Market Highlights: Tesla surges after Q1 update, iron ore slumps, and 5 ASX small caps to watch today

ASX to extend gains on Wednesday after Wall Street bounced back
Tesla surged by 11pc after releasing quarterly results
And where will the S&P 500 index be at year end?

Aussie shares are set to extend their good run on Wednesday as Wall Street continues to bounce back. At 8am AEST, the ASX200 futures contract was pointing up by +0.4%.

Overnight, the S&P 500 rose by +1.20%, the blue chips Dow Jones index was up by +0.69%, and the tech-heavy Nasdaq lifted by +1.59%.

Tesla kicked off the reporting season for the Magnificent 7.

Tesla’s shares surged over +11% after-hours despite a revenue miss for the quarter. The EV maker posted US$21.3bn in revenue for Q1, a 9% drop year on year. Profit was US$1.1bn, a huge 55% decline from the pcp.

However, there were several things in the release that made investors happy, including a ride-hailing app to be integrated into Tesla’s products, the robotaxi, and the release of new vehicle models that will be launched sooner than previously announced.

Spotify also soared +11% after reporting Q1 earnings that beat expectations on both the top and bottom lines.

General Electric jumped 8% after beating both profit and revenue forecasts and lifted its full-year guidance.

General Motors lifted +4% after also posting a beat on both the top and bottom lines and raised its full-year outlook.

Meanwhile, iron ore stocks will be on watch today after the iron ore price slumped -3% overnight on the back of slowing Chinese steel market.

“Steel consumption was suppressed in the short term as rainy weather hit southern [Chinese] regions, which also dented speculative buying,” analysts at Huatai Futures said in a note.

Looking ahead, Australia’s March quarter CPI figures will be released at 11.30am AEST today. The last reading showed a CPI of 3.4% in the 12 months to January 2024.

S&P 500 year-end prediction

Goldman Sachs’ analysts say another bull run in US megacaps could push the S&P 500 index 15% higher than its forecast year-end level of 5,200 (currently at 5,070).

“A large part of the market remains weighed down by concerns of ‘high-for-longer’ rates and an elevated cost of capital as investors seek quality attributes,” Goldman noted.

“That’s one area where a change might help stocks go higher.”

A surge in earnings in megacaps, especially the Magnificent Seven, is also expected to drive a 13% rise in buybacks by S&P 500 companies, which could take the index even higher.

In other markets …

Gold price fell by -0.53% to US$2,321.39 an ounce.

Oil prices also rose by +1.5%,with Brent crude now trading at US$88.43 a barrel.

The benchmark 10-year US Treasury yield traded flat at 4.61%.

The Aussie dollar climbed further by +0.6% to US64.89 cents.

Bitcoin meanwhile was down -0.5% in the last 24 hours to US$66,439.

5 ASX small caps to watch today

Mako Gold (ASX:MKG)
Mako announced the discovery of a new high-grade gold zone (Central Zone) at Tchaga North on the Napié Project, which further confirms Tchaga North as a high-grade drill target. High grade rock chip results include 76.10g/t Au, 24.34g/t Au, 12.95g/t Au, 6.92g/t Au, 5.49g/t Au, 5.11g/t Au, and 4.55g/t Au.

Immutep (ASX:IMM)
Immutep has announced preliminary topline results from Cohort B of the TACTI-003 Phase IIb trial evaluating eftilagimod alpha (efti) in combination with KEYTRUDA (pembrolizumab). Results showed a preliminary 26.9% response rate, the primary endpoint of the study. Immutep says these results are encouraging. The drug combination is aimed at first-line treatment of recurrent/metastatic head and neck squamous cell carcinoma patients (1L HNSCC) with negative PD-L1 expression.

Avira Resources (ASX:AVW)
Avira has entered into an Earn-In Agreement with Goitom Mining to earn up to an 80% interest in the Meru Copper-Gold Project (Meru) located in central Kenya. Meru is a single 251 square kilometre prospecting licence under application in central Kenya that is 100% held by Goitom. A single grab sample was taken and returned 10.32% Cu; 4.68g/t Au; 1.03ppm Pd; 1.78ppm Pt; 2ppm Ag and 2090ppm Ni.

Predictive Discovery (ASX:PDI)
PDI reported further near-resource drilling results from the 5.38Moz Bankan Gold Project in Guinea. BC East reverse circulation drilling results produced 9m @ 3.36g/t from 17m and 10m @ 1.43g/t from 85m, following up positive previous results including 16m @ 1.58g/t from 5m.

Buru Energy (ASX:BRU)
Interpretation of the Rafael 3D seismic data set identifies a high potential, shallow prospect in EP 428 (100% owned by Buru), partly overlying the Rafael 1 gas and condensate accumulation, with planning underway for drilling of the prospect in the 2024 operating season. Buru’s internal assessment indicates a range of between 3.2 MMstb (low estimate) and 79 MMstb (high estimate) of recoverable liquids with a Best Estimate of 19 million barrels recoverable.

At Stockhead we tell it like it is. While Mako Gold is a Stockhead advertiser, it did not sponsor this article.