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Monday Morning Wrap – 21 July 2025
Market Snapshot:
The ASX 200 futures indicate a downturn of 49 points (-0.56%) as of 8:30 am AEST.
Key Points:
- Major US indices concluded the session with minimal movement, exhibiting a slight dip overall.
- While several companies, including Netflix, American Express, and 3M, reported better-than-expected earnings, this uplift did not translate into significant share price gains.
- Notably, Block is set to be included in the S&P 500, while Donald Trump has initiated a lawsuit against News Corp.
Overnight Market Summary: (as of 8:24 am AEST)
| Major Indices: | Index | Value | % Change |
|---|---|---|---|
| S&P 500 | 6,297 | -0.01% | |
| Dow Jones | 44,342 | -0.32% | |
| NASDAQ Comp | 20,896 | +0.05% | |
| Russell 2000 | 2,240 | -0.61% |
| Country Indices: | Country | Value | % Change |
|---|---|---|---|
| Canada | 27,314 | -0.27% | |
| China | 3,534 | +0.50% | |
| Germany | 24,290 | -0.33% | |
| Hong Kong | 24,826 | +1.33% | |
| India | 81,758 | -0.61% | |
| Japan | 39,819 | -0.21% | |
| United Kingdom | 8,992 | +0.22% |
| Commodity Prices (in USD): | Commodity | Value | % Change |
|---|---|---|---|
| Gold | 3,349.44 | -0.08% | |
| Copper | 5.5408 | -0.18% | |
| WTI Oil | 67.34 | +0.17% |
Currency:
- AUD/USD: 0.651 (+0.05%)
| Cryptocurrency: | Cryptocurrency | Value | % Change |
|---|---|---|---|
| Bitcoin (USD) | 117,723 | +0.09% | |
| Ethereum (AUD) | 5,751 | +5.02% |
Market Dynamics:
- In a fairly stagnant session in the US market, several sectors had mixed results, with utilities and consumer discretionary showing positive performance.
- On the other hand, sectors like energy and health care declined.
Key Market Influences:
- Trump’s heightened trade demands in conversations with the EU, advocating minimum tariffs, alongside ongoing responses from the Federal Reserve regarding interest rates, has continued to influence market perceptions.
- Reports indicate significant inflows into high-dividend stocks as investors speculate on interest rate cuts resulting from recent strong retail sales data.
- Trends among major tech stocks, particularly from the "Magnificent Seven," have displayed diverging fortunes as the impact of AI faces increasing scrutiny.
Recent Corporate Highlights:
- Netflix surpassed earnings expectations, although analysts warn that shares need to cool off following considerable recent rises.
- Nvidia faces supply challenges with its AI chips for Chinese clients.
- Amazon is reducing its workforce in its AWS division amidst rising AI expenditures.
- Burberry reported a minor sales decline, showing stronger-than-expected growth in the Americas.
Global Central Bank Insights:
- Federal Reserve Governor Waller has suggested a potential 25 basis point cut in July, while the European Central Bank remains hesitant to alter rates amidst evolving U.S. trade behaviours.
Geopolitical and Economic Developments:
- China’s exports of rare earth magnets to the US have surged significantly as relationships evolve.
- The US trade policy continues to induce strategic conversations in both China and the EU.
ASX Focus for Today:
- Block shares are anticipated to jump following its S&P 500 inclusion announcement.
- Euroz Hartleys announced shareholder approval for a significant capital return.
- The performance of the lithium sector remains crucial as Pilbara Minerals sees noteworthy gains.
Broker Updates:
- BHP has been downgraded to Neutral from Outperform, target revised to $41.
- Eagers Automotive is now rated Sell from Neutral but has seen its target increased.
- James Hardie downgraded to Neutral with a target adjustment.
Look Ahead:
Stay tuned to our Live Blog for the latest insights on ASX announcements, market trends, and economic updates. While no major economic releases are scheduled, anticipate market reactions based on ongoing corporate earnings and global developments, particularly in technology and commodities.
