Outlook for the day: The share market has fresh heights within reach this morning following record closes on Wall Street and gains in iron ore and copper.
ASX futures: up 27 points or 0.31%
Overnight themes:
The S&P 500 and Nasdaq Composite closed at new highs as a key economic barometer reached its highest since February and investors continued to look past trade tariff worries.
The S&P 500 put on 0.27% as an upbeat forecast from Delta Air Lines helped lift market sentiment. The Nasdaq Composite edged up 0.09% to a second-straight record close. The Dow added 192 points or 0.43%.
The Dow Jones Transportation Index, used by many investors as a gauge of the health of the US economy, climbed 2.6% as claims for unemployment benefits fell to a seven-week low, and Delta's profit upgrade boosted airlines and other transport stocks. Delta's stock advanced 11.99%. United Airlines soared 14.33%. American Airlines tacked on 12.72%. Initial claims for jobless benefits fell to 227,000 last week, below the consensus of 235,000.
"Collectively [the jobless claims and Delta news] helped to re-insert the risk-on mode that was in full bloom yesterday and carried over to today," Mark Luschini, chief investment strategist at Janney Montgomery Scott, told Reuters.
Investors shrugged off the White House's latest tariff announcements. President Donald Trump confirmed his administration will impose a 50% tariff on copper imports from August 1. He also announced a 50% tariff on Brazil, citing an "unfair trade relationship" and the trial of former president Jair Bolsonaro. Brazil's President Luiz Inacio da Silva said Brazil would respond to the levy in accordance with its economic reciprocity law.
Nine of eleven S&P sectors advanced, led by consumer discretionary +0.98% and energy +0.79%. Financials gained 0.64%. Materials rose 0.46%. The two sectors to lose ground were tech -0.12% and communication services -0.48%.
BHP and Rio Tinto surged in overseas trade as iron ore hit a nine-month high and copper rose in London and US trade. Benchmark ore on China's Dalian Commodity Exchange rallied 3.67% to US$106.41 a metric ton after a jump in heavy machinery sales signalled the Chinese building industry may have turned a corner. Sales of excavators used in construction lifted 23% in the first half of the year, according to the China Construction Machinery Association. The equipment can be used by analysts as a proxy for steel demand, according to Bloomberg. US copper futures advanced 2.59% to US$5.6285 a pound. Benchmark copper on the London Metal Exchange bounced 0.53% to US$9,682 a metric ton. BHP's American Depositary Receipts put on 3.83% overnight after its UK listing popped 5.07%. Rio added 2.37% in the US and 4% in the UK.
Bitcoin broke new ground overnight, topping US$113,000 for the first time. The e-coin traded as high as US$113,784.60 before paring its rally to 2.56% at US$113,594 in recent action.
Oil retreated as traders priced in the potential hit to global growth from this week's wave of US tariff announcements. Brent crude settled US$1.55 or 2.21% lower at US$68.64 a barrel. President Donald Trump's administration this week despatched tariff letters to more than 20 countries, announced a 50% duty on copper and signalled plans to tariff pharmaceuticals and semiconductors.
Tariff worries helped keep a bid under precious metals. Spot gold was lately up US$10.10 or 0.3% to US$3,323.67 an ounce. Earlier, US gold futures settled with a gain of US$4.70 or 0.1% at US$3,325.70. Spot silver rallied 63 US cents or 1.73% to US$37.01 an ounce.
Key events today:
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S&P 500: up 17 points or 0.27%
Dow: up 192 points or 0.43%
Nasdaq: up 19 points or 0.09%
VIX: down 1% to 15.78
US 10-year treasury yield: up 1 point to 4.351%
Dollar: up 0.84% to 65.91 US cents
Iron ore (Dalian): up 3.67% to US$106.41
Brent crude: down US$1.55 or 2.21% to US$68.64
Gold (futures): up US$4.70 or 0.1% to US$3,325.70
Gold (spot): up US$10.10 or 0.3% to US$3,323.67
Silver (spot): up 63 US cents or 1.73% to US$37.01
Palladium (spot): up US$61.50 or 5.39% to US$1,202
Antimony (China ore): down 0.05% to US$19,790
NYSE Arca Gold Bugs: up 0.95%
Bitcoin: up 2.56% to US$113,594
Copper (LME): up 0.53% to US$9,682
Nickel (LME): up 1.9% to US$15,285
Lithium carbonate (China spot battery grade): up 0.5% to 7,824 yuan
Global X Lithium & Battery Tech ETF: up 2.16%
Uranium (spot): up 0.35% to US$71.75
Global X Uranium ETF(URA): up 0.82%
BHP: up 3.83% (US); up 5.07% (UK)
