• ASX to lift on the back of another rally on Wall Street
  • Tesla jumped +15pc following Elon Musk’s trip to China
  • US Fed meeting on Wednesday casts a shadow over the market

 

Aussie shares are poised to extend its gains this week, tracking Wall Street’s rebound. At 8am AEST, the ASX200 futures contract was pointing up by +0.2%.

Overnight, the S&P 500 rose by +0.32%, the blue chips Dow Jones index was up by +0.38%, and the tech-heavy Nasdaq lifted by +0.35%.

Tesla soared 15% after China cleared a regulatory hurdle for its driver-assistance software, the Full Self-Driving (FSD), and allowed the company to partner with local search giant, Baidu. This follows Elon Musk’s unannounced trip to the country the previous day.

Apple rallied +2.5% after Wall Street research firm Bernstein said that Apple’s woes may be coming to an end, urging investors to “buy the fear”.

Bankrupt firm WeWork, trading on OTC Markets, rose +15% after its major financial backers including SoftBank struck a new restructuring deal to get the company out of bankruptcy.

Domino’s Pizza is on a roll, lifting by +5.6% after the pizza giant’s Q1 beat analysts’ expectations despite tough terrain for restaurant brands.

Meanwhile, the Fed Reserve’s rates decision meeting will be held on Wednesday (US time), with analysts expecting the central bank to leave them unchanged.

“Powell should indicate the next move is still likely to be a rate cut, but the Fed will be in wait-and-see mode until it achieves confidence it desires on inflation,” said Bank of America’s US economist, Michael Gapen.

 

What’s in store this week

This will be a big week for the US economy, with the Fed Reserve meeting Tuesday and Wednesday, and the April jobs report dropping on Friday.

Given persistent inflation, the consensus is for the Fed to maintain interest rates at their current levels, not only for this meeting but also for the foreseeable future – a stark departure from earlier expectations at the year’s outset.

On the employment front, economists foresee another robust month of growth.

On the earnings front, following the impressive results of Alphabet and Microsoft last week, two more Magnificent Seven companies will unveil their reports this week – Amazon and Apple.

While Amazon is anticipated to showcase substantial revenue growth, analysts are more reserved about Apple’s prospects, particularly amid declining iPhone sales in China.

Additionally, pharmaceutical giant Eli Lilly will disclose sales of its blockbuster weight loss and diabetes drugs this week.

 

In other markets …

Gold price fell by -0.1% to US$2,335.31 an ounce.

Oil prices dropped -1%, with Brent crude now trading at US$88.32 a barrel.

The benchmark 10-year US Treasury yield was down 3 basis points (bond prices higher) at 4.62%.

The Aussie dollar climbed further by +0.5% to US65.67 cents.

Bitcoin meanwhile was down -0.15% in the last 24 hours to US$63,656.

 

5 ASX small caps to watch today

Marmota (ASX:MEU)
Marmota announced that, as part of its Project X regional reconnaissance program, drilling at Target 5, ‘Goolagong’, on EL 5818 (100% owned) has yielded a potential new gold discovery. The last 2 metres drilled in Hole 23MR184 returned significant gold, with the grades notably increasing to the end of hole at 38m: 2m @ 0.64g/t gold From 36m downhole to end of hole, and from 36m to 37m: 0.53g/t gold.

Dynamic Group (ASX:DDB)
The mining services company says new contracts were awarded with a total approximate value of $11.1m to $12.9m. This takes its contract awards to $87.4m to $97.1m since the start of Q3 FY24, which sets a solid foundation for Q4 FY24 and into FY25.

Argent Minerals (ASX:ARD)
Argent says all 12 Reverse Circulation (RC) drill holes completed over the Kempfield Deposit have intersected shallow, broad thick high-grade zones of silver-lead-zinc mineralisation up to 88m thick from surface from the Western Lode area, and 29m thick high-grade silver-base metal mineralisation located northeast of the Lode 200 Resource Area. Significant results from the RC drilling include: Drillhole AKRC230: 23m @ 34.41g/t Ag from 22m.

Anson Resources (ASX:ASN)
Anson says it has successfully extracted brine from Mississippian Units at its Green River Lithium Project. Supersaturated brine was sampled at the Green River Lithium Project which was drilled to a total vertical depth of 3,416.81m, and continued to flow into the tubing. The flow of supersaturated brine confirms Anson’s expectations that Green River will be 
the location of its second lithium project in Utah.

Vanadium Resources (ASX:VR8)
VR8 has signed a non-binding MOU for the offtake of V2O5 production from its Project with Enerflow Technology, a subsidiary of Tian’en Energy. The MOU provides for the supply of 4ktpa of V2O5 flake over a period of five years with an option for Enerflow to extend a further five years. VR8 also emains in discussions for further offtake MOUs and agreements with a variety of Chinese, Japanese, Korean and European end-users and traders for the balance of its planned production.

 

At Stockhead we tell it like it is. While Argent Minerals and Anson Resources are Stockhead advertisers, they did not sponsor this article.

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