ASX down 0.04% as REITS tumble 1.5%

Market Reports

by Peter Milios

The S&P/ASX 200 is 0.04 per cent lower at 7,032.20.

Bond yields in the US continue to drop, leading to increased speculation that interest rate cuts may happen sooner than anticipated.

The US 10-year yield has fallen below 4.3%, decreasing by 57 basis points in the last month. Billionaire investor Bill Ackman has expressed the belief that the Federal Reserve will need to cut rates more quickly than expected. This sentiment is prevailing despite recent data showing the US economy grew at a robust 5.2% annualised rate in the third quarter. Both stocks and bonds rallied due to the expectation of a potential change in Fed policy, with the market now pricing in a 25 basis point rate cut in May 2024 and abandoning the idea of higher rates in the foreseeable future, according to ANZ.

The SPI futures are pointing to a fall of 6 points.

Best and worst performers

The best-performing sector is Industrials, up 0.68 per cent. The worst-performing sector is REITs, down 1.5 per cent.

The best-performing large cap is BlueScope Steel (ASX:BSL), trading 2.56 per cent higher at $20.83. It is followed by shares in Cochlear (ASX:COH) and ResMed (ASX:RMD).

The worst-performing large cap is Lynas Rare Earths (ASX:LYC), trading 3.02 per cent lower at $6.42. It is followed by shares in AGL Energy (ASX:AGL) and REA Group (ASX:REA).

Asian news

Asia-Pacific markets fell across the board on Thursday ahead of key economic data from the region.

China will release its November purchasing managers’ index reading later in the day, while Japan saw its October retail sales climb lower than expected at 4.2% year-on-year.

South Korea’s industrial output numbers surprised the market, registering a 3.5% fall compared to expectations of a 0.5% rise from economists polled by Reuters. The country will also see its central bank announce its rate decision today.

Japan’s Nikkei 225 slid 0.25% and extended its three-day losing streak, with the Topix also down by 0.14%.

South Korea’s Kospi also fell 0.29%, while the small-cap Kosdaq was marginally above the flatline.

Futures for Hong Kong’s Hang Seng index stood at 17,108, pointing to a rebound after the HSI hit a one month low on Monday and closed at 16,993.44.

Company news

Australian Pacific Coal (ASX:AQC) secured a 3-year USD60 million (~AUD90 million) debt facility from Vitol Asia, a global energy and commodities company, for its Dartbrook Joint Venture in the Hunter Valley, which produces high-quality thermal coal. The Funds will cover all remaining restart capex through to first coal and the acquisition of additional mining systems during ramp-up. Shares are trading 25 per cent higher at 17.5 cents.

Augustus Minerals (ASX:AUG) announced that a review of soil sampling data completed by the Company has returned high tenure lithium and rubidium results in and around the Peak Bore prospect area. Looking ahead, the technical team is already working up exploration programs for 2024 and will use this data to redefine their priorities in this area.Shares are trading 9.09 per cent higher at 12 cents.

Battery Age Minerals (ASX:BM8) announced multiple +20m spodumene-bearing pegmatite intercepts at its 90%-owned Falcon Lake Lithium Project in Ontario, Canda, highlighting the potential scale of the mineralised system. In response, Battery Age Interim CEO, Nigel Broomham, commented, “the team has only just begun to scratch the surface, and we believe the recent results highlight the potential to identify discoveries of scale at Falcon Lake.” Shares are trading 2.13 per cent higher at 24 cents.

Commodities and the dollar

Gold is trading at US$2065.10 an ounce.

Iron ore is 0.8 per cent higher at US$130.45 a tonne.

Iron ore futures are pointing to a 0.4 per cent fall.

One Australian dollar is buying 66.17 US cents.

Peter Milios

Peter Milios is a recent graduate from the University of Technology - majoring in Finance and Accounting. Peter is currently working under equity research analyst Di Brookman for Corporate Connect Research.

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