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ASX Live Coverage: Market Updates, Alcoa’s Setback, and CPI Report Preview
Welcome to our live coverage of the ASX for July 15. We are pleased to present this format which includes a high volume of updates ahead of the market opening and periodic news throughout the day. Please refresh the page manually for the latest information, and feel free to share your thoughts to improve our coverage.
US Market Dynamics
[08:52 AM] Recent trading on Wall Street reflects a mix of sentiment and positioning:
- JPMorgan has observed that hedge fund net positioning has dropped by 4% week-on-week, currently at the 64th percentile for the last year. This suggests some investors are cautious about the recent rally, despite a medium-term optimistic outlook.
- Goldman Sachs reports that dealers are becoming increasingly short on gamma, which could lead to heightened near-term volatility and positioning changes.
- There’s potential additional buying power from CTAs, with an expected $31 billion in purchasing this week and up to $132 billion in the coming month, indicating significant systematic flows could bolster market performance in the short term.
- Jefferies highlights a 5% decrease in the US Market Neutral Momentum Index month-to-date, a trend that has historically indicated a possible 12.5% gain over the subsequent year, suggesting a potential broadening of market leadership.
- The AAII bull-bear spread has recorded two consecutive positive readings for the first time since January, though it showed a slight decrease last week, indicating a reasonably elevated sentiment without reaching euphoric levels.
Overall, while market positioning remains relatively subdued, the technical and flow-driven elements suggest potential for short-term gains.
Alcoa Faces Challenges
[08:49 AM] Alcoa has announced delays in the restart of its San Ciprián smelter, now projected for mid-2026 due to a major power outage that occurred on April 28. The outage significantly affected operations at both the refinery and the smelter.
Key points regarding the situation include:
- The restart is currently on hold pending clarification from the Spanish Government about the outage’s cause and future preventive measures.
- Alcoa foresees a pre-tax net loss ranging from $90 to $110 million, equivalent to $0.35 to $0.42 per share, along with cash outflows between $110 and $130 million, as revenue is delayed until 2026.
- The outlook has worsened compared to previous guidance, with timelines for production and restart being extended, increasing financial pressure from the inactive asset.
As a result, Alcoa stocks dropped by 4.1% following the announcement.
Anticipated US June CPI Report
[08:38 AM] The upcoming US CPI report for June is set to be a critical factor influencing the markets and the Federal Reserve’s near-term interest rate strategy. The data will be released tonight at 10:30 PM AEST.
Key forecasts include:
- Core CPI is expected to climb from 0.1% month-on-month in May to 0.3% in June, bringing the annualised core inflation rate to 3.0%, the highest level since February.
- Headline inflation is also anticipated to rise to 0.3% month-on-month in June, increasing the annual rate to 2.7%.
- Analysts predict that the bulk of inflationary pressures will be centred on core goods, influenced by ongoing tariff effects.
- Currently, the market is factoring in a 7% likelihood of a rate cut in July and around 60% for September.
Morning Overview
[08:30 AM] The S&P/ASX 200 futures are trading up 51 points (+0.59%) following a broadly positive performance from major US indexes, with the S&P 500 (+0.14%) nearing all-time highs.
If you’re just joining us, be sure to catch up with today’s Morning Wrap for a comprehensive overview.
This summarised update encapsulates key market movements and projections, offering insights into economic influences impacting the ASX and global markets today.
