Morning traders. Thanks loungers, especially @Ravgnome. And great to see @Patterns back!
Outlook for the day: Mildly negative as reversals in iron ore and crude weigh against record closes on Wall Street and strength in copper, gold and silver.
ASX futures: down 11 points or 0.14%
Friday themes:
The Nasdaq and S&P 500 closed at new highs after an uptick in unemployment bolstered the case for interest rate cuts.
The S&P 500 rose 0.54% to its 34th record finish this year.
The Nasdaq gained 0.9% as falling treasury yields encouraged traders to buy megacap tech stocks. Apple, Meta and Microsoft logged record closes. Tesla gained 2.08%, rising for an eighth straight session.
The Dow put on 0.17% as declines in energy and financial giants partly offset gains in Apple, Microsoft and Walmart.
Stocks rallied and the US dollar and treasury yields retreated as Friday's May jobs data lifted the odds on a September rate cut to 77% from nearer 64% a week earlier.
The jobless rate unexpectedly ticked up to a two-and-a-half-year high of 4.1% from 4% in May as downward revisions to previous months outweighed solid gains last month. Non-farm payrolls increased by 206,000 in June, but previous figures for April and May were lowered by 111,000. Together, the figures pointed to a slowdown in jobs growth.
Wage growth (a factor in inflationary pressures) also slowed. Annual growth was the weakest in three years.
"This report puts the Fed in a comfortable spot. If this continues next month, with no increases in hourly wages, then I think we'll see a rate cut in September and another one in December" - Peter Cardillo, chief market economist at Spartan Capital Securities (per Reuters).
Bank stocks fell ahead of quarterly reports later this week as a new earnings season gets underway. JPMorgan, Bank of America and Wells Fargo all lost more than 1%. The S&P financial sector shed 0.28%.
Other pockets of weakness included energy -1.52% and industrials -0.4%. The day's best were communication services +2.74%, consumer staples +1.21% and consumer discretionary +0.85%.
Friday's rally sealed solid weekly gains for the main benchmarks. The S&P 500 put on 1.95%. The Nasdaq added 3.5%. The Dow advanced 0.66%. Small caps under-performed: the Russell 2000 lost 0.95%.
BHP and Rio Tinto pulled back in overseas trade after a second straight weekly decline in hot metal output by steelmakers helped knock iron ore down 2% in China. Mysteel data showed daily hot metal output contracted 0.1% last week following the recent rally in ore prices. Benchmark ore in China gained 3.2% for the week, despite Friday's setback.
Gold and silver logged their highest closes since May as the greenback wilted under Friday's mixed jobs data. Gold advanced US$28.30 or 1.2% to US$2,397.70 an ounce for a weekly gain of around 2.5%. Silver put on 85 US cents or 2.8% at US$31.69 to wrap up a weekly gain of 7.2%, its best week since May.
"With likely future Fed rate cuts and dollar weakness, gold prices are likely to rise on trend. Further slowing of U.S. inflation, increased geopolitical and political risks, and dollar weakness are poised to send gold prices higher" - Jason Schenker, president of Prestige Economics (per MarketWatch).
Copper climbed to a three-week high, briefly retesting US$10,000 a metric ton. Benchmark prices in London finished 0.62% ahead at US$9,944.
Key events this week:
Consumer sentiment - Tuesday
Business confidence - Tuesday
Congressional appearances from Federal Reserve Chair Powell and Treasury Secretary Yellen - Tuesday
China inflation - Wednesday
US consumer inflation (CPI) - Thursday
US wholesale inflation (PPI) - Friday
US consumer sentiment - Friday
Start of a new quarterly US earnings season - Friday
S&P 500: up 30 points or 0.54%
Dow: up 68 points or 0.17%
Nasdaq: up 164 points or 0.9%
Dollar: down 0.13% to 67.39 US cents
Iron ore (Dalian): down 2% to US$116.30
Brent crude: down 89 US cents or 1.02% to US$86.54
Natural gas (US futures): down 1.67% to US$2.33
Gold: up US$28.30 or 1.2% to US$2,397.70
Silver: up 85 US cents or 2.8% to US$31.69
NYSE Arca Gold Bugs: up 2.63%
Bitcoin: down 2.65% to US$56,408
Copper (LME): up 0.62% to US$9,944
Nickel (LME): up 0.72% to US$17,341
Uranium (spot price): steady at US$86.50
Lithium carbonate (China spot): down 0.14% to US$12,433
