• The ASX to open flat today as Wall Street retreated on Friday
  • A Bank of America analyst says current market looks more like 2000 or 2008
  • Ford says the US is “not quite yet ready” to compete with China in EVs


Australian shares are poised to open flattish this morning after Wall Street took a breather.

At the close on Friday, the S&P 500 was down -0.37%, and tech heavy Nasdaq finished -0.68% lower ahead of the long Juneteenth holiday weekend.

Experts think the recent stock market rally seems a bit overextended, but too much money still remains on the sidelines.

“This means if the AI trade remains intact, this winning streak for mega-cap tech stocks can last a while longer,” said Oanda analyst, Edward Moya.

Bank of America analyst Michael Hartnett however said he wasn’t convinced that we’re in a new bull market.

“The current market looks more like 2000 or 2008, with a big rally before a big collapse,” Harnett warned.

To stock news, Spotify rose 3% after parting ways with the  production company founded by Prince Harry and Meghan Markle, Archewell Audio.

Disney fell -2% after announcing the departure of its longstanding CFO, Christine McCarthy.

Shares of Virgin Galactic surged 16.5% after announcing that it will launch commercial space operations later this month.

Meanwhile,  the Consumer Sentiment Index in the US came in at 63.9, versus forecast of 60.5 – suggesting that there’s hope of a soft landing.


China to dominate EVs

Ford Motor executive chairman Bill Ford Jr said the US is “not quite yet ready” to compete with China in the production of electric vehicles (EVs).

“They developed very quickly, and they’ve developed them in large scale, and now they are exporting,” Ford told CNN on the weekend.

Projections show that China will become the world’s No 2 exporter of passenger vehicles, and will challenge traditional car exporters such as Japan and Germany.

China’s electric cars are already selling well, with the Chinese brand BYD poised to overtake Tesla this year as the world’s top EV maker.

In terms of market cap, BYD’s market cap of US$760bn trails behind only Toyota and Tesla.


In other markets …

Crude oil prices pared gains, down by -0.5%, after maintenance work caused refinery outages across Asia.

Gold price was flat at US$1,957.58.

“Gold won’t be attracting safe-haven flows until this stock market breaks, and that might not if the AI trade remains intact,” said Moya.

Bitcoin meanwhile was down half a per cent in the last 24 hours to US$26,413.

MicroStrategy’s Michael Saylor has issued a 10x price increase for BTC, and said it could happen very quickly.

“I have confidence that the crypto exchanges will come around to realising that Bitcoin really is the dominant asset in this space, and their business models are fine when Bitcoin goes up by a factor of 10,” Saylor told Bloomberg.


5 ASX small caps to watch today

Dubber Corporation (ASX:DUB)
The Saas company says it’s on track to deliver a record revenue result of $30m in FY23, with an annualised exit revenue run-rate of $36m based on expected revenues for June. Q4 FY23 revenue expected to be up 20% on Q3 FY23. The company also says it’s on track to achieve cash flow break even during FY25 within existing cash reserves.

Lithium Power (ASX:LPI)
LPI announced that it has entered into a binding agreement to sell its wholly-owned Australian subsidiary, Western Lithium, to Albemarle Lithium for an all cash-for-shares transaction of $30m. LPI said the proceeds will result in a healthy cash balance as the company progresses to finance and construct its flagship Maricunga lithium brine project in Chile.

FINEOS Corporation (ASX:FCL)
The tech company focusing on the insurance sector announced that Guardian Life Insurance Company of America has signed an agreement to implement the FINEOS platform for its absence products. FINEOS also notes that its results to mid-June support delivery of revenue nearer the lower end of the range of €124 million to €128 million communicated to the market in February.

AVITA Medical (ASX: AVH)
The regenerative medicine company said the US FDA has approved its application for premarket approval (PMA) of its RECELL System for the treatment of vitiligo. The PMA approval was based upon results from the company’s pivotal trial of the RECELL System.

Gold 50 (ASX:G50)
Wide-spaced drilling at the Golconda Project has intersected high-grade gold-silver mineralisation within several broad mineralised zones including: 35m at 5.2g/t gold and 5.9g/t silver from 176.8m, including 9m at 19.5g/t gold and 17.8 g/t silver in GRC06.