• ASX to open slightly lower after a retreat on Wall Street
  • Fed officials said they are open to more rate hikes
  • Nvidia earnings in focus


Aussie shares are poised to slip on Wednesday after US stocks retreated on Wall Street. At 8am AEDT, the ASX 200 index futures was pointing down by -0.1%.

In New York, the S&P 500 fell by -0.2%, the blue chips Dow Jones index was down by -0.18%, and the tech-heavy Nasdaq slipped by -0.59%.

The US Fed Reserve released its minutes from the November meeting, which revealed that board members have not shut the door on another rate hike.

During the meeting, FOMC officials agreed that further rate hikes would be appropriate if data suggested that progress toward the 2% inflation was insufficient.

The Fed’s message was echoed by European Central Bank president Christine Lagarde overnight.

“This is not the time to start declaring victory,” Lagarde said in a speech. “We need to remain focused on bringing inflation back to our target, and not rush to premature conclusions based on short-term developments.”

To stocks, and Nvidia was down almost -1% ahead of its much anticipated Q3 report later today.

“Nvidia’s upcoming earnings report is a pivotal moment for investors to assess the company’s standing in the dynamic semiconductor landscape,” said de Vere’s Nigel Green.

AI-focused stock Symbotic surged 40% on after reporting its first profit since going public in June 2022.

Elon Musk’s X is suing media watchdog Media Matters after the non-profit said that ads on X often appear alongside antisemitic content.

And OpenAI saga continues as Microsoft CEO Satya Nadella hinted he was open to Sam Altman rejoining the ChatGPT maker.


Can we still rely on China?

For most of the past 40 years, the market has become used to the idea of China as a fast-growing, emergent economy.

Recently, however, a different story has surfaced. This one portrays China as stumbling badly, weighed down by long-term challenges.

In a new recent paper uncovering China, Christy Tan, investment strategist at the Franklin Templeton Institute says the truth about China is neither as optimistic as some had earlier believed, nor as pessimistic as is currently fashionable.

“Rather, the central narrative is one of China in transition,” Tan said.

“China is shifting from an economy underpinned by extraordinarily high and probably unsustainable rates of savings, investment and debt accumulation to something else.”

As such, Tan said that  opportunities and risks related to China investment strategies is fundamentally shifting.

“China faces challenges but has extraordinary potential. Its odds of overcoming its challenges are greater than many think.”

Going forward however, the investment landscape on China will likely change, said Tan.

“A China in transition away from investment encumbered by mounting loan losses is unlikely to see the rapid growth rates for basic materials, other commodities and energy.

“To be sure, China’s absolute levels of demand probably won’t fall off a cliff, but the period of rapid growth has already come to an end,” Tan said.


In other markets …

Gold price rose +1.06% to US$1,998.24 an ounce.

The benchmark US 10-year treasury yield rose 4 basis points to 4.40%

Oil prices were flat, with Brent now trading at US$82.50 a barrel.

Oil traders are waiting to see whether the OPEC+ led by Saudi Arabia will intervene to bolster prices after crude prices slumped by 10% over the past month at its 26th November meeting.

Iron ore futures rose 0.2% to US$129.55 a tonne.

The Aussie dollar slipped slightly to US65.57c.

Meanwhile, Bitcoin was down -1.25% in the last 24 hours to US$36,962.


5 ASX small caps to watch today

Race Oncology (ASX:RAC)
Race announced that Dr Daniel Tillett has been appointed full-time CEO, effective immediately. Dr Tillett brings more than 25 years of experience in the biotech industry and is the founder of Nucleics, an Australian biotechnology company focused on DNA sequencing and genomics. He replaced Damian Clarke-Bruce and has requested that only 50% of his salary be paid in cash, and the remaining 50% be provided as options on RAC with an exercise price of $4.25, above the all-time high share price.

Invex Therapeutics (ASX:IXC)
Invex has been granted a patent from the European Patent Office for “Elevated intracranial pressure treatment”. The patent provides additional claims for the use of Exenatide and other GLP-1 receptor agonists in reducing elevated intracranial pressure (ICP) associated with the treatment of hydrocephalus, normal pressure hydrocephalus, or meningitis. The hydrocephalus market was worth US$3.3 billion globally in 2022.

Turners Automotive (ASX:TRA)
The NZ used car dealership reported record NPAT of $25.7m for the first half of FY24, 10% ahead of HY23 despite a challenging macro environment. The company has also reaffirmed its guidance from October that FY24 result will be ahead of record FY23 result, and that forecasted dividend at this level of profit will be at least 24 cents per share (+4%).

Hammer Metals (ASX:HMX)
Detailed mapping has delineated the surface extent of a large LCT pegmatite field on the western side of the Hammer Metals Orelia Target 1 prospect, part of its 100%-owned Yandal Project in WA. Over 100 pegmatite occurrences were mapped over an area of 1.4km by 600m, coincident with an anomalous lithium-in-soil response. Soil sampling has confirmed prospective target horizons with coherent anomalies delivering maximum lithium-soil anomalies of up to 137ppm Li2O.

Alchemy Resources (ASX:ALY)
Alchemy said excellent progress continues to be made with its lithium exploration at the Lake Rebecca Projects in WA. Project-wide soil geochemistry programs are now underway, and expected to be completed by the end of November. No exploration for lithium has historically been carried out here, with the majority of the tenure having only ever been explored for gold. Previous soil sampling on the southern areas at Middle Tank Prospect has identified lithium in soils anomalism with an area of interest characterised by a coincident Li-Cs-Ta, Rb and Rb/K ratio, along with elevated gold related pathfinder elements.