ASX 200 futures flat, S&P 500 scores fourth straight record close

ASX 200 futures are trading 8 points lower, down -0.10% as of 8:30 am AEST.

S&P 500 SESSION CHART

OVERNIGHT MARKETS

• US stocks finished mixed but not far off best levels after some midday weakness
• Breadth remains a concern – Nasdaq 100 is up 3% so far this week and traded higher on all four trading days but breadth has been 50/50, according to Bespoke
• Broadcom (+12.2%) is the latest AI bright spot after topping Q2 earnings expectations and upgrading its FY24 guidance – AI semiconductor revenue of US$3.1bn was up 35% quarter-on-quarter and 280% year-on-year
• Market struggled for momentum despite more signs of disinflation momentum from cooler-than-expected US PPI data – poor breadth, cyclical underperformance and upcoming buyback blackout period remain the key areas of concern
• Bond yields down for a fourth straight session – the US 2-year closed at its lowest level since 5 April
• Traders push up odds of September Fed rate cut following CPI report (Bloomberg)
• Latest US inflation data could support stock market laggards (Reuters)
• Private credit funds have raised over US$13bn in US investment grade corporate bond market this year, pacing toward record (Bloomberg)

STOCKS

• Tesla extends gains after Musk says shareholders voting yes for his US$56bn pay package (Bloomberg)
• Apple not paying OpenAI as part of partnership, sees mutual benefits derived from distribution (Bloomberg)
• OpenAI has more than doubled annualized revenue in last six months (The Information)

CENTRAL BANKS

• Fed now projects one rate cut in 2024 from three previously (Bloomberg)
• Powell sends mixed interest rate signal (FT)
• ECB's Nagel says core inflation "still very sticky", stresses meeting-by-meeting approach to cuts (Bloomberg)
• BOJ to discuss tapering JGB purchases at Friday's meeting (Bloomberg)

GEOPOLITICS

• G7 members reach deal to provide US$50bn to Ukraine using profits from frozen Russian assets (FT)
• NATO says over 300,000 troops are now on 'high readiness' (Economic Times)
• Hezbollah says it attacked nine Israeli sites with rockets, reportedly largest attack on Israel since war began (Reuters)
• Biden administration extremely concerned about risk of all-out war between Israel and Hezbollah (Axios)
• US expands Russia sanctions to undercut its war machine, targeting chips sent via China (Reuters)
• China EV stocks shrug off EU tariff decision (Bloomberg);

ECONOMY

• US PPI unexpected fell in May to 2.2% vs. consensus 2.5%, core PPI unchanged month-on-month vs. expectations for a 0.3% rise (Reuters)
• Eurozone industrial production unexpectedly fell at the start of Q2, with intermediate goods driving decline (Bloomberg)
• Australian unemployment rate falls, markets pare RBA rate cut expectations (Bloomberg)
  
  

ASX TODAY

• ASX 200 set for a relatively flat start following a mixed overnight lead (where strength remains concentrated to a handful of megacap tech stocks)
• Commodity prices were relatively weak overnight after the US dollar bounced 0.5% to a near six week high
• Overnight resource-related ETFs (Rare earths, gold, silver, nickel, copper etc.) continued to roll over, pointing to a weak start for local names
• Chemist Warehouse deal can still get past ACCC health check (AFR)
• Deterra to buy UK-based Trident Royalties for $276m (DRR)
• Downer EDI seeking to sell its 30% stake in Linen Services (AFR)
• Winsome Resources seeking to raise $20m at 85 cents per share (AFR)

BROKER MOVES

• Champion Iron upgraded to Buy from Outperform; target up to $7.90 from $7.20 (CLSA)
• Corporate Travel upgraded to Buy from Hold; target down to $16 from $17.50 (Jefferies)
• Jumbo Interactive upgraded to Outperform from Neutral; target up to $17.45 from $17.15 (Macquarie)
• Lottery Corp upgraded to Outperform from Neutral; target up to $5.50 from $5.25 (Macquarie)
• Reece Australia initiated Sell with $23.35 target price (Goldman Sachs)
• Telix Pharmaceuticals upgraded to Buy from Hold; target remains $19 (Bell Potter)
  
  

KEY EVENTS

• Fri 14 June: None
• Mon 17 June: None
• Tue 18 June: Premier Investments (PMV) – $0.63
• Wed 19 June: Afp Pharmaceuticals (AFP) – $).01
• Thu 20 June: None

• Dividends paid: Technology One (TNE) – $0.05, Nufarm (NUF) – $0.04
• Listing: Resouro Strategic Metals – 10:30 am AEST

• 10:30 am: Australia Consumer Confidence (Jun)
• 1:00 pm: BOJ Interest Rate Decision
• 12:00 am: US Consumer Sentiment (Jun)

This Morning Wrap was written by Kerry Sun.