ASX 200 set to open lower despite positive Wall Street session
Nvidia surpasses Microsoft as world’s largest company
But expert says investors should look beyond Nvidia
The ASX 200 is poised to open lower when the market opens on Wednesday despite a positive session on Wall Street. At 8am AEST, the ASX 200 futures contract was pointing down by -0.1%.
Overnight, the S&P 500 rose by +0.25% to its 31st all time high in 2024, the blue chips Dow Jones index was up by +0.15%, and the tech-heavy Nasdaq lifted modestly by +0.03%.
Nvidia has now become the world’s largest and most valuable company after rising by +3.5% and eclipsing Microsoft overnight, with a market cap that stands at US$3.34 trillion.
Microsoft is capped at US$3.32 trillion, while Apple, which is in third spot, is at US$3.29 trillion.
As well as the biggest, Nvidia is also the most traded stock on Wall Street, with an average daily trading volume of US$50 billion, dwarfing other other major tech stocks which each average around US$10 billion daily.
Boeing Co fell -2% as CEO Dave Calhoun encountered sharp criticism during his Senate hearing, where he was accused of prioritising profit over safety and not adequately addressing the company’s manufacturing issues.
Philip Morris slipped -0.8% after halting online sales of its popular nicotine pouch brand, Zyn, in the US following a subpoena from the District of Columbia concerning the sale of prohibited flavoured products.
Dollar Tree tumbled -1.3% after US regulators said the company has continued selling children’s apple sauce with “extremely high” lead levels, despite a recall issued over contamination concerns.
Meanwhile, oil prices hit their highest point in over a month last night, following reassurances from OPEC+ that any increase in the cartel’s production output will be contingent on market conditions.
And..Wall Street traders also parsed through a blend of economic reports. US industrial production saw a boost from increased factory output, but retail sales showed minimal growth.
Look beyond Nvidia for a solid portfolio
Nvidia’s rapid rise to become the world’s largest company highlights its leadership in AI, with its stock soaring over 200% in the past year.
However, Nigel Green, CEO of deVere Group, urges investors to diversify beyond Nvidia for sustained wealth growth.
“Focusing solely on giants like Nvidia may not be the most strategic approach for investors aiming to build long-term wealth,” Green advised.
He suggests exploring diverse sectors like cloud computing, data analytics, and AI-driven services, as well as emerging startups pioneering innovations in specialised AI applications.
Green emphasised the importance of including infrastructure providers and semiconductor companies developing AI-specific technologies in investment portfolios.
These sectors, he says, play pivotal roles in supporting AI advancements and offer opportunities for long-term growth.
“Beyond Nvidia, other semiconductor companies are investing heavily in AI-specific chipsets. These components are crucial for enabling the computational power required by the tech’s algorithms,” Green said.
“By including these hardware providers in an investment portfolio, investors can gain broader exposure to the fundamental technologies driving AI advancements.”
Green concludes: “Nvidia’s success highlights AI’s enormous potential, but focusing solely on the titans is likely to mean missed opportunities to build long-term wealth.”
In other markets …
Gold price rose by +0.35% to US$2,328.86 an ounce.
Oil prices were up around +1.5%, with Brent crude now trading at US$85.32 a barrel.
The benchmark 10-year US Treasury yield fell by 6 basis points (bond prices higher) to 4.23%.
The Aussie dollar was up by +0.6% to 66.58 cents.
The iron ore price lifted by +1% to US$106.40 a tonne.
Bitcoin meanwhile tumbled by -2% last 24 hours to US$65,125 while Ethereum was down -1.3% to US$3,475.
5 ASX small caps to watch today
Tivan (ASX:TVN)
Tivan is advancing the developmentof two distinct vanadium processing methods for its Speewah Vanadium Project in WA. One method, TIVAN+, developed in collaboration with CSIRO, has shown promising results, confirming its technical viability for processing Speewah concentrate. Meanwhile, conventional salt roast processing has also yielded excellent results, supporting the production of high-purity vanadium electrolyte to meet Sumitomo Electric Industries’ specifications. Tivan plans to reassess its strategy and determine the preferred technology pathway for the Speewah following the completion of the Pre-Feasibility Study for the Speewah Fluorite Project in July.
Kingsland Minerals (ASX:KNG)
KNG’s Leliyn Graphite Project has unveiled a globally significant exploration target, underscoring its potential scale. Recent updates include a substantial graphite resource of 194.6 million tonnes at 7.3% Total Graphitic Carbon (TGC), containing 14.2 million tonnes of graphite. Initial metallurgical tests have yielded a concentrate with over 94% TGC, with ongoing studies optimising flotation for fine flake concentrate. Future work aims to evaluate the production of spherical graphite as a precursor for Electric Vehicle battery anode material.
Catalyst Metals (ASX:CYL)
Catalyst has successfully repaid a convertible note, reducing its debt to only 2,590 ounces remaining in the form of a gold loan. Over the past year, the company has made significant strides in repairing its balance sheet by repaying $28 million of debt, which originated from the acquisition of Vango Mining and the Plutonic Gold Belt consolidation in July 2023. The remaining gold loan will be settled in seven monthly instalments and represents just 2.5% of Catalyst’s annual gold production. Currently, Catalyst maintains $22 million in available cash and $30 million in liquidity.
Kuniko (ASX:KNI)
Geophysical surveys conducted at the Ertelien Nickel-Copper-Cobalt Project in Southern Norway have revealed five new electromagnetic conductors. These surveys, conducted in April and May, targeted areas previously unexplored within the Ertelien intrusion. KNI says the newly identified conductive horizons suggest potential extensions of high-grade sulphide mineralisation. The next steps involve ground truthing these findings through surface mapping and sampling starting in July. This data, combined with drill results, will guide the identification of new drilling targets aimed at expanding the existing 23 million tonnes inferred Mineral Resource Estimate and potentially upgrading resources from inferred to indicated categories.
AustChina Holdings (ASX:AUH)
Drilling has begun at the Chenene Lithium Project in Tanzania, targeting multiple high-priority lithium prospects. Initial diamond core drilling involves 8 holes initially, with potential for expansion. The first hole has encountered pegmatite starting from a depth of 6 meters, near surface outcroppings. Meanwhile, AustChina has also signed an Exclusive Binding Heads of Agreement to conduct due diligence on acquiring four licenses from Cassius Mining.
At Stockhead we tell it like it is. While Kingsland Minerals is a Stockhead advertiser, it did not sponsor this article.
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