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Highlights
- ASX poised to climb as US markets rally overnight.
- US tech and healthcare stocks shine, bolstering sentiment.
- Oil prices slide as energy policies raise output concerns.
The Australian stock market is set for another positive day, with ASX futures pointing to a rise of 32 points or 0.4% following a 0.7% gain yesterday. The optimism comes after a strong performance in US markets, where investors analyzed the initial executive actions of President Donald Trump and monitored developments in trade policies.
Trump has proposed imposing a 25% tariff on imports from Canada and Mexico, potentially starting on February 1, though further clarity is awaited. Meanwhile, his discussions with China regarding broader trade terms are expected in the coming weeks.
US markets ended higher overnight, buoyed by strong earnings reports and sector-specific gains. The Dow Jones surged by 538 points or 1.2%, while the S&P 500 advanced 0.9% and the Nasdaq gained 127 points or 0.6%. Major contributors to this rally included Vistra Corp (NYSE:VST), which saw an 8.5% rise after its Moss Landing battery storage facility resumed operations following a fire-related evacuation. Oracle (NYSE:ORCL) gained 7.2% on reports of its collaboration with OpenAI and SoftBank to build artificial intelligence infrastructure. Moderna (NASDAQ:MRNA) rose 5.3% after securing $590 million from the US government to accelerate its bird flu vaccine development. On the downside, Apple (NASDAQ:AAPL) slipped 3.2% due to a broker's rating downgrade, while Walgreens (NASDAQ:WBA) fell 9.2% as it faced allegations of unlawfully dispensing addictive painkillers.
In Europe, markets posted modest gains, driven by strength in the healthcare and luxury goods sectors. The continent-wide FTSEurofirst 300 index rose 0.4%, with London’s FTSE 100 adding 0.3%. Novo Nordisk (CPH:NOVO-B) advanced by 4% following strong performance in the healthcare sector. Luxury stocks also saw robust growth, with Burberry (LSE:BRBY) surging 5.3%. However, automakers like Volkswagen (ETR:VOW) and BMW (ETR:BMW) declined amid lingering concerns over potential US tariff measures.
On the commodities front, crude oil prices fell after Trump’s declaration of a national energy emergency raised fears of increased US output in an already oversupplied market. Brent crude dropped 1.1% to $79.29 a barrel, while Nymex crude lost 2.6% to $75.89 a barrel. Gold prices climbed to a two-month high of $2,759.20 per ounce, supported by a weaker dollar and uncertainty around trade. Iron ore futures remained stable at $101.21 a tonne.
In the small-cap sector, Sovereign Metals (ASX:SVM) reinforced its potential to lead global rutile and graphite production with promising pre-feasibility results from its Kasiya Project. AuMEGA Metals (ASX:AGM) unveiled a robust exploration strategy in Canada, while Orthocell (ASX:OCC) anticipated US FDA approval for its Remplir™ product in the coming months. Pantoro (ASX:PNR) announced the appointment of Stuart Mathews, an experienced mining professional, to its board.
The combination of positive earnings results, evolving trade policies, and sector-specific highlights continues to influence market momentum.
