AU Morning Wrap: ASX Falls, Domino's Drops, Accent to Close Glue Stores
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• AI and semiconductor stocks pulled back hard while slower-growing stocks on the Dow Jones led the index to a fresh closing and intraday high.
• Australian shares fell 0.2 per cent at the open as the tech sector tumbled 1.7 per cent to follow its overseas peers lower.
• Stocks to watch: Domino's Pizza, Accent Group, Telix Pharmaceuticals, Fortescue
Wall Street Summary
The market pulled back Wednesday, as AI and semiconductor stocks pulled back hard while slower-growing stocks on the Dow Jones led the index to a fresh closing and intraday high. After 4 pm EST, the $S&P 500 Index (.SPX.US)$ was down 1.39%, while the $Nasdaq Composite Index (.IXIC.US)$ slumped 2.7%. The $Dow Jones Industrial Average (.DJI.US)$ fared better, rising 0.59%. Overall 4400 equities advanced, while 7105 declined.
This week will be a light one for macroeconomic news, with many Federal Reserve speakers and Initial Jobless claims on Thursday.Federal Reserve Gov. Christopher Waller said the central bank is "getting closer to the time when a cut" in interest rates is warranted, but he still wants more evidence that inflation is slowing before he's ready to move.
I believe current data are consistent with achieving a soft landing, and I will be looking for data over the next couple months to buttress this view," Wall said in a speech in Kansas City. " So, while I don't believe we have reached our final destination, I do believe we are getting closer to the time when a cut in the policy rate is warranted."
Federal Reserve Governor Adriana D. Kugler said Tuesday she anticipates "it will be appropriate to begin easing monetary policy later this year" if economic conditions continue to evolve in a favorable manner with more rapid disinflation and employment softens while remaining resilient. She addressed the National Association for Business Economics Foundation in Washington.
If the labor market cools too much and unemployment continues to increase and is driven by layoffs, I would see it as appropriate to cut rates sooner rather than later," Kugler said. "Alternatively, if incoming data do not provide confidence that inflation is moving sustainably toward 2 percent, it may be appropriate to hold rates steady for a little longer."
Federal Reserve President Jerome Powell spoke Monday, saying the Fed would likely lower rates before inflation to 2%.
AU Market Watch
Australian shares opened down 0.2%, driven by a 1.7% drop in the tech sector, following declines in US and Asian semiconductor stocks due to profit-taking and concerns over deteriorating US-China economic relations. The Nasdaq fell 2.7%, its worst day since December 2022, while Japan's $Nikkei 225 (.N225.JP)$ dropped nearly 2% at the open. $Domino's Pizza Enterprises Ltd (DMP.AU)$ shares fell 9% locally, and $Guzman y Gomez Ltd (GYG.AU)$ dropped 1.9%. Iron ore prices slipped 2.2%, with $BHP Group Ltd (BHP.AU)$ and $Rio Tinto Ltd (RIO.AU)$ trading slightly lower. Australia's June jobs report, expected to show a jobless rate increase to 4.1% and the addition of 20,000 jobs, will be released at 11:30am AEST.
Commodity
Spot gold fell 0.6% to $2455.24 per ounce, Brent crude rose 1.4% to $84.89 per barrel, and iron ore dropped 2.2% to $105.05 per tonne.
Crypto
As of latest data, $Bitcoin (BTC.CC)$ is priced at $64,383, down by 1.45% in the past 24 hours, while $Ethereum (ETH.CC)$ is priced at $3,409, down by 1.5% in the past 24 hours.
Stocks to Watch
Domino's Pizza announced plans to close stores in France and Japan and lowered its future group store growth guidance.
$Accent Group Ltd (AX1.AU)$ will shut down 18 Glue stores due to poor performance from the youth fashion brand, causing its stock to jump 9.2% to $2.14 following the news and a profit update.
Biotech firm $Telix Pharmaceuticals Ltd (TLX.AU)$ raised its sales guidance for fiscal 2024, with shares increasing 0.2%, adding to a five-year gain of over 1000%.
In a restructuring move, iron ore miner $Fortescue Ltd (FMG.AU)$ will cut 700 jobs, mainly within its green hydrogen business.
Economic Calendar (AEST)
9:50 am:Japan Balance of Trade (Jun)
11:30 am: Australia Unemployment Rate (Jun)
4:00 pm:UK Unemployment Rate (May)
10:15 pm: ECB Interest Rate Decision
Source: Dow Jones Newswires, AFR
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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