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Headlines
- ASX 200 Predicted to Drop; S&P 500 Suffers Worst Day Since 2022
- Market Turmoil: S&P 500 Plummets, ASX 200 Expected to Follow
- Newmont and Fortescue Quarterly Reports in Focus Amid Market Decline
ASX 200 futures are trading 75 points lower, down 0.95% as of 8:30 am AEST. The S&P 500 experienced its first 2% drop in 365 days after disappointing earnings from Tesla and Alphabet dampened momentum in big tech stocks. Additionally, the Bank of Canada cut interest rates by 25 bps for the second consecutive month. On a brighter note, Newmont's Q2 earnings exceeded analyst expectations, while Ampol warned of first-half results falling short of consensus, with more quarterly reports to follow.
OVERNIGHT MARKETS
- Major US benchmarks ended lower, near their worst levels of the day.
- The S&P 500 fell over 2% for the first time in a year, and the Nasdaq saw its worst performance since October 2022, with over US$1.1 trillion wiped from US markets.
- The "Magnificent 7" stocks fell between 2-12%, led by Tesla's 12.3% drop.
- Big-tech earnings from Tesla and Alphabet were disappointing, dragging down sentiment despite high expectations and positive commentary on long-term growth.
- Economic growth concerns emerged as Visa reported a July spending slowdown and Lamb Weston noted weak restaurant traffic.
- The US 2-year yield dropped 6 bps while the 10-year rose 3 bps, making the 2-and-10 year spread the least inverted since July 2022.
- Copper fell for the eighth consecutive session, its longest losing streak since February 2020, down 10.5% since July 12.
ASX TODAY
- Ampol reports an unaudited half-year RCOP EBIT of approximately $500-510 million (ASX:ALD).
- Bellevue Gold plans to raise up to $200 million to repay debt (ASX:AFR).
- Coronado reports Q2 ROM production of 7.2Mt, up 23.8% quarter-on-quarter (ASX:CRN).
- Lynas Rare Earths holder Georgina Rinehart discloses purchase of 12.3 million shares, raising her stake from 5.8% to 7.1% (ASX:LYC).
- Macquarie issues a Q1 update, with performance consistent with expectations (ASX:MQG).
- Next Science reports Q2 sales of $5.8 million, up 5% year-on-year, reaffirming full-year guidance and positive cash flow for the second half (ASX:NXS).
WHAT TO WATCH TODAY Brace for a tough session, though S&P 500 sectors like Utilities, Healthcare, Energy, and Staples finished higher overnight, suggesting a challenging but not disastrous day for local stocks.
- Ampol: The first-half EBIT of $505 million (mid-point) significantly misses Macquarie's forecast of $618 million (data from May).
- Newmont: NYSE-listed Newmont shares rose 0.6% after hours following a Q2 earnings report that exceeded consensus by 16%, with gold production in line with expectations. Watch for potential gains in local Newmont shares.
- Sub-sector selloffs: Our overnight ETF watchlist showed many sectors down 2-5%, including Lithium, Uranium, Fintech, Steel, Cloud, and more, potentially leading to a weak open for local stocks.
- More to come: More quarterly reports are expected before market open, with attention on potential dividends or capital management updates from Karoon Energy and clarity on Fortescue's green hydrogen strategy.
