Wall Street rallies ahead of Jackson Hole meeting

US shares advanced on Monday, extending recent gains as investors looked ahead to the highly anticipated Federal Reserve symposium later this week.

The Dow Jones Industrial Average lifted 236.77 points, or 0.58 per cent, to close at 40,896.53. The S&P 500 rose 0.97 per cent to finish at 5,608.25, while the Nasdaq Composite jumped 1.39 per cent and ended at 17,876.77. The S&P 500 and Nasdaq notched their eighth straight day of increases, a first for both indexes in 2024.

Turning to US sectors, all closed higher overnight. Communication Services and Technology were the two leaders, closing higher by 1.44 per cent each. Consumer Staples recorded the fewest gains.

Small-cap stocks have continued to show renewed strength, closing higher by an additional 1.2 per cent overnight. A continued rally in the Russell 2000 index could indicate a risk-on appetite among investors, driving the overall equity market higher.

In company related news, AMD shares gained nearly 5 per cent after announcing the acquisition of ZT Systems for $4.9 billion to enhance its AI infrastructure capabilities and compete more effectively with Nvidia. Nvidia shares gained 4.4 per cent.

Estée Lauder's stock declined by 2.2 per cent following a disappointing first-quarter earnings report and a weak full-year outlook, causing investor concern.

Monday’s moves continued the recent market rally, which has followed a period of volatility. Last week marked the biggest gains for the three major indexes this year.

Investors are keen to get insights into the path of interest rates amid growing hopes for a potential rate cut. They will be closely watching Federal Reserve Chair Jerome Powell’s speech at the central bank’s symposium in Jackson Hole, Wyoming, on Friday. Before then, traders will scrutinise minutes from the Fed’s most recent meeting, due on Wednesday.
The Democratic National Convention also kicked off on Monday.

Turning to commodities, analysts have warned that diversification of critical mineral supply away from China would put the global energy transition goals in danger. The firm stated that China's removal from the world's copper supply chain would create a $85B gap for Western economies to fill.

Futures

The SPI futures are pointing to a 0.5 per cent gain.

Currency

One Australian dollar at 7.30am was buying 67.30 US cents.

Commodities

Gold has added 0.14 per cent. Silver has gained 1.60 per cent. Copper has added 0.93 per cent. Oil has lost 2.97 per cent.

Figures around the globe

European markets closed higher. London’s FTSE added 0.55 per cent, Frankfurt gained 0.54 per cent, and Paris closed 0.7 per cent higher.

Turning to Asian markets, Tokyo’s Nikkei lost 1.77 per cent, Hong Kong’s Hang Seng added 0.80 per cent, while China’s Shanghai Composite closed 0.49 per cent higher.

Yesterday, the Australian share market closed 0.12 per cent higher at 7980.45.

Ex-dividends
Computershare Ltd (ASX:CPU) is paying 42 cents unfranked
Magellan Fin Grp Ltd (ASX:MFG) is paying 35.7 cents 50 per cent franked

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

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