ASX Follows Wall Street | Bitcoin Hits $75k

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Welcome to Equity Espresso’s Market Recap.

The Australian share market climbed on Wednesday, with the S&P/ASX 200 Index rising 0.8% to 8,199.5 points, driven by positive sentiment from Wall Street and early U.S. election results showing Donald Trump in the lead. The rally was further supported by Nasdaq's 1.4% gain overnight, notably featuring Nvidia's (+2.84%) surge, which saw it surpass Apple as the world's most valuable company at $US3.43 trillion.

The Technology (+1.89%) sector followed U.S. tech gains, with Technology One (+3.29%), Life360 (+2.18%) and Xero (+2.00%) some of the day’s best performers. Consumer Discretionary (+1.54%) stocks also saw gains, led by JB HI-FI's (+2.71%) gain and Wesfarmers' (+1.56%).

Materials (-0.01%) stocks started the day positively before ending the day flat after Iron Ore prices increased 2% to $US105.95 per tonne. Despite the early momentum, BHP Group (-0.49%), Rio Tinto (-0.14%) and Fortescue (-0.63%) ended the day lower.

The Financial (+1.61%) sector also performed strongly, with all major banks trading higher - Commonwealth Bank up 1.12%, and similar gains for NAB, ANZ, and Westpac.

Bitcoin surged to a new all-time high above $US75,000, rising more than 8% amid the ongoing U.S. presidential election between Donald Trump and Kamala Harris. The cryptocurrency's gains accelerated as Trump took early leads in key swing states Georgia and North Carolina, surpassing previous records during the spot-ETF launch excitement in March.

Company News

• Cooper Energy (+6.06%) has increased its FY25 production guidance to 65-72 TJe/day from the previous 62-69 TJe/day, driven by better-than-expected performance at the Orbost Gas Processing Plant. Production expenses and capital expenditure guidance remain unchanged.

• Domain Holdings (-5.59%) shares fell after providing a trading update at its AGM. The company reported Q1 FY25 total revenue growth of 8%, driven by 15% growth in depth revenue and 9% in digital revenue. October listings growth accelerated, supporting 19% year-on-year depth revenue growth. The company maintained its FY25 cost guidance of high single to low double-digit increases, with stable EBITDA margins.

• Goodman Group (-0.22%) forecasts a 9% growth in operating earnings per share for FY25 with a 30¢ distribution, supported by strong portfolio fundamentals, including 97.4% occupancy and 4.9% like-for-like Net Property Income growth. Despite weaker conditions in China, the company reported robust industrial space demand, with 2.7 million sqm leased, generating $404 million in annual rental income.

• Neuren Pharmaceuticals (+8.15%) will receive one-third of the net proceeds after its partner Acadia Pharmaceuticals agreed to sell an FDA-granted Priority Review Voucher for US$150 million, following DAYBUE's approval for Rett syndrome treatment, with minimal expected costs.%

Wall Street

U.S. markets surged on Tuesday, with the S&P 500 (+1.23%), Nasdaq (+1.43%), and Dow Jones (+1.04%) all making significant gains. The broad rally was led by the Industrial (+1.67%) and Consumer Discretionary (+1.83%) sectors, reflecting positive economic data, though the VIX "Fear Gauge" remained slightly elevated above its long-term average.

Investors are navigating multiple significant events this week, including ongoing presidential election voting and the upcoming Federal Reserve policy announcement on Thursday. While markets have largely priced in a 25-basis point rate cut, the robust U.S. economy has created uncertainty around the future trajectory of rate reductions.

Palantir's (+23.38%) stock surged following impressive Q3 earnings, with revenue growing 30% year-over-year to $726 million. The company attributed success to strong A.I. demand, particularly from U.S. government clients, and raised Q4 revenue guidance above analyst expectations. Trump Media & Technology (+10.43%) shares rose in after-hours trading, with the stock seen as an indicator of Donald Trump's presidential campaign prospects.

S&P500 Sector Performance

Economic Data

• Australia’s Ai Group Industry Index dropped sharply in October 2024, down by 10.1 points to -28.8 (seasonally adjusted), marking thirty consecutive months of contraction.

• U.S. ISM Services PMI unexpectedly jumped to 56.0 in October 2024, the highest since August 2022, from 54.9 in September, beating forecasts of 53.8.

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🌎️ Around The Globe

• Affirm, the U.S. buy now, pay later company, launched its first international expansion in the U.K. on Monday, offering interest-free and fixed-interest payment plans.

• Apple is reportedly secretly testing smart glasses with internal employee groups while developing a more affordable Vision Pro and second-generation model. The smart glasses project remains years away from consumer release, with the company prioritising Vision Pro iterations.

• Boeing machinists voted 59% in favour of accepting the company's third contract offer, ending their strike with a 43% pay raise over four years and a $12,000 bonus. Though workers didn't secure their desired pension plan, the strike cost workers $600 million, Boeing $6.5 billion, and the US economy $11.5 billion.

• Coca-Cola announced the return of Barrilitos, a Mexican soda that was originally launched in 1938, reimagining the beverage as a carbonated version of its recent agua fresca variant. The relaunch aims to preserve its Latino heritage while appealing to new generations.

• Meta's plans for a nuclear-powered A.I. data centre with Tennessee Valley Authority were halted after a rare bee species was discovered at the site. Despite this environmental setback, CEO Mark Zuckerberg indicated the company remains open to future nuclear and low-carbon energy partnerships.

• New York Times Tech Guild's 600 workers initiated a strike during Election Day, impacting digital services and prompting calls for readers to avoid NYT's games and Cooking app. The strike stems from stalled contract talks, though NYT assured continuous election coverage.

• Physical Intelligence, a San Francisco robot startup, secured $400 million in funding at a $2.4 billion valuation, marking a sixfold increase since March. Backed by Jeff Bezos, OpenAI, and other major investors, the company employs former Tesla and DeepMind talent.

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*1-year, 3-year and 5-year returns are calculated as of September 30 2024.

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DISCLAIMER: Please note that the information provided in this newsletter is for educational purposes only and should not be considered financial advice. It is not intended to encourage you to buy/sell assets or make economic decisions. We strongly recommend conducting your research before making any investment.