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In the US on Tuesday, Wall Street retreated from record territory as investors assess the potential impacts of escalating tensions in the Middle East. The Dow Jones fell 0.41%, the S&P500 lost 0.93% and the tech-heavy Nasdaq ended the day down 1.53%.

Energy stocks rallied on Wall St though on Tuesday as the price of West Texas Intermediate crude spiked after Israel Defence forces said Iran was firing missiles at the country.

The European markets ended Tuesday’s trading session mostly lower on escalating tensions in the Middle East, despite the release of favourable fresh Eurozone inflation data coming in at a decline of 0.1% for September which was lower than August’s reading of a 0.1% increase. On a yearly basis, the Eurozone inflation rate eased to 1.8% from 2.2% in August, in-line with market forecasts. The STOXX 600 fell 0.4%, Germany’s DAX lost 0.58%, the French CAC fell 0.81%, and in the UK, the FTSE100 ended the day up 0.48%.

Across the Asia region on Tuesday, markets closed mostly higher led by Hong Kong’s Hang Seng rising 2.43%, while Japan’s Nikkei added 1.93%, but South Korea’s Kospi Index fell 2.13% on Tuesday.

The local market started the trading month of October mixed with a record close on Monday before sliding 0.74% on Tuesday as Australian retail sales data came in hotter than economists’ were expecting, providing further evidence that inflation remains sticky, and the RBA shouldn’t consider cutting rates just yet. Materials stocks slid 2.3% while healthcare stocks rallied 1.12%. Retail sales rose 0.7% MoM in August which exceeded market forecasts of a 0.4% rise and was a rise for a 5th straight month.

Sigma Healthcare soared 23% on Tuesday after the pharmacy operator offered to make court-enforceable undertakings to satisfy the ACCC concerns over the company’s proposed merger with Chemist Warehouse.

Qantas shares fell 3.4% yesterday on news that Qatar Airways has moved to purchase of a 25% stake in Qantas rival, Virgin.

And REA Group rallied 5% yesterday after the leading real estate business confirmed it would abandon its takeover bid for Rightmove after the UK-based company rejected REA’s fourth bid in a number of weeks.

What to watch today:

• Ahead of the midweek trading session here in Australia the SPI futures are anticipating the ASX to open the day up just 0.02%.
• On the commodities front this morning, oil is trading almost 3% higher at US$70.18/barrel on supply fears out of the Middle East as tensions in the region escalate, while gold is up 1.04% at US$2662/ounce and iron ore is up 0.91% at US$93.83/tonne.
• The Aussie dollar is buying US$0.69, 99.07 Japanese Yen, 51.84 British Pence and NZ$1.10.

Trading Ideas:

• Bell Potter has maintained a hold rating on WiseTech Global (ASX:WTC) and raised the 12-month price target on the leading logistics software company from $115/share to $132.50/share post the release of the company’s FY24 result in August and news last month of DSV’s acquisition of Schenker (where DSV is a global rollout customer of WiseTech Global but Schenker is not. Bell Potter believes the stock looks expensive on an FY25 PE ratio and EV/EBITDA of 120x and 67x respectively hence the hold rating is maintained and the price target is raised based on the strong growth outlook.
• And Trading Central has identified a bullish signal on Autosports Group (ASX:ASG) following the formation of a pattern over a period of 69-days which is roughly the same amount of time the share price may rise from the close of $2.22 to the range of $2.28 to $2.32 per share according to standard principles of technical analysis.