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ASX Poised for Uptick as Global Markets Surge; Wall Street Remains Shut

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Virgin Money UK started and finished the day at the bottom of the index with a 6.1 per cent loss, while TechnologyOne lost 4.9 per cent and Weebit Nano sank 3.3 per cent.

The lowdown

Origin Energy rose to the top of the bourse after investors digested Thursday’s news that it would delay a crucial shareholder vote on Brookfield and EIG’s proposed $20 billion takeover of the company after getting a revised eleventh-hour alternative proposal.

Meanwhile, Bubs Australia’s share price shed 18.2 per cent after te company launched a $14 million capital raising at 12.5¢ per share to accelerate its growth plans in the US. The goat milk infant formula company was in a trading halt ahead of the news.

Bubs’ new chief executive Reg Weine, who took the mantle after founder Kristy Carr was ousted, said he was delighted to complete the capital raising.

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“On the back of the strong customer demand in [the] USA, these funds are expected to accelerate our growth in the region,” he said in a statement. “We thank our existing shareholders who participated and welcome the new shareholders to Bubs.”

Reflecting more broadly on global markets this week, AMP senior economist Diana Mousina said sharemarkets rallied as mixed economic data indicated “no urgency” to raise interest rates from most central banks.

“The Reserve Bank of Australia may be an exception here,” she wrote.

“It’s conceivable that US shares reach their all-time highs again before the end of the year. Australian shares have underperformed relative to the US for the majority of 2023, and more risk of further RBA rate hikes compared to the Fed means this underperformance is likely to continue for now.”

But she urged caution for investors because inflation remained higher than ideal levels and the Israel-Hamas war could still escalate, leading to a high risk of recession in 2024.

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“Shares could still have another leg down over coming months, and some caution is needed,” she wrote.

Overnight, European investors digested minutes of the European Central Bank’s (ECB) October meeting, at which policymakers were encouraged by cooling inflation in the region. The pan-European STOXX 600 added 0.3 per cent, extending gains to notch a fresh two-month high. Trading volumes were weaker with US markets closed for the Thanksgiving holiday.

Eurozone inflation is falling as expected, or even a bit faster, but the European Central Bank must keep the possibility of an interest rate rise on the table, policymakers agreed last month, according to the accounts of their October 25-26 meeting.

“The minutes underline the ECB’s more cautious take on the economy and, in fact, mark the next phase of monetary policy tightening: ending rate hikes and focusing on ‘high for longer’,” said Carsten Brzeski, global head of macro at ING Economics in a note.

Tweet of the day

Quote of the day

“The Four Corners program was scrutinising the way powerful groups – including WA police – were responding to climate activists. WA police had a clear conflict of interest in demanding the footage, and the ABC should have recognised that.”

(The following story may or may not have been edited by NEUSCORP.COM and was generated automatically from a Syndicated Feed. NEUSCORP.COM also bears no responsibility or liability for the content.)

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