The Overnight Report: Waiting For Nvidia

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Good morning.

Funny opening of the day by economists at National Australia Bank this morning:

“There seems to be more interest in news of the Oasis reunion and world tour’ so far not extending beyond the shores of Ireland (perhaps for fear they might have broken up again by then) than there has been in financial markets in the last 24 hours.

“Understandable though, in front of Nvidia’ earnings report after Wednesday’s NYSE close and with just ten more sleeps until the August US payrolls report that should determine the size of the Fed’s Sep 18 rate cut. Plus, the northern hemisphere summer holiday season has not yet come to an end.”

SPI futures are indicating the local market is poised for a weak start, which would have been the case yesterday too if not for a strong share price performance by BHP Group ((BHP)) following the release of FY24 financials.

The main piece of economic news overnight has been the US Conference Board’s August consumer confidence survey. This rose by more than expected, even off the upward revised July reading.

In other US economic news the Richmond Fed’s August manufacturing Index fell to -19 from -17 (-14 expected) and its Business Conditions readings to -13 from -19. Meanwhile the Dallas Fed’s Services Activity index fell to -7.7 from -0.1.

The one eye-catcher overnight was the Energy sector which reversed the rally that preceded on renewed geopolitical tensions.

Both the S&P500 and NASDAQ closed pretty much unchanged, while the smaller cap Russell 2000 is down -0.6%. Earlier both the Eurostoxx 600 and UK FTSE100 ended 0.2% higher.

In bonds, Treasury curve steepening is evident via a -4ps fall in 2-year yields by 1bps lift in 10s. Money market futures price -33bps for the Sep 18 FOMC outcome, out from -32bps on Monday.

Later today, Nvidia will report its quarterly results after the NYSE close (so early Australian time Thursday morning).

Given Nvidia’s current 6.3% weight in the S&P500, its potential impact on the broader markets is obvious.

On the calendar today:

-Australia July CPI

-US MBA Mortgage Applications

-APA Group ((APA)) earnings report

-AV Jennings ((AVJ)) earnings report

-Bell Financial ((BFG)) ex-div 4c (100%)

-COG Financial Services ((COG)) earnings report

DGL Group ((DGL)) earnings report

-Flight Centre ((FLT)) earnings report

-Fortescue ((FMG)) earnings report

-Karoon Energy ((KAR)) earnings report

-Kelsian Group ((KLS)) earnings report

-Mineral Resources ((MIN)) earnings report

-Nine Entertainment ((NEC)) earnings report

-NextDC ((NXT)) earnings report

-Woolworths Group ((WOW)) earnings report

FNArena’s Corporate Results Monitor: https://fnarena.com/index.php/reporting_season/

Corporate news in Australia:

-Austin Engineering ((ANG)) is looking for acquisitions to expand its capabilities and scale, assessing opportunities based on their potential benefits

-Acquisition-hungry Yancoal Australia ((YAL)) may target the $3bn Kestrel coal mine if it misses out on the $4bn Anglo American assets

-CommBank’s ((CBA)) chief economist, Stephen Halmarick, will depart in 2025 after 15 years

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.

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