Daily Market Reports | 8:42 AM
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The company is included in ASX50, ASX100, ASX200, ASX300 and ALL-ORDS
Nasdaq led US markets lower, the first retreat after seven straight positive sessions.
Gold marched through US$4,000 as investors continued to buy the precious metal.
After a second weak day on the Australian market, ASX200 futures are indicating a flat start for the Wednesday session.
World Overnight | |||
SPI Overnight | 8986.00 | – 1.00 | – 0.01% |
S&P ASX 200 | 8956.80 | – 24.60 | – 0.27% |
S&P500 | 6714.59 | – 25.69 | – 0.38% |
Nasdaq Comp | 22788.36 | – 153.30 | – 0.67% |
DJIA | 46602.98 | – 91.99 | – 0.20% |
S&P500 VIX | 17.24 | + 0.87 | 5.31% |
US 10-year yield | 4.13 | – 0.04 | – 0.84% |
USD Index | 98.35 | + 0.58 | 0.59% |
FTSE100 | 9483.58 | + 4.44 | 0.05% |
DAX30 | 24385.78 | + 7.49 | 0.03% |
Good Morning,
The ASX200 fell -24.6pts or -0.27% to 8956.8 as profit taking was broad based with ten sectors down and only materials managed to rise.
Technology fell -0.5%.
What happened overnight, NAB Markets Today Research
The S&P500 fell -0.4%, breaking a run of 7 straight gains and the Nasdaq was -0.7% lower.
Tech giants dragged down the index after reports that Oracle profit margin in its cloud computing business may be lower than many estimates. Oracle was down around -5% at one point, though losses were pared to -2.3%.
The consumer discretionary sector led losses, down -1.4%, weighed by automakers. Tesla was down more than -4% after making its top-selling vehicle more affordable. Ford was -6% lower on reports an upstate New York fire that will sideline a supplier’s aluminum plant.
As the US government shutdown continues, an Office of Management and Budget memo reportedly says furloughed employees aren’t guaranteed paychecks for missed work and President Trump said ‘most’ furloughed workers will be taken care of and that permanent cuts may be unveiled in “four to five days.”
Trump also suggested Tuesday he was open to negotiating with Democrats over health care subsidies to bring an end to the funding stalemate but later said “first they must allow our Government to re-open”.
The NY Fed’s survey of expectations showed year ahead inflation expectations rising two tenths to a five-month high of 3.4%. That’s the third consecutive rise, retracing much of the earlier pullback from post-liberation day highs.
Longer term 5 year ahead expectations rose by 4bps to be back at the top of its range of the past few years. Carlyle published private data pointing to 17k employment growth in September, one more alternate indicator suggesting weak payroll growth continued in September.
From FOMC speakers, Minneapolis’s Kashkari, a non-voter this year, said it was too soon to tell whether high inflation will persist and that “some of the data that we’re looking at is sending some stagflationary signals.”
On the other side, Miran spoke again and said “my forecast for inflation is more sanguine than some of my colleagues,” and that “I view the mandate as less in tension than some others do.”
The FOMC Minutes tonight could add some further colour to the divergence of views on the FOMC.
The yen extended its decline, down another -1.0% with USDJPY rising to 151.85, following the surprise selection of Takaichi as the new LDP leader on Saturday. USDJPY is up 3% from Friday’s close and is at its highest since 19 February.
While the currency move extended, rates markets steadied. BoJ pricing for an October hike was steady at around 5bp over the past 24 hours, after paring sharply from 15bp at the end of last week.
30yr yields were steady at 3.30%, paring a selloff intraday after the bid-to-cover ratio on a 30yr bond auction rose from the last auction and came in slightly higher than the 12-month average. 30yr yields remain 13bp higher than Friday’s close.
German factory orders fell for a fourth consecutive month, down -0.8% m/m in August, against market expectations for a 1.2% lift.
The breakdown showed much weaker orders from abroad, with foreign orders down -4.1% and orders from within the euro area down -2.9%, while domestic orders surged 4.7%, the latter reflecting increasing orders in the defence sector.
With the resignation of Sébastien Lecornu as French prime minister leaving 2026 budget plans in turmoil, the euro was also weaker, down -0.5% to 1.1654. Lecorno is in last-ditch talks with the parties to find a path forward by Wednesday evening.
Beyond that, President Macron’s narrowing options include dissolving the National Assembly again and holding snap parliamentary elections or finding another potential premier. The AUD was -0.6% lower, back below 66c at 0.6580.
Gold prices rose to a fresh record high, with the most active future, currently the December contract, breaking above US$4000 for the first time, peaking at US$4014 before retreating. Spot gold sits at US$3981 and is up more than 50% YTD.
That outpaces gains in 2007-09 recession and the pandemic. Gold hasn’t risen this much in a year since the inflationary shock of 1979.
The rapid rise in gold prices has been supported by rising inflows into ETFs and central bank buying, including solid demand from China, as gold benefits from political, economic, and inflation uncertainty.
In NZ, the QSBO was a mixed report with both positives and negatives to take out of the survey, but conveying a weaker economic backdrop compared to the A&NZ business outlook survey, as it doesn’t capture the outperforming primary sector.
While the survey didn’t clear the fog on the size of any likely RBNZ rate cut today, it encouraged the domestic rates market to push short-end rates slightly lower.
Gold Market Update, World Gold Council extract
New highs…but is there more uplift?
Record monthly ETF inflows took gold to its 39th new high for the year, finishing the month of September at US$3,825/oz (up 12%). Y-t-d gold is up 47%, marking the highest return in a calendar year since 1979.
Our Gold Return Attribution Model (GRAM) suggests political tension, strong options market activity, and currency weakness played a key role in gold’s performance last month.
The only drag came from some rebalancing and profit-taking – captured in a gold price lag in the model and reflected in the intraday price dip on 30 September, which was quickly bought.
Gold ETF flows recorded their strongest month on record. Net inflows of US$17.3bn (146t) were dominated by North America (US$10.6bn) and Europe (US$4.4bn); Asia joined the rally (US$2.1bn) and other regions reported modest inflows. COMEX managed money net longs participated in gold’s upward price action, adding US$9bn (+33t).
Gold is a great long-run diversifier and a good short-run hedge against equity drawdowns. But because gold is not a contractual hedge, the good performance during equity corrections isn’t guaranteed.
What does gold have left in the tank? There is perhaps a concern that gold –-and in the short run this means gold investors-– might not respond so readily to an equity lurch, primarily because it looks overbought.
And there is probably some merit to this. From a tactical perspective gold might struggle to find marginal investment buyers in this scenario, even as long- run strategic positioning remains light.
An additional concern perhaps is that other factors might conspire against gold’s performance: oversold rates or dollar, over-egged fears, and so on.
We looked at a set of these drivers during historical equity drawdowns, addressing questions such as: how does gold fare unconditionally? What if gold has already performed really well (vs 200dma), is showing extended positioning, or if the dollar is cheap or oversold at the start of the equity sell off? Do credit spreads need to blow out for gold to do well?
What we found was that initial conditions are not great arbiters of gold’s performance during these sell offs. The only factor that really seems to matter is where the US dollar goes, and to a lesser extent where it sits in valuation terms prior to the sell off.
So, where is the dollar? Well, the bad news is that it looks almost as tactically oversold as gold is overbought; it has been dragging anchor for some time, which is unsurprising given the consistent dollar/gold long-run negative correlation.
The good news is that during two-thirds of the equity sell offs the dollar has fallen and has not been materially influenced by its own initial conditions. To boot, the dollar has been oversold for quite some time and there is no guarantee that a bounce will materialise just because equities drop.
In summary
Looking outside these factors, central banks have shown a propensity to buy dips over the last three years. And so, it seems, have other investors.
A mini-intraday gold selloff on 30 September quickly reversed into the close. So even at these levels, there appear to be investors waiting in the wings. And there are plenty of reasons for investors to be looking at gold.
Among these are:
-US government frictions, including the shutdown in early October
-Trade tensions not abating
-Flailing employment as inflation fears linger
-Dollar-hedging applying continuous pressure on one of gold’s key drivers.
While our analysis is only indicative, it leaves us somewhat confident that gold will hold its ground and perhaps see further uplift should equities experience a correction, given the plethora of supportive factors elsewhere.
Perhaps only a major liquidity squeeze could upend both gold and equities, but there are no clear signs of fractures in credit or banking sectors…yet!
Corporate news in Australia
-ASIC gives the go ahead to Cboe to list IPOs, as the ASX Ltd ((ASX)) monopoly is pared.
-Aware Super and Telstra Super to merge into a $253bn fund by FY26.
-Barrenjoey is selling Primavera’s Vitaco for up to $500m with a slow M&A market.
-Amcor ((AMC)) is planning a partial sell down of its $1bn US drinks packaging unit.
-Solly Lew is thought to be the buyer of up to 3% of Myer ((MYR)) shares on Monday.
-Tolu Minerals ((TOK)) is looking to raise $60.5m at $1.20 or a discount of -26.4% to the last close.
-Proxy adviser CGI Glass Lewis has recommended James Hardie Industries ((JHX)) shareholders vote to remove chairwoman Anne Lloyd at the AGM along with four other directors.
On the calendar today:
-NZ RBNZ OCR Decision
-JP Aug BoP
-JP Aug Earnings
-JP Aug Trade Bal
-CH Public Holiday
-US Sept FOMC mins
-CLIME CAPITAL LIMITED ((CAM)) ex-div 1.35c (50%)
-LUNNON METALS LIMITED ((LM8)) Investor Briefing
-MFF CAPITAL INVESTMENTS LIMITED ((MFF)) ex-div 9c (100%)
-NAOS EMERGING OPPORTUNITIES CO. LIMITED ((NCC)) ex-div 2.00c (100%)
-REDOX LIMITED ((RDX)) AGM
-TRANSURBAN GROUP LIMITED ((TCL)) AGM
-VULCAN STEEL LIMITED ((VSL)) ex-div 3.19c (85%)
FNArena’s four-weekly calendar: https://fnarena.com/index.php/financial-news/calendar/
Spot Metals,Minerals & Energy Futures | |||
Gold (oz) | 4004.57 | + 20.02 | 0.50% |
Silver (oz) | 47.55 | – 0.91 | – 1.88% |
Copper (lb) | 5.09 | + 0.04 | 0.79% |
Aluminium (lb) | 1.25 | + 0.01 | 0.88% |
Nickel (lb) | 6.89 | – 0.02 | – 0.30% |
Zinc (lb) | 1.38 | + 0.02 | 1.25% |
West Texas Crude | 62.03 | + 0.28 | 0.45% |
Brent Crude | 65.75 | + 0.20 | 0.31% |
Iron Ore (t) | 104.22 | – 0.26 | – 0.25% |
The Australian share market over the past thirty days…
Index | 07 Oct 2025 | Week To Date | Month To Date (Oct) | Quarter To Date (Oct-Dec) | Year To Date (2025) |
---|---|---|---|---|---|
S&P ASX 200 (ex-div) | 8956.80 | -0.34% | 1.22% | 1.22% | 9.78% |
BROKER RECOMMENDATION CHANGES PAST THREE TRADING DAYS | |||
AMP | AMP | Upgrade to Buy from Accumulate | Ord Minnett |
APE | Eagers Automotive | Upgrade to Accumulate from Hold | Ord Minnett |
ASX | ASX | Upgrade to Accumulate from Hold | Ord Minnett |
ILU | Iluka Resources | Downgrade to Sell from Hold | Ord Minnett |
MEI | Meteoric Resources | Upgrade to Speculative Buy from Speculative Hold | Bell Potter |
NHC | New Hope | Downgrade to Accumulate from Buy | Morgans |
NHF | nib Holdings | Upgrade to Buy from Accumulate | Ord Minnett |
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)
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CHARTS
For more info SHARE ANALYSIS: AMC - AMCOR PLC
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For more info SHARE ANALYSIS: LM8 - LUNNON METALS LIMITED
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