportedly mulling over softening its rates stance


Aussie shares are set to drift higher at the open on Wednesday. At 8am AEDT, the ASX 200 Jan futures contract was pointing up by 0.30%.

Overnight, Wall Street had a mixed session over concerns of weak corporate earnings and the path for future rate hikes.

The S&P 500 ended 0.2% lower, the Dow fell by 1.14%, and Nasdaq was up slightly by 0.14%.

Goldman Sachs was the latest bank to disappoint with its earnings, dragging other bank stocks lower.

Goldman’s profits tumbled by 68% to $US1.33 billion in Q4, pushing its share price 6% lower.

Morgan Stanley narrowly beat analysts’ expectations on revenues as its wealth management revenue soared. The bank reported revenue of $US6.62 billion in Q4, up 5.9% on the pcp.

CEO James Gorman expressed his confidence that dealmaking will improve once the Fed stops hiking interest rates.

Meanwhile, the Empire State manufacturing index plunged in January as orders collapsed, pointing to weakness in national factory activity in the US.

This comes as China reported the steepest slowdown in its GDP (at 2.9%) since the 1970s.

Chinese vice-premier Liu He however told attendees at the World Economic Forum in Davos that China will bounce back from Covid and return to normal economic growth this year.

“China has passed the infection peak. Members of society have returned to normal,” Liu said about the Covid outbreak in China.

In Europe, the ECB (European Central Bank) is reportedly debating on slowing its rate hike pace after  delivering one last half-point rate increase in February.

“The end of ECB tightening appears to be around the corner as the ECB looks poised to deliver a total of 75 basis points, bringing the deposit rate to 3.25%,” said OANDA analyst, Edward Moya.

German chancellor Olaf Scholz told Bloomberg TV that he’s sure  Germany will avoid a recession this year.

“I’m absolutely convinced that this will not happen — Germany going into a recession,”  Scholz said.

Bitcoin rose another 0.30% in the last 24 hours to trade at US$21,324.

BTC has now recovered all of its losses since FTX collapsed, jumping by more than 22% over the past week.

Cryptos in general are rallying as central banks all around the world show signs they are close to the end of their respective tightening cycles.

“Investors are slowly getting back into crypto as the global crypto market eyes the $1 trillion level again,” said Moya.

Looking ahead to today’s session on the ASX, the weekly payroll jobs and wages will be released in Australia.


5 ASX small caps to watch today

IperionX (ASX:IPX)
IperionX has won the US Air Force Research Laboratory (AFRL) Grand Challenge, hosted by the National Security Innovation Network. The AFRL Grand Challenge involved selecting the most commercially promising technology for producing titanium metal powders from scrap titanium, and rejuvenating out-of-spec titanium powders for use in additive manufacturing. IperionX says winning this prestigious challenge validates the technical superiority of IperionX’s patented technologies to produce circular, low-carbon and lower-cost titanium metal powders.

SRJ Technologies (ASX:SRJ)
SRJ was awarded another major contract in West Africa for a long-term lease of its proprietary flange integrity equipment, BoltEx flange clamps. An initial $144k for the first four weeks has already billed. The client has also requested for a purchase order to be prepared for the sale of the BoltEx equipment following the leasing period, worth approximately $350k.

Termite mound sampling has returned two new significant gold anomalies at the Bouaflé Project. Gold values in the core of the Eastern anomaly include several high-grade samples at over 1g/t Au. Auger drilling program is now under way over the Eastern gold anomaly.

Incannex (ASX:IHL)
The cannabis company said the PsiGAD1 clinical trial, designed to assess Incannex’s psilocybin-assisted psychotherapy for the treatment of generalised anxiety disorder, has achieved its interim milestone of 29 patients completing primary endpoint assessments. Independent analysis of the interim study data has now commenced.

Red Mountain Mining (ASX:RMX)
102 additional contiguous Lode Claims have been staked the Mustang Lithium Project in Nevada. Application for these claims have been successfully lodged to the Nevada Bureau of Land Management, and the company says granting is expected to occur shortly. The Mustang Lithium Project now comprises of 140 Lode Claims covering 1,070ha of exploration tenure.