Market Highlights: Iron ore, oil and gold stocks on watch today after prices slump on weak China data

ASX to open flat despite tech stocks surging in New York
Magnificent Seven stocks led, while Arm surged 4pc
ASX companies need to communicate better with retail investors to make them stay – expert

Aussie shares are poised to open flat on Wednesday despite US stocks continuing their hot streak.

Overnight, the S&P 500 fell by -0.69%, the blue chips Dow Jones index was up by +0.17%, and the tech-heavy Nasdaq climbed by +0.90%.

Nasdaq notched its eighth straight day of gains, as the Magnificent Seven stocks advanced and paced the session. Amazon led as it rose by 2%.

Uber surged almost 4% despite reporting Q3 results that missed analysts’ expectations.

Arm Ltd shares rose 4% following reports that Nvidia and AMD are both planning to launch CPUs for Windows-based PCs using Arm-based chips.

The best performer overnight was cybersecurity stock Datadog, which rose 28% after stronger-than-expected Q3 earnings and a bullish full-year guidance.

Meanwhile, iron ore, gold and oil stocks on the ASX will be on watch today after Chinese data published yesterday evening showed that China’s exports fell by 6.4% year-on-year in October.

Crude prices dived -4% on the data to their lowest since July.

“Traders will also remain on high alert for signs of a wider conflict emerging in the [Middle East] region that could disrupt supplies, but it seems those fears are subsiding,” OANDA analyst Craig Erlam said.

Communicate your strategy more to investors, expert tells companies

Yesterday’s decision by the RBA to raise the cash rate by 25bp to 4.35% comes as no surprise, following the upward trend of the CPI data over recent months.

As a result, the retail investor community, which represents over a third of ASX market capital, will approach their investments with an increasingly frugal mentality.

That’s the view of Amy Benson, founder and CEO of investor communications company, Diolog, who also believes that tighter purse strings will lead to retail investors reviewing their investment strategies and considering liquidating investments if the risk appears to outweigh the reward.

“ASX companies need to look beyond how higher interest rates will impact their profit margins, and consider how they will also impact investors,” said Benson.

Benson said it’s vital that companies foster confidence amongst retail investors by acknowledging economic headwinds, and providing a clear path forward for investors to avoid a further dip.

“With more active retail investors than ever before, there is still a lot of work to be done to improve the relationship between publicly listed companies and Australia’s investor community.

“Building trust and confidence in long-term performance with more communication can be the competitive edge ASX companies need, as retail investors consider selling their positions following the interest rate hike,” she added.

In other markets …

Gold price fell -0.5% to US$1,968.67 an ounce.

Oil prices plunged -4%, with Brent trading at US$81.70 a barrel on sluggish Chinese data.

Iron ore futures slumped -0.5% to US$125.95 a tonne.

Base metals prices traded strong however, with 3-month nickel futures jumping by +1.22%, and copper futures by +076%.

The Aussie dollar fell -0.85% to US64.36c.

Meanwhile, Bitcoin was up +1.65% over the past 24 hours at US$35,578.

5 ASX small caps to watch today

James Bay Minerals (ASX:JBY)
JBY says it has swiftly moved to strategically increase the total land position of its 100%-owned La Grande Project in the Istchee-James Bay region in Quebec, Canada, through the staking of an additional 236 claims. The ~70% increase in the company’s total landholding across the La Grande Project stems from the success of its maiden field exploration program, desktop studies, regional activity success and results to date.

DevEx Resources (ASX:DEV)
Significant uranium mineralisation has been intersected in latest drilling along the U40 Fault Zone at the U40 Prospect, with new uranium equivalent (eU3O8) intercepts including: 16.9m @ 0.22% eU3O8, and 28.9m @ 0.10% eU3O8. These results highlight the growing scale of the system, says DevEx.

Elevate Uranium (ASX:EL8)
EL8 announced an updated JORC Inferred Mineral Resource Estimate of 48 Mlb eU3O8 for its Koppies Uranium Project in Namibia.The MRE increase represents a 136% increase in the Koppies resources, and a 42% increase in Elevate Uranium’s Namibian resources. Significant potential remains for resource expansion at Koppies and into the adjoining tenements, says the company.

Revolver Resources (ASX:RRR)
Assays from reconnaissance diamond drilling, combined with reassaying of previous drill core, has returned vein-scale endowment ranging from 0.1% to 3.7% copper, clearly evidencing proximity to a potential large-scale copper system. Project-level discussions are now well advanced with respect to potential new funding to accelerate exploration progress on this highly prospective Osprey tenement base.

HeraMED (ASX:HMD)
The medical data company announced that David Groberman has resigned as Chief Executive Officer and Managing Director with immediate effect, but will continue in a non-Executive role as Product Strategist. The role of CFO meanwhile will be outsourced to Shimony Finance Partner, Ido Toronchik following the transition of incumbent, Sivan Sadan.

At Stockhead we tell it like it is. While James Bay Minerals and Elevate Uranium are Stockhead advertisers, they did not sponsor this article.

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