Good Evening,

Welcome to Equity Espresso’s Daily Recap. 

The ASX 200 index finished the day lower, driven down by Mining companies, which offset the positive news that consumer inflation is slowing down more than expected. The leading Australian index closed the day 52 pts. or 0.7% lower to 7,468, making it five red days out of the six in 2024.

Seven of the 11 sectors ended the day lower, with Materials dropping by 2.10% as the Iron Ore price fell again today, with futures markets having the commodity trading at three-week lows of US$134.75. BHP Group (-2.3%), Fortescue Group (-1.8%) and Rio Tinto (-2.3%) all closed lower. Lithium companies also felt the brunt of the sell-off, as the Lithium commodity price trades at 17-month lows, with Pilbara Minerals (-4.4%) and IGO (-8.1%) some of the more prominent players to see sell-offs.

Uranium companies were a bright spot on the market on the back of the news that the U.S. Department of Energy said it was looking to establish a domestic supply of enriched uranium fuel to offset its reliance on Russian supplies. Paladin Energy (+10.9%) and Boss Energy (+6.9%) were some companies that saw their share price spike on the back of the news.

Alumina shares rose 17.4% to $1.15 after it revealed plans yesterday to halt alumina production at its Kwinana plant. Small-cap Neometals rose 22.9% after it received a $30 million order from Mercedes-Benz. Worley re-commenced trading on the market today, falling by 2.3% after it denied allegations of “illegality or bad faith” made by an Ecuadorean tribunal, which were reported in the media.

Wall Street

The S&P 500 (-0.15%) and the Dow Jones (-0.42%) both closed lower on Tuesday; however, the NASDAQ (+0.09%) had a modest rise as a marginal increase in treasury yields put pressure on markets. According to data from CME’s Fed Watch Tool, the likelihood of the Federal Reserve cutting rates by March has been slowly decreasing, down to a 65.7% chance of a 25 basis point cut, down from 79% a week ago.

The Energy (-1.63%) sector saw the largest falls, while Technology (+0.25%) was the best performer of the four sectors to finish in the green, which helped the NASDAQ close higher.

Jefferies Financial Group was the first bank to kick off the start of quarterly earnings reports, where it recorded a fall in earnings of 53% to US$66 million, driven by a fall in declining advisory fees.

Economic Data

• Australian CPI rose by 4.3% in November, down from 4.9% in October and slightly below forecasts of a 4.4% increase, marking the lowest point since January 2022.

• The Average Cash earnings in Japan increased by 0.2% year-on-year in November, making it the 23rd consecutive month of rising wages.

• South Korea’s Unemployment Rate jumped to 3.3% during December - an increase from 2.8% in November, marking it the highest rate since January 2022.

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Quick Singles

🪃 Local News

• Australians lodged a record number of complaints with the Australian Financial Complaints Authority (AFCA) during 2023. The number of complaints surpassed 100,000, with almost 9000 related to scams, representing a 95% increase from the previous year. The CEO of AFCA has expressed concern that the rate of complaints is rising at an unsustainable rate.

🌎️ Around The Globe

• LG debuted a fully transparent 77-inch high-definition television during the Consumer Electronics Show 2024.

• Newell Brands said on Monday that it would cut its workforce by about 7% by the end of 2024 as part of an organisation realignment. Some of the companies’ brands include Sharpie, Graco and Yankee.

• Johnson & Johnson will buy drug developer Ambrx for $2 billion in a bid to gain access to drugs that belong to a class of targeted cancer therapies.

• Apple will begin shipping its new Vision Pro headsets in the U.S. on February 2, with pre-orders set to start on January 19.

• Volkswagen plans to integrate a ChatGPT-powered chatbot into its vehicles with an IDA voice assistant. This will enable drivers to engage in hands-free conversations and access information. The AI-based chatbot will also be able to read out researched content.

• Waymo, a self-driving car company, plans to test its autonomous taxis on highways in Phoenix, Arizona, this month. The company has recently added curbside drop-off and pick-up at the Phoenix airport. Waymo's autonomous Jaguar I-Pace SUVs will start shuttling employees around the city's freeways in a few weeks.

• Hewlett Packard is in talks to buy Juniper Networks in a deal valuing the network gear maker at around $13 billion.

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A Little Extra

📉 Going Down?

Top-10 shorted stocks on the ASX - as of January 4

👨‍💼 Director Transactions

What are the insiders doing? (On-market trade only)

DISCLAIMER: None of the information provided in this newsletter should be constituted as financial advice. This newsletter is strictly for educational purposes only. It should not be taken as investment advice or a solicitation to buy or sell assets or make financial decisions. Please do your research.