AUS
NZ
UK
CA
USA
FRA
GER
ESP
ITA
NLD
PRT
SWE
GRC
IND
POL
BRA
ZAF
RUS
CHN
UAE
Highlights
- US markets surged on AI enthusiasm and strong economic data.
- Copper and lithium stocks saw significant gains.
- Oil prices dropped as supply concerns eased.
The ASX is expected to open on a strong note, fueled by optimism from Wall Street’s rally. US markets saw substantial gains on Thursday, driven by excitement surrounding artificial intelligence (AI) and favorable economic data.
US Markets Record Strong Performance
All three major US indices posted solid gains. The S&P 500 reached a new all-time high, climbing 0.4% to close at 5,745. Meanwhile, the Dow Jones increased by 260 points (0.6%), and the Nasdaq rose by 108 points (0.6%).
Micron Technology’s (NASDAQ:MU) impressive earnings forecast fueled enthusiasm for AI-related stocks. The company’s stock soared 14.7% after reporting stronger-than-expected revenue projections, signaling robust demand for memory chips used in AI computing. This helped boost overall market sentiment.
Investor confidence was further bolstered by positive US job data. Initial jobless claims dropped by 4,000 to 218,000, better than the forecast of 223,000. Additionally, the US economy grew at an annualized rate of 3.0% in the June quarter, slightly exceeding expectations.
Gains in Copper and Lithium Stocks
Copper mining giant Freeport-McMoRan (NYSE:FCX) saw its stock jump 7.5%, while lithium producers Albemarle (NYSE:ALB) and Arcadium Lithium gained 9.9% and 8.9%, respectively. These gains were supported by growing demand in the metals market, particularly for copper and lithium, which are crucial for the energy and tech sectors.
The upbeat sentiment extended to European markets, with China-exposed luxury brands such as LVMH (EPA:MC) and Hermes (EPA:RMS) rising by 9% each, contributing to a 1.3% increase in the FTSEurofirst 300 index.
Oil Prices Decline Amid Supply Easing
Global oil prices experienced a significant drop of over 2% after reports suggested that Saudi Arabia might abandon its target of US$100 per barrel in order to boost output. Brent crude fell to US$71.60 per barrel, while US Nymex crude dropped to US$67.67 per barrel.
Supply disruptions in Libya, which had supported oil prices in recent weeks, appear to be easing, and there is growing speculation that Saudi Arabia may proceed with planned production hikes in December. This has unsettled the market, contributing to the decline in oil prices.
Metals and Commodities Surge
China's recent economic stimulus measures, including monetary policy easing, gave a strong boost to the metals market. Copper surged back above US$10,000 per tonne, with copper futures climbing 3.5%. Aluminium prices also jumped by 3.7%, while silver reached US$32 per ounce, its highest level since 2012.
Meanwhile, gold benefited from global interest rate cuts, which increased demand for bullion. Gold futures rose by US$10.20 (0.4%) to US$2,694.90 per ounce, with spot gold trading near US$2,672 per ounce after hitting a record high earlier in the day.
Iron ore prices also strengthened, reaching US$100 per tonne, with iron ore futures rising by 0.3% to US$92.54 per tonne. China’s economic measures have helped to inject confidence into the market, supporting further gains across the commodity sector.
With renewed enthusiasm for AI, positive economic data, and strong performances in metals and commodities, global markets are on a positive trajectory. However, the drop in oil prices amid easing supply concerns presents a mixed picture for energy markets. The ASX is expected to benefit from this global momentum, opening higher and riding the wave of investor optimism.
