ASX 200 afternoon report: 23 May 2024

The ASX 200 trades 38 points (-0.48%) lower at 7810 at 3.00pm AEST.

Following a turbulent start to trading, where the ASX 200 plummeted 84 points (-1.07%), it managed to recoup half its initial losses after US equity futures rallied on the back of Nvidia's strong earnings report.

The market's initial decline followed a 3.6% fall in index heavyweight BHP's share price after Anglo American rejected its latest offer and a hawkish set of FOMC meeting minutes, which revealed that "various" participants would be willing to hike rates further if necessary.

While the minutes preceded the release of cooler CPI and labour market data in recent weeks, they were sufficient to push yields higher and reduce the probability of a Fed rate cut in September to just slightly better than a coin toss.

Nvidia's earnings propel market confidence

As we've seen multiple times this year, if there is one remedy for bond market anxiety, it is the AI juggernaut led by Nvidia. Nvidia's latest earnings report sent its share price surging above $1,000 in after-hours trading to a high of $1,016.80.

Its EPS of $6.12 beat market expectations of $5.58, as did its revenues of $26 billion versus $24.59 billion expected. CEO Jensen Huang added momentum to this high-octane phenomenon by noting, "We will see a lot of Blackwell revenue this year" and "I can announce that after Blackwell, there is a second chip. We are on a one-year rhythm."

Nvidia's market capitalisation now stands at $2.5 trillion, on par with the combined market capitalisation of the Italian and Australian stock markets!

ASX 200 stocks

IT sector

• Xero: + 9.5% to $135.78
• Tyro Payments: + 3.57% to $0.87c
• NextDc: + 2.85% to $18.06
• Seek: + 1.58% to $23.20

Banking sector

The big banks have fallen after a large American broker slapped a sell rating on NAB and Westpac.

• NAB: - 1.44% to $34.29
• ANZ: -1.26% to $28.26
• Westpac: - 1.26% to $26.73
• CBA: - 0.89% to $120.43

Mining sector

• Rio Tinto: - 2.14% to $133.26
• Mineral Resources: - 2.04% to $76.81
• Fortescue: - 0.95% to $47.05

Gold sector

After a good run, gold stocks have fallen after the price of bullion eased back towards $2375 following the hawkish FOMC meeting minutes, which boosted US yields and the US dollar.

• Regis Resources: - 7.08% to $1.97
• Evolution Mining: - 4.02% to $3.82
• Northern Star: - 3.10% to $14.23
• Silver Lake Resources: - 2.95% to $1.56

Uranium sector

• Paladin: - 4.96% to $16.30
• Deep Yellow: - 4.58% to $1.71
• Silex Systems: - 4.25% to $6.31
• Boss Energy: - 3.68% to $5.50

ASX 200 technical analysis

Last week's rally above the May 7814 high saw us move to a neutral bias. A sustained close above weekly trend channel resistance, currently at 7960ish, is needed to move to a bullish bias. Aware that weakness below support at 7720/00 would warn that the ASX 200 has carved out a double top at 7900/10 and a deeper pullback is underway.

ASX 200 daily chart

ASX 200 technical analysis

ASX 200 daily chart

• ^{Source: TradingView: the figures stated are as of 23 May, 2024. Past performance is not a reliable indicator of future performance. This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation.}