Debt ceiling focus boosts S&P500 and Nasdaq to highest levels since Aug '22

Debt ceiling focus boosts S&P500 and Nasdaq to highest levels since Aug ’22

The S&P 500 and Nasdaq Composite jumped on Thursday to notch their highest closing levels since August 2022 as Wall Street traders kept focused on debt ceiling negotiations.

The major averages ticked higher into the end of the trading session, with the broad-market index adding 0.94 per cent to end at 4,198.05. The Dow Jones Industrial Average Finished up 115.14 points, or 0.34 per cent, to close at 33,535.91 after trading down for most of the session. The tech-heavy Nasdaq gained 1.51 per cent to finish at 12,688.84. The day marked a second consecutive positive session for the major averages.

Thursday’s advance boosted weekly gains for the indexes. The Nasdaq has led the charge up, on pace to end the week 3.3 per cent higher. The S&P 500 and Dow are poised to end the week up 1.8 per cent and 0.7 per cent, respectively.

House Speaker Kevin McCarthy said Thursday that he’s optimistic congressional negotiators could reach a deal in time for a House vote next week.

His comments come with just two weeks until June 1, which is the earliest day the US could default, according to Treasury Secretary Janet Yellen.

Retail giant Walmart helped the market, adding 1.3 per cent on the back of its strong financial report. The company beat Wall Street forecasts on both earnings per share and revenue in its first quarter and raised its expectations for full-year performance.

But investors’ sentiment was reined in somewhat after Dallas Fed President Lorie Logan said the latest economic data doesn’t argue for a pause in rate hikes yet. She noted the June policy decision will be based on inflation and employment data that hasn’t been released yet.

In commodity news, India is considering importing 1.25 million tons of oil to replenish its depleted reserves, following the United States' lead, while the lithium mining industry saw gains based on predictions of a turnaround in lithium prices.

China's lithium carbonate prices have surged by 44 per cent in the past three weeks, reaching $34K per ton. Among lithium producers, Albemarle received analyst upgrades and Lithium Americas reported better-than-expected Q1 earnings, while Critical Elements and Electra experienced significant stock declines following project updates.

The European Union (EU) is actively working on agreements with Argentina and Chile to increase its access to crucial minerals and metals required for electric vehicle (EV) batteries, aligning with its objective of transitioning to a low-carbon economy. This initiative is part of the EU's broader strategy to secure resources for its clean-energy and digital transformation, diversify its supply chain, and reduce reliance on a limited number of suppliers, including China. The EU aims to finalise these preliminary agreements within the next four months, according to the European Commission.

Overall, the US sectors were mixed. Tech was the best performer, whilst Real Estate was the worst.

Futures

The SPI futures are pointing to a 0.2 per cent gain.

Currency

One Australian dollar at 7:10 AM is buying 66.23 US cents..

Commodities

Iron ore futures are pointing to a 1.6 per cent fall..

Gold dropped 1.24 per cent. Silver fell 0.99 per cent. Copper lost 1.60 per cent and oil fell 1.18 per cent.

Figures around the globe

Across the Atlantic, European markets closed higher. London’s FTSE added 0.25 per cent, Frankfurt gained 1.33 per cent while Paris closed 0.64 per cent higher.

In Asian markets, Tokyo’s Nikkei gained 1.60 per cent, Hong Kong’s Hang Seng added 0.85 per cent while China’s Shanghai Composite closed 0.40 per cent higher.

Yesterday, the Australian sharemarket closed 0.52 per cent higher at 7237.

Ex-dividends

GQG Partners (ASX:GQG) is paying 2.0952 cents unfranked
US Student Housing REIT (ASX:USQ) is paying 1.61 cents unfranked
WAM Leaders (ASX:WLE) is paying 4.5 cents fully franked

Dividends payable

Dexus Industria REIT (ASX:DXI)
Dexus Convenience Retail REIT (ASX:DXC)
Jupiter Mines (ASX:JMS)
Cromwell Property Group (ASX:CMW)

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.
Disclaimer

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