The Overnight Report: Nasdaq’s New Record High

Array
(
    [0] => Array
        (
            [0] => ((BGL))
            [1] => ((S32))
            [2] => ((MIN))
            [3] => ((PLS))
            [4] => ((RMS))
            [5] => ((GGR))
            [6] => ((RRL))
            [7] => ((WGC))
            [8] => ((CSC))
            [9] => ((ASB))
            [10] => ((IEL))
            [11] => ((USL))
            [12] => ((SOL))
            [13] => ((KPG))
            [14] => ((ALX))
            [15] => ((BGL))
            [16] => ((GNE))
            [17] => ((IPG))
            [18] => ((SBM))
            [19] => ((TUA))
        )

    [1] => Array
        (
            [0] => BGL
            [1] => S32
            [2] => MIN
            [3] => PLS
            [4] => RMS
            [5] => GGR
            [6] => RRL
            [7] => WGC
            [8] => CSC
            [9] => ASB
            [10] => IEL
            [11] => USL
            [12] => SOL
            [13] => KPG
            [14] => ALX
            [15] => BGL
            [16] => GNE
            [17] => IPG
            [18] => SBM
            [19] => TUA
        )

)

This story features SOUTH32 LIMITED, and other companies.
For more info SHARE ANALYSIS: S32
The company is included in ASX50, ASX100, ASX200, ASX300 and ALL-ORDS

US markets traded mixed overnight, with the Dow Jones easing, while the Nasdaq Composite reached a second consecutive all-time high.

The AI trade is back, while Apple set a new all-time high with a US$4.95trn market cap!

The Australian market rallied yesterday, and ASX200 futures are pointing to another positive start.

Good Morning,

On Tuesday, the ASX200 rose 0.3% or 25.9 points yesterday to 8758.80, led by InfoTech up 2.67% and Healthcare up 0.76%.

Staples were the laggard.

Bellevue Gold ((BGL)) has released its FY26 result and Annual Report. Moelis’ early assessment:

“BGL’s FY26 result was benign. Although lease accounting (again) caught us out, the result generally reflected our expectations for the year just passed. In addition, the company reiterated previously stated guidance. 

“We make no significant changes to our production assumptions – barring to incorporate the commentary around “3-4koz” impact on September Q production as a result of the contractor changeover.

“The accounts did provide an updated tax loss quantum of ~A$400m, which translates through (in our estimates) to an additional 6 month reprieve before the company will likely commence cash payments to the ATO. This change noticeably bolsters near-term cashflow and provides the impetus for an increase in our price target to A$2.10/share (was A$1.90). “

For more details and to stay in touch with which companies are going ex-dividend, check out the FNArena Calendar https://fnarena.com/index.php/financial-news/calendar/

Today’s Big Picture, J.L. Bernstein extract

Trump Says an Iran Deal Comes After the Midterms

Japan’s Kyodo News reported that Iran would reopen the Strait of Hormuz within a week if the US eased military pressure.

Brent crude fell to US$97 on the news. Then Trump told the UN he expects a deal “right after the election,” and Brent climbed back to about US$100.

The midterms are six weeks away, and until then every Iran headline hits oil first, then bond yields, then stocks.

Meta’s Muse Is Learning to Shop

Shopify $SHOP will let Meta’s Muse AI agent buy from its stores using Shop Pay.

PayPal $PYPL signed a similar deal with Meta today. In its first 12 days, Muse was downloaded 1.8 million times, versus 1.3 million for ChatGPT, per Sensor Tower.

Amazon already blocked Muse from shopping its site, so the fight over who owns the checkout button has started.

Viking’s Weight-Loss Shot Works With Fewer Doses

Viking Therapeutics $VKTX had its best day since February 2024 on new data for its weight-loss shot.

Patients who cut back to one shot a month kept off most of the weight they’d lost, well ahead of placebo.

Citi’s Geoff Meacham called the fewer-shots result the bigger deal.

Lilly and Novo still own this market, and both stocks slipped today.

CBA Economics: Daily Alert, Trent Saunders extract

US sharemarkets were mixed overnight as technology shares extended their recent rally.

In Australia, RBA officials delivered broadly hawkish messages on Tuesday. Governor Bullock and Assistant Governor Hunter emphasised the need to prevent higher energy prices from feeding into inflation expectations and broader price-setting, with Bullock noting that the labour market remained somewhat tight.

Assistant Governor Sarah Hunter struck a similar tone in her appearance. Meanwhile, RBA Board member Iain Ross was more dovish, arguing that a 1970s-style wage-price spiral remained unlikely.

The CommBank Household Spending Insights (HSI) series rose by just 0.1% in August, slowing annual growth from 5.2% to 4.7%. While spending indicators have been choppy in recent months, CBA data suggests there has been a broad-based slowdown in spending when compared to rates of growth seen in late 2025 and through the first parts of 2026.

US sharemarkets were mixed on Tuesday, with the Nasdaq closing at all-time highs, driven by AI stocks, as oil prices dipped below US$US100 a barrel on hopes for a deal to end the war in Iran.

US President Donald Trump said that American officials had a productive, three-hour meeting with their Iranian counterparts and he believed there could be a deal completed after the mid-term elections in early November.

Six of the 11 S&P500 sector indexes rose, led by materials, up 1.9%, followed by a 1.2% gain in consumer staples. The Dow Jones index finished down -0.4%, the S&P500 index was flat and the Nasdaq index rose 0.5%.

European sharemarkets closed modestly higher as investors watched for developments in US-Iran tensions that could influence oil prices and risk appetite. The continent-wide FTSEurofirst 300 index ended up 0.1% and the UK FTSE100 index slipped -0.3%.

US government bond yields were relatively steady as investors weighed lower oil prices against expectations for further interest rate hikes from the Federal Reserve. The US 10-year Treasury yield rose 1 point to 4.96% while the US 2-year Treasury yield was flat near 4.75%.

Currencies were marginally lower against the US dollar. Aussie dollar was flat at US71.15 cents.

Global oil prices fell on the diplomatic efforts to end the Iran war and increasing flows of Saudi crude with the restart of the East-West pipeline and ship movements through the Strait of Hormuz. Brent crude futures settled -1.1% lower at $US99.25 a barrel.

Base metal prices were higher on Tuesday. Copper futures rose for a sixth straight session, up 1.1%, as top metals consumer China stocked up ahead of holidays. Meanwhile, aluminium futures gained 1.4%.

In a note, CBA economists said that increases in Chinese and European aluminium output won’t be enough to pull the global market out of deficit this year. 

Gold futures edged lower as markets factored in more restrictive US monetary policy this year, while traders also kept close tabs on the Middle East conflict.

The futures settled down -0.2% at US$4,376 an ounce. Iron ore futures inched -0.2% lower to settle at US$97.32 a tonne.

Commodity price update, 3Q26, RBC Capital Markets, James Redfern extract

The RBC Global Metals & Mining Team has revised commodity price forecasts for 2H2026-2030. Reflecting our new price forecasts, EBITDA estimates for our Australian Metals & Mining coverage decline by an average of -4% in FY27 forecasts, mainly reflecting our -2% lower iron ore prices, -5% lower gold prices and -10% lower aluminium prices.

Relative to consensus, for 2027, RBC forecasts sit -7% below for iron ore, 3% above for copper, 4% higher for gold and 23% ahead for spodumene.

We have also taken the opportunity to standardise WACCs for our coverage, which is the driver behind our lowered price targets.

 While our ratings remain unchanged, we reiterate our key Outperform ratings: South32 ((S32)) ($5.50/sh PT), Mineral Resources ((MIN)) ($80.0/sh PT), PLS Ltd ((PLS)) ($5.10/sh PT), Ramelius Resources ((RMS))($4.40/sh PT), Greatland Resources ((GGR)) ($13.50/sh PT), Regis Resources ((RRL)) ($8.00/sh PT) and Westgold ((WGC)) ($6.00/sh PT).

Global: Is an AI downturn unavoidable? Oxford Economics

• The AI boom continues to grow and is now among the largest of the tech-related booms over the past two centuries. Most other examples ended abruptly, often painfully, even where the technology delivered strong economic benefits. That risk looks significant for AI, too.
• AI-related capex accounted for an estimated 27% of US fixed investment in Q2, and cumulative investment in the sector has topped 2% of US GDP in the past three years. Among historical tech booms, only the UK railway mania of the 1840s showed a larger surge in investment.
• The surge in investment reflects hopes for very large returns from this new technology, but the evidence for these is limited so far, with utilisation-adjusted measures of US productivity growth decelerating. Notably, the dotcom boom of a quarter of a century ago produced productivity benefits quite quickly, so AI will also need to result in strong tangible benefits soon, especially with AI firms now showing negative free cash flow.
• Current consensus estimates of profit growth in the sector look inconsistent with our estimates of the likely productivity gains from AI – they’d imply AI firms appropriating most or all of the additional GDP yielded by the tech and those firms accounting for implausibly high shares of total corporate profits. AI firms’ share price valuations are hard to justify unless productivity returns prove far higher.
• Importantly, for there to be a sharp correction in the AI sector, it doesn’t require the technology to prove worthless, only for there to be disappointment relative to the currently elevated expectations. There are a number of possible triggers for a correction, including concerns over profitability, incoming negative news on productivity gains and demand, regulatory risks, and rising US interest rates. These risks are likely to intensify as we enter 2027.

Macro Views: Growth Holds, Pressure Builds, Sonal Desai, Franklin Templeton, extract

The US economy remains resilient, but the key issue is whether narrow, capital-intensive growth can coexist with persistent inflation pressure. 

Three months after concerns that higher energy prices and supply-chain disruption could push the economy into a stagflationary drift, the macro backdrop is better described as an inflationary expansion supported by private demand, a stable labor market, corporate profitability and artificial intelligence (AI) investment.

Yet growth remains concentrated in AI-linked sectors, while the consumer continues to slow rather than break. Inflation is still too broad for comfort, with supply/input-cost pressure, tariffs, energy and AI bottlenecks complicating disinflation.

A still-stable labor market allows the Federal Reserve (Fed) to keep its focus firmly on inflation, while rates remain sensitive to incoming data, policy credibility, deficits and Treasury financing needs.

Euro-area growth keeps surprising to the upside despite rising energy prices and uncertainty, with second-quarter (Q2) gross domestic product (GDP) well above expectations and the ex-Ireland aggregate growing a solid, trend-like 0.3% quarter-over-quarter (q/q).

Momentum is still good, though the third quarter (Q3) started on a weaker foot, with Purchasing Managers’ Indexes (PMIs) pointing to an industrial pickup while real-income pressure and weak retail sales keep the consumer pulse in focus.

Headline inflation will likely rise further, driven largely by fuel prices, but there are still no signs of second-round effects, and a full broadening of the inflation shock is not our base case.

Politics and fiscal policy will return to the spotlight as budget season and elections approach, especially in France, Italy and Spain. Meanwhile, European Central Bank (ECB) tightening risks remain energy-dependent, though current euro (EUR) front-end steepness looks hard to justify.

Japan remains in a long-term recovery phase, with Q2 2026 GDP below expectations but better than the preliminary reading. Public consumption drove growth, while private consumption stalled and intellectual property dragged on capital expenditure (capex).

Q3 indicators still point to robust activity, though the Kumamoto earthquake, rising oil imports and fading durable-goods boosts may act as constraints. Inflationary momentum remains sticky despite energy subsidies, as petroleum-related costs are gradually passed on to consumers, core goods prices rise and services show resilience.

Policy expectations have shifted sharply, with markets bracing for further hikes through 2027, post the Bank of Japan (BoJ) delivering a 25-basis-point hike in September.

Japanese Government Bond (JGB) yields have touched multi-decade highs, driven by inflation, fiscal concerns and faster BoJ normalisation, with global spillover and repatriation risks keeping pressure on yields.

Corporate news in Australia:

• Capstone Copper ((CSC)) agrees to sell its Cozamin copper mine in Mexico to Luca Mining for up to US$385m
• Andrew Forrest is assessing competing $1.9bn bids for Austal ((ASB)), with his 19.3% stake potentially influential in the takeover outcome
• IDP Education ((IEL)) rejects Blackstone’s unsolicited $696m takeover proposal
• Country Road Group is reportedly attracting buyer interest despite pushing back on speculation the retail group is for sale
• Unico Silver ((USL)) launches a $60m equity raising to replenish its balance sheet
• Canadian copper explorer Gladiator Metals is set to dual-list on the NSX at a market capitalisation of almost $250m, potentially the exchange’s largest float in around a decade
• Washington H. Soul Pattinson ((SOL)) is shifting further away from listed equities towards real assets, credit and private companies as it reshapes its $13.8bn investment portfolio
• ASIC issues interim stop orders on three Remara Cash Management Fund private credit products
• Firmus’ proposed IPO structure gives the former owners of Benmax significant exposure to the planned listing following its acquisition of the air-conditioning business
• Kelly+Partners ((KPG)) plans to shift its listing from the ASX to Nasdaq, subject to resolving CEO Brett Kelly’s $6.3m company loan
• Bathla’s reliance on private credit after losing access to banks has left lenders with more than $3bn of exposure following its collapse

On the calendar today:

-AU Sep PMI prelim

-JP Public Holiday

-EZ Sep PMI prelim

-UK Sep PMI prelim

-US Sep PMI prelim

-ATLAS ARTERIA ((ALX)) ex-div 20.00c

-BELLEVUE GOLD LIMITED ((BGL)) FY26 earnings report

-GENESIS ENERGY LIMITED ((GNE)) ex-div 6.29c

-IPD GROUP LIMITED ((IPG)) ex-div 7.90c (100%)

-ST. BARBARA LIMITED ((SBM)) ex-div 5.00c (100%)

-TUAS LIMITED ((TUA)) FY26 earnings report

FNArena’s four-weekly calendar: https://fnarena.com/index.php/financial-news/calendar/

The Australian share market over the past thirty days…

For more detail go to FNArena’s Australian Broker Call Report, which is updated each morning, Mon-Fri.

All overnight and intraday prices, average prices, currency conversions and charts for stock indices, currencies, commodities, bonds, VIX and more available on the FNArena website.  Click here. (Subscribers can access prices on the website.)

(Readers should note that all commentary, observations, names and calculations are provided for informative and educational purposes only. Investors should always consult with their licensed investment advisor first, before making any decisions. All views expressed are the author’s and not by association FNArena’s – see disclaimer on the website)

All paying members at FNArena are being reminded they can set an email alert specifically for The Overnight Report. Go to Portfolio and Alerts on the website and tick the box in front of The Overnight Report. You will receive an email alert every time a new Overnight Report has been published on the website.

Find out why FNArena subscribers like the service so much: “Your Feedback (Thank You)” – Warning this story contains unashamedly positive feedback on the service provided. www.fnarena.com

FNArena is proud about its track record and past achievements: Ten Years On

Click to view our Glossary of Financial Terms