S&P 500 closed slightly higher as investors await several big macro events

 

The S&P 500 rose slightly overnight, fighting to hold onto last week’s gains as bond yields inched higher and investors braced for a busy week of economic news.

Two big macro events for this week are Fed Chair Powell's monetary policy testimony before the Senate Banking Committee on Tuesday and the House committee on Wednesday. In addition, the February employment report on Friday.

Overnight the S&P 500 gained 0.1 per cent, while the Dow Jones Industrial Average rose 40 points, giving back a gain of more than 181 points at session highs. The Nasdaq Composite closed down 0.1 per cent.

Despite these moves, some tech stocks pushed higher. Apple led the sector’s gains, jumping about 2 per cent after Goldman Sachs initiated coverage with a buy rating. The iPhone maker accounts for about 7 per cent of the S&P. Alphabet and Microsoft also gained about 1 per cent each.

In company news Credit Suisse has lost a longtime backer. Shares in the Swiss bank fell after the investment firm Harris Associates sold off its remaining stake, ending a decades-long investment in the beleaguered lender. “There is a question about the future of the franchise,” David Herro, Harris’s chief investment officer was quoted as saying

Tesla has cut prices in the U.S. again. The electric vehicle maker announced a 4 per cent discount for its Model S and a 9 per cent cut for its more expensive Model X. The move, apparently driven by flagging demand, follows price cuts announced in January that appeared to revive sales.

In commodity news, an expected jump in iron ore prices because of lower levels of supply from Australia and Brazil, and increased demand in Chinese steel manufacturing, has led Goldman Sachs to underscore its bullish view on Rio Tinto shares. The investment bank has upgraded its iron ore price forecast by 20 per cent to US$120 a tonne from US$100 a tonne in 2023. The broker has also issued a three-month target of US$150 a tonne compared to the spot price of US$125 a tonne with the expectation that there will be a 43 million tonne deficit of iron ore in the market.

In lithium news, South American nations are stepping up efforts to propel themselves further down the electric-vehicle supply chain by leveraging their vast mineral wealth, expanding processing capacity, and targeting vehicle manufacturing. Argentina, Chile, Bolivia and Brazil plan to coordinate action on turning more of the region’s mined lithium into battery chemicals, as well as moving into manufacturing of batteries and EVs. The so-called lithium triangle of Argentina, Chile and Bolivia account for more than half of global lithium resources, and both Brazil and Argentina have auto-making experience.

Overnight, the S&P 500 sectors were mixed. Technology and Communication Services were the best performers, whilst Materials was the biggest laggard.

Futures

The SPI futures are pointing to a 0.2 per cent fall.

Currency

One Australian dollar at 8:10 AM has weakened compared to the US dollar yesterday buying 67.28 US cents (Mon: 67.46 US cents).

Commodities

Iron ore futures are pointing to a 0.6 per cent gain. Iron ore is 1.6 per cent lower at US$125.35 tonne.

Gold fell 0.1 per cent. Silver lost 0.6 per cent. Copper added 0.2 per cent and oil was up 1.1 per cent.

Figures around the globe

Across the Atlantic, European markets closed mixed. London’s FTSE fell 0.22 per cent, Frankfurt gained 0.5 per cent while Paris closed 0.3 per cent higher.

In Asian markets, Tokyo’s Nikkei gained 1.1 per cent, Hong Kong’s Hang Seng added 0.2 per cent while China’s Shanghai Composite closed 0.2 per cent lower.

Yesterday, the Australian sharemarket closed 0.6 per cent higher at 7328.60.

Ex-dividends

Excelsior Capital (ASX:ECL) is paying 3 cents fully franked
Heartland Group (ASX:HGH) is paying 5.0352 cents unfranked
Laserbond (ASX:LBL) is paying 0.8 cents fully franked
Lovisa Holdings (ASX:LOV) is paying 38 cents fully franked
Meridian Energy (ASX:MEZ) is paying 5.3238 cents unfranked
Mayfield Childcare (ASX:MFD) is paying 4.38 cents fully franked
Northern Star (ASX:NST) is paying 11 cents fully franked
Perseus Mining (ASX:PRU) is paying 1.06 cents unfranked
PSC Insurance (ASX:PSI) is paying 5.2 cents 60 per cent franked
Qube Holdings (ASX:QUB) is paying 3.75 cents fully franked
Shine Justice (ASX:SHJ) is paying 1.5 cents unfranked
Sonic Healthcare (ASX:SHL) is paying 42 cents fully franked
TPC Consolidated (ASX:TPC) is paying 10 cents fully franked
Universal Store (ASX:UNI) is paying 14 cents fully franked
Viva Energy Group (ASX:VEA) is paying 13.3 cents fully franked

Dividends payable

GWA Group (ASX:GWA)
Vicinity Centres (ASX:VCX)

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.

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