ASX Set to Surge as Wall St Rallies and Bitcoin Hits $112K Milestone
Australian Shares Set to Rise Amid Strong US Market Performance
Positive Market Trends in the US
Australian stocks are expected to open higher, driven by significant gains in the US markets, where Nvidia achieved a historic milestone by surpassing a $4 trillion valuation. The tech giant’s shares increased by 1.8%, closing at $162.88, which brought its market capitalization to approximately $3.97 trillion after reaching a session high of $164.42.
bitcoin Breaks New Ground
In a remarkable development, bitcoin has surged past $112,000, marking a new all-time high. This surge is part of a broader rally in risk assets, particularly benefiting technology stocks. Rachael Lucas, a crypto analyst at BTC Markets, noted that geopolitical uncertainties and former President Trump’s renewed calls for aggressive interest rate cuts have heightened interest in risk assets, especially those with limited supply and global liquidity.
Lucas emphasized that bitcoin‘s appeal lies in its scarcity and growing acceptance as a strategic investment. Unlike previous market cycles characterized by speculative behavior, the current rally is marked by disciplined capital flows, inflows into exchange-traded funds (ETFs), and increased adoption by balance sheets, indicating a maturing market and stronger investor confidence.
Market Reactions to Trade Policies
Investors seem less concerned about the recent “trade” letters from Donald Trump on his social media platform, as the proposed tariff rates align closely with earlier announcements. Trump has indicated a 30% tariff on imports from Algeria, Libya, Iraq, and Sri Lanka, while imposing 25% duties on goods from Brunei and Moldova, and a 20% rate on products from the Philippines.
Mark Hackett from Nationwide pointed out that CNN’s Fear and Greed Index has shifted back into the “extreme greed” territory. He remarked that the market appears more receptive to risk, suggesting that the muted response to tariff news indicates that upcoming earnings reports will be the next significant market catalyst.
Upcoming Earnings Reports
Major US financial institutions are set to release their quarterly earnings reports late next week, which could further influence market dynamics. Meanwhile, copper futures on the Comex fell by 2.4%, trading at $5.549 per pound during late New York trading.
Market Overview
ASX futures indicate a rise of 41 points, or 0.5%, to 8571. Here’s a snapshot of key market indicators as of 5 PM New York time (7 AM AEST):
- AUD: Increased by 0.1% to $0.6535
- bitcoin: Up by 2.2% to $111,112
- US Markets: Dow Jones +0.5%, S&P 500 +0.6%, Nasdaq +0.9%
- VIX: Decreased by 0.87 to 15.94
- Gold: Rose by 0.4% to $3,313.66 per ounce
- Brent Oil: Slightly down by 0.04% to $70.12 per barrel
- Iron Ore: Increased by 0.1% to $95.85 per tonne
- 10-Year Yields: US at 4.33%, Australia at 4.34%
What to Watch for on Thursday
Thursday is expected to be relatively quiet in terms of economic data, with the primary focus on the weekly US initial jobless claims report, which will provide further insights into the labor market’s strength.
Noteworthy Headlines
- Super Funds and Equity Mandates: Fund managers may face challenges if superannuation funds reconsider their equity mandates, particularly regarding major bank shares, as reported by Joyce Moullakis.
- CFMEU Queensland Investigation: A report has revealed disturbing allegations of violent behavior by the CFMEU’s Queensland branch towards rival union members, public officials, and even children.
- Australia’s Diplomatic Balancing Act: Prime Minister Anthony Albanese is navigating a complex relationship between a volatile Trump and a punitive China.
- Lifestyle’s Fee Structure Under Scrutiny: A former ASX darling in affordable housing is facing criticism over its long-standing fee structure.
- Copper Tariffs and Economic Impact: Jennifer Hewett argues that the Trump administration’s push for domestic copper production may inadvertently lead to higher costs for manufacturers.
