• The ASX is set to open lower on Friday
  • Wall Street reverses the previous day’s gains, with a selloff in tech stocks
  • Meta to reduce staff for the very first time

Local shares look set to open lower today. At 8am AEST, the ASX 200 October futures contract is pointing down by 0.35% and is heading towards a 7% loss for the month of September.

Overnight, it was another miserable session for European and US equities as the prospect of recession becomes ever more real.

US jobless data showed the economy is still performing remarkably well, but even this could translate to more Fed rate hikes.

On Wall Street, all major indexes (S&P 500, Dow, and Nasdaq) fell by around 2% each, erasing the previous day’s gains. The S&P 500 is nearing a two-year low.

In Europe, stocks didn’t fare much better with the FTSE 100 also tumbling by 2% as the Bank of England boost fades away.

There was another round of hawkish Fed speak overnight, with Fed of Cleveland President Loretta Mester saying that she does not see any distress in US financial markets that would slow down the Fed’s determination to suffocate inflation.

Chicago Fed President Charles Evans however said he remains “cautiously optimistic” that the US economy can avoid a recession, provided there are no further external shocks.

In company news, Meta CEO Mark Zuckerberg has outlined a plan to reorganise the company, which may involve reducing headcount for the very first time.

“I had hoped the economy would have more clearly stabilised by now,” Zuckerberg said. “But from what we’re seeing it doesn’t yet seem like it has, so we want to plan somewhat conservatively.”

Shares in tech giants Apple, Amazon, Meta and Tesla all tumbled by as high as 7%.

Apple was delivered an extraordinarily rare downgrade by Bank of America, citing the risk of weaker product demand.

In Japan, tech stock Softbank is also planning to cut at least 30% of its staff, according to a report from Bloomberg.

The turmoil in stock markets is dragging down crude prices as risk appetite quickly vanishes.

The benchmark Brent crude fell another 1% last night to trade at US$88.22 a barrel, which is below pre-invasion levels.

“A deteriorating crude demand outlook won’t allow oil to rally until energy traders are confident that OPEC+ will slash output at the October 5th meeting,” said OANDA analyst, Edward Moya.

Gold is trading at US$1,662 an ounce, while Bitcoin had a volatile ride in the last 24 hours, trading now at US$19,500.

“It appears Wall Street believes crypto is close to the bottom, and will become an attractive diversification strategy once the peak in Treasury yields is in place,” Moya said.

Looking ahead to today’s ASX session, Australia’s private sector credit data will be released by the ABS.

5 ASX small caps to watch today

Raiden Resources (ASX:RDN)
Historic mining has defined a potential for near surface high grade Ni-Cu Sulphide mineralisation. Drilling has tested a +150m wide, 25m average thickness mineralised zone at the B1 deposit, with grades ranging from 0.64% Ni_Eq to 1.67% Ni_Eq.

Alchemy Resources (ASX:ALY)
Alchemy has been drawn first in a ballot for exploration licence E28/3207 at its 100% owned Karonie Lithium and Gold Project in WA. The new tenement covers approximately 24.8km2 of highly prospective tenure along strike of Global Lithium’s Manna Lithium deposit, and adjacent to Breaker Resources’ Lake Roe Gold Project.

Winsome Resources (ASX:WR1)
Rock chip Assay results from the recent Jamar Discovery at Adina have confirmed that lithium mineralisation is much larger than previously thought. Results include: 3.38% Li2O for Sample C00279921, and 4.89% for Sample C00279929.

Marmota (ASX:MEU)
RC drilling at Marmota’s gold discovery at Aurora Tank is due to commence next week, including outstanding grades of 217 g/t gold over 1m, and multiple high- grade extensions to the NE, SW and at depth. Marmota says this has given rise to immediate high-priority drilling targets that require follow up.

Qualitas (ASX:QAL)
Qualitas has secured a new $440 million commitment from a global institutional investor for the Qualitas Construction Debt Fund II. The new funds will be deployed immediately into the residential construction senior debt opportunity in a vibrant and growing Sydney residential precinct.