ASX 200 to open higher, Cyclicals and value shine, S&P 500 lower as Nvidia slides

ASX 200 futures are trading 36 points higher, up 0.46% as of 8:30 am AEST.

S&P 500 SESSION CHART

OVERNIGHT MARKETS

• Major US benchmarks finished mixed but breadth was solid, with the Dow, Russell 2000 and Equal-weight S&P 500 closing higher
• Equal-weight S&P 500 outperformed the benchmark by 39 bps – This gets back to concentration dynamics surrounding big tech
• Market rally beginning to broaden towards cyclical and value pockets of the market
• Semis and risk-assets under pressure, with Nvidia (-6.7%) and Bitcoin (-5.2%) – likely reflecting overbought conditions and stretched positioning
• US investors growing more anxious on Wall Street's rich valuations (Bloomberg)
• Japan's top currency diplomat says authorities ready to intervene in yen if necessary – the yen against the US dollar hit a 34-year low on Monday (Bloomberg)
• Nvidia enters correction territory as it marks worst three day run since December 2022, down 12.9% (Bloomberg)
• Bitcoin extends recent slide, falling below US$60,000 for first time since early May (Bloomberg)

STOCKS

• Nvidia's sales growth is so rapid that analysts are unable to keep up (Bloomberg)
• EU regulators accuse Apple of breaching digital competition rules for App Store (Reuters)
• Ford reportedly suspends release of new battery electric vehicles amid profitability concerns (ArgusMedia)
• Shein reportedly has confidentially filed for a public listing in London (CNBC)
• KKR mulls new North America private equity fund, seeks US$20bn from investors (Reuters)

CENTRAL BANKS

• Fed's Daly warns of labour market risks, nearing inflection point (Bloomberg)
• BoC's Macklem says they can beat inflation without unemployment spike (Bloomberg)
• BOJ debated need for timely rate hike, signalling July move, also plan to reduce JGB purchases (Reuters)
• ECB's Schnabel warns of potential inflation shocks, emphasises flexible approach to interest rates (Bloomberg)

GEOPOLITICS

• Israeli PM Netanyahu signals intense stage of Gaza fighting is close to end and open to partial deal with Hamas (Bloomberg)
• China agrees to talks with EU on EV tariffs (NY Times)
• Japan PM Kishida losing public support despite plans for more stimulus (Kyodo)

ECONOMY

• German IFO misses with economy showing signs of a weak recovery after bottoming out earlier this year (Bloomberg)
  
  

ASX TODAY

• ASX 200 set to open higher as market rally begins to rotate into value and cyclicals
• Strong lead in for Energy stocks – Best performing sector on the S&P 500, Brent crude settled 0.1% higher (up from session lows of -0.9%)
• James Hardie (ADRs +5.2%) issues North America aspirational financial targets at Investor Day, targeting double-digit revenue growth over the long-term (JHX)
• Paladin Energy to acquire Fission Uranium in all-stock deal – post completion, existing Paladin and Fission shareholders will own ~76% and ~24% of the enlarged Paladin respectively (PDN)
• Qantas to acquire 14 additional mid-life Dash 8-400 aircraft, investment will be within FY25 net capex guidance of $3.7-3.9bn (QAN)
• Red 5 CEO Luke Tonkin discloses sale of 5.4m shares (RED)
• ResMed sinks as drug trial sparks Ozempic-style sell-off (AFR)
• Seven West Media cuts close to 10% of workforce (The Aus)

BROKER MOVES

• Capitol Health downgraded to Hold from Buy; target up to $0.32 from $0.29 (Bell Potter)
• City Chic downgraded to Hold from Buy; target cut to $0.20 from $0.62 (Bell Potter)
• Monadelphous Group upgraded to Buy from Hold; target remains $14.45 (Argonaut)
• ResMed downgraded to Neutral from Buy; target cut to $30 (Citi) 
  
  

KEY EVENTS

• Tue 25 June: None
• Wed 26 June: Fisher & Paykel (FPH) – $0.218
• Thu 27 June – REITs: HealthCo Healthcare and Wellness REIT (HCW) – $0.002, Centuria Industrial REIT (CIP) – $0.04, Centuria Office REIT (COF) – $0.03, Homeco Daily Needs REIT (HDN) – $0.021, Arena REIT (ARF) – $0.043, Charter Hall Long Wale REIT (CLW) – $0.065, Garda Property Group (GDF) – $0.016, Hotel Property Investments (HPI) – $0.095, Charter Hall (CHC) – $0.23, Charter Hall Social Infrastructure REIT (CQE) – $0.04, Waypoint REIT (WPR) – $0.041, GDI Property Group (GDI) – $0.025, National Storage (NSR) – $0.055, Goodman Group (GMG) – $0.15, Stockland (SGP) – $0.166, Growthpoint Properties (GOZ) – $0.097, Dexus Convenience Retail REIT (DXC) – $0.053, Dexus Industria REIT (DXI) – $0.041, Dexus (DXS) – $0.213
• Thu 27 June – Everything else: Rural Funds Group (RFF) – $0.029, Virgin Money (VUK) – $0.039, Mirvac Group (MGR) – $0.06, Region Group (RGN) – $0.07
• Fri 28 June: Abacus Group (ABG) – $0.043, Ophir High Conviction Fund (OPH) – $0.06, Danakali (DNK) – $0.009, Abacus Storage King (ASK) – $0.03

• Dividends paid: Infratil (IFT) – $0.109, Westpac (WBC) – $0.75
• Listing: None
• Earnings: Collins Food (CKF)
• AGMs: Macquarie Group (MQG)

• 10:30 am: Australia Consumer Confidence (Jun)
• 10:30 pm: Canada Inflation Rate (May)

This Morning Wrap was written by Kerry Sun.