ASX Live Coverage Summary – June 24

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Wall Street’s Resilience Amid Geopolitical Tensions

9:00 AM
According to Deutsche Bank, geopolitical disturbances have historically caused a decline of 6% in the S&P 500 over a span of three weeks; however, the index tends to recover completely within the subsequent three weeks. Morgan Stanley echoed this sentiment, noting that while geopolitical events generally induce significant short-term volatility in equities, the long-term outlook remains optimistic. Historical data indicates that over the next one, three, and twelve months, the S&P 500 averages increases of 2%, 3%, and 9%, respectively.

ASX’s Response to Geopolitical Events

8:55 AM
Historical analysis shows that the S&P/ASX 200 often remains unaffected by major geopolitical incidents. On average, the index demonstrates positive performance post-conflict across all timelines. For a detailed analysis, refer to our comprehensive report on the topic.

Source: Author’s Research | Performance reflects S&P/ASX 200 price movement

Factors Influencing Stock Market Trends

8:50 AM
The S&P 500 concluded the previous trading day up by 0.96%, rebounding from an early dip of 0.41%. Several factors contributed to this positive momentum:

• The impact of recent US military actions in the Middle East, targeting Iranian nuclear facilities, did not lead to significant geopolitical fallout.
• Iran’s response, which focused on US bases, was perceived as less aggressive than anticipated.
• Brent crude oil prices plummeted by 8.8% to US$70.33 per barrel, the lowest since mid-June. Traders seemed to have overestimated the risks of supply chain disruptions, leading to a retraction of the previously inflated risk premium.
• Fed Governor Michelle Bowman hinted that a rate cut could be imminent next month if inflation remains stable or declines, following similar indications from Fed official Christopher Waller regarding a potential reduction in July.

Morning Snapshot

8:40 AM
The S&P/ASX 200 futures increased by 62 points (+0.73%) as Wall Street overcame initial setbacks to close positively at optimal levels.

New readers can quickly familiarise themselves by reviewing today’s Morning Wrap for critical updates and insights.

Stay tuned for more updates throughout the trading day!