Market Highlights: Wall Street bulls are back after Fed minutes, and 5 ASX small caps to watch today

ASX to open higher following Wall Street’s gains
Disney and Walmart each rose 1pc, Zoom Video climbed 3pc
Franklin Templeton says rate cuts during expansions usually boost markets

The ASX is set to rise at Thursday’s opening, following Wall Street’s gains. At 8am AEST, the SPI ASX200 futures contract was pointing up by 0.4%.

This came after US employment data released overnight showed the labour market was slowing down, increasing expectations that the Fed Reserve will lower rates next month.

The S&P 500 ended the day 0.42% higher, the blue chips Dow Jones rose by 0.14%, and the tech heavy Nasdaq climbed by 0.57%.

Wall Street traders also reviewed the minutes from the most recent Fed meeting.

The minutes revealed that some officials had seen a reasonable argument for lowering rates in July, but the central bank ultimately chose to keep rates unchanged with a unanimous vote.

“The Fed minutes removed all doubt about a September rate cut,” said Jamie Cox at Harris Financial.

Bret Kenwell at eToro added, “The question isn’t whether the Fed will cut rates in September, but rather, how much will the Fed cut?”

All eyes will now turn to Jerome Powell’s speech in Jackson Hole on Friday.

To stocks, Walt Disney rose 1% after appointing James Gorman, the former CEO of Morgan Stanley, to head the committee responsible for finding a successor to current CEO Bob Iger.

Zoom Video jumped 3% post-trading after providing a sales forecast that exceeded analysts’ expectations, driven by the company’s expansion of its product offerings.

Apple Inc’s shares saw little change as the head of the App Store left amid a company reorganisation of the profitable division, which has been under regulatory scrutiny for its dominant role in the mobile software market.

Ford Motor Co rose 1.5% after revising its electrification strategy once more, scrapping plans for a fully electric SUV in a move that could cost the company approximately US$1.9 billion.

And, Walmart Inc. increased by 1% after raising about US$3.6 billion from selling its stake in Chinese e-commerce company JD.com Inc.

Back home, earnings season continues with SkyCity, Medibank, Northern Star and Super Retail among the companies set to release their results today.

Fed rate cut during expansion will boost markets – Franklin T

As investors anticipate a possible interest rate cut by the Fed Reserve in September, Franklin Templeton Institute‘s new study has offered insights based on historical data.

The research shows that when the Fed cuts rates during an economic expansion, both stocks and Treasury bonds generally perform well.

Historically, rate cuts during expansions have often led to rising equity markets, with sectors like large-cap and growth stocks seeing significant gains.

Meanwhile, Treasuries, which usually benefit from lower interest rates, also tend to perform well, often surpassing equities during the worst market downturns.

“It might be wise to add to equity positions if the market initially declines following the first rate cut,” said Chris Galipeau, Senior Market Strategist at Franklin Templeton Institute.

“Historically, equities have typically rallied six and 12 months after the first cut, regardless of whether the economy remained in expansion or entered a recession.”

In other markets …

Gold price rose by 0.1% to US$2,513.36 an ounce.

Oil prices fell almost 2%, with Brent crude now trading at US$76.01 a barrel.

The benchmark 10-year US Treasury yield was flat at 3.81%.

The Aussie dollar was flat at US67.49 cents.

Bitcoin meanwhile lifted by 3% in the last 24 hours to US$61,400, and Ethereum jumped by 2% to US$,640.

5 ASX small caps to watch today

Critical Resources (ASX:CRR)
CRR has announced impressive results from its Tot pegmatite site in Ontario. Recent tests revealed high-grade lithium with a standout sample showing 3.79% lithium oxide (Li2O) over one meter. The pegmatite is now exposed along 50 meters and is about 8 metres wide, demonstrating significant high-grade mineralisation. Plans are underway for targeted drilling across the Mavis Lake Project Area, with new anomalies and follow-up targets identified at both Tot and Gullwing prospects.

Sun Silver (ASX:SS1)
SS1 has announced strong results from its first drilling at the Maverick Springs Project in Nevada. The initial hole, MR24-186, hit a broad zone of 41.15 metres at 126.75 grams per ton of silver equivalent (AgEq), with a notable 13.42 metres at 331.76 g/t AgEq. Another hole, MR24-188, intersected 54.86 metres at 83.89 g/t AgEq. These results confirm high-grade silver extends beyond the current resource, supporting further exploration.

Cycliq Group (ASX:CYQ)
Cycliq, a company specialising in smart safety and action cameras for cycling, has signed a 10-year deal with BeEmotion to integrate AI into its Fly cameras and edge devices. This technology will enhance Cycliq’s products, including the Fly6 Gen3 and Fly12 Sport, by improving object detection and real-time threat analysis. The partnership also aims to boost the UpRide platform with better vehicle data and incident tracking.

Strickland Metals (ASX:STK)
Strickland has updated its exploration progress at the Rogozna Gold and Base Metals Project in Serbia. The company recently drilled a new hole at the Shanac deposit, which revealed promising results. The drilling uncovered a significant 90.9 metres of copper-gold mineralisation with grades of 1.4 grams per ton of gold and 0.3% copper. There was also a discovery of high-grade gold-zinc-lead-silver mineralisation at a depth of 482.9 metres. The company is now drilling a follow-up hole to explore an extension of the high-grade gold skarn found in a previous drill.

Osteopore (ASX:OSX)
Osteopore has completed successful pre-clinical studies in collaboration with the University of Chile. This work is part of a project funded by a US$360k grant from the Government of Chile and the University of Chile, aimed at developing a new type of 3D-printed bone implant designed to accelerate bone regeneration. The studies have shown that the new implant materials are compatible with bone, and promote faster bone growth. Specifically, they increased cell adhesion and bone-mineralising activity significantly compared to baseline levels. Osteopore now plans to start clinical trials in the latter half of 2025.

At Stockhead we tell it like it is. While Sun Silver and Strickland Metals are Stockhead advertisers, they did not sponsor this article.