ASX 200 afternoon report: 9 January 2024
ASX 200 trades higher after four days' loss
The ASX 200 trades 80 points (1.08%) higher at 7532 at 2.15 pm AEDT. Today, the ASX 200 snapped a four-day losing streak following a rebound on Wall Street overnight.
The rally on Wall Street was led by chip maker NVIDIA, which added 6.43% to $522.53 after announcing new AI-based products for personal PCs. Fellow chip makers AMD and Intel were caught in the updraft, adding 5.48% and 3.33%, respectively.
While the ASX 200 IT sector contains no chip makers of any note, it holds several BNPL stocks that responded well to today's stronger-than-expected Australian retail sales data for November (2.2% MoM vs 1.2% expected).
Zip added 5.24% to $0.55c. Block added 3.71% to $103.19. Elsewhere, Appen added 5.1% to $0.52c, Megaport added 3.76% to $8.83, and Xero added 2.81% to $108.63.
Tomorrow sees the release of the Australian monthly consumer price index (CPI) indicator for November. The consensus expectation is for the monthly CPI indicator to fall to 4.5% year-on-year from 4.9%. Should the trimmed mean (core) fall below 5%, it would confirm the rates market is on the right track, looking for two Reserve Bank of Australia (RBA) rate cuts in 2024.
Softer inflation number could boost banks' gains
The prospect of a softer inflation number tomorrow and RBA rate cuts allowed the big banks today to build on their December gains. Macquarie added 1.24% to $180.59, NAB added 1.21% to $30.88, CBA gained 0.80% to $112.87, while Westpac and ANZ each added around 0.75%.
The iron ore behemoths continued to be supported by a buoyant iron ore price trading near $138 per tonne. Fortescue gained 1.08% to $28.05, Mineral Resources added 0.95% to $67.71, BHP gained 0.62% to $48.96, and Rio Tinto added 0.15% to $131.70.
During the last quarter of 2023, we maintained a bullish stance on the ASX 200, looking for a test of the February 7567 high. While the February high was marginally exceeded, we note a potential double high/top in place at 7633, which bookends a double low, 6410 area from mid-2022.
With the ASX 200 showing signs of initial rejection last week from the top of its three-year 1,200-point range, we would be wary of opening longs unless a deeper pullback or a sustained break of 7633 is viewed
ASX 200 daily chart
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