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19 June Markets at a glance
Around the grounds
- ASX flat to negative
- Energy gains, financials fall
- AUD marches higher after a hawkish RBA
- Nvidia eclipses Microsoft as world’s most valuable company
The S&P/ASX200 is relatively flat as the index struggles to find direction with gains in mining and gold stocks helping pare earlier losses.
Investors remain cautious as they continue to digest the Reserve Bank of Australia’s (RBA) hawkish hold yesterday where the central bank held interest rates steady at a 12-year high of 4.35%, but reiterated risks to inflation.
Energy players are higher and on track for their sector second consecutive session of gains, as the sub-index tracks a rise in the price of oil amid escalating geopolitical risk in Europe and the Middle East where wars continue to threaten global supply.
Miners and gold stocks are also up, while interest-rate sensitive financials trading a tick lower.
The Australian dollar continues to march higher after yesterday’s interest rate decision and has touched an April 2013 high against the Japanese yen.
In the news
Australian listed shares of Downer EDI (DOW) are among the day’s top performers as the contracting firm confirms it was awarded a new NBN contract with an estimate value of more than AU$100 million. The stock is up nearly 6.5% this year as of last close.
Fortescue Ltd (FMG) shares are also higher, recovering some lost ground from yesterday’s slide. This after US-based Capital Group Companies sold some AU$733 million shares in the miner. It comes after the AFR reported yesterday an institutional investor had sold off a AU$1.1 billion stake in the company.
FMG shares have tumbled nearly 25% so far this year thanks to a softer iron ore price on the back of dampened demand in China.
QBE Insurance Group (QBE) shares have touched a two-week low as the insurance company announces the closure of its struggling North America middle-market. The closure will see around AU$100 million before tax in its FY24 results. Looking ahead QBE has forecast its first-half gross written premium to rise by 3% on a constant currency basis.
The stock is up 24% this year as of last close.
And AFT Pharmaceuticals (AFP) is trading ex-dividend.
Going global
In the US, the tech rally continues with Nvidia (NVDA) eclipsing Microsoft as the world’s most valuable company. Shares climbed to US$135.58 per share, lifting its market cap to US$3.3 trillion.
The stock has nearly tripled in 2024 alone, compared with Microsoft’s (MSFT) 19% gain.
The company is also the most traded on Wall Street, with a daily turnover averaging around US$50 billion, compared to US$10 billion each for Apple (AAPL), Microsoft and Tesla (TSLA).
On global currencies, the US dollar is nursing some losses after soft retail sales data again reinforced bets the FOMC will cut rates this year. Futures see a 67% chance the Fed will begin easing rates in September according to the CME FedWatch tool.
Sterling is marginally lower ahead of UK inflation data and the Bank of England (BoE) decision tomorrow, while the euro continues to tread water.
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