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Wall Street ended Friday’s session mostly in the red as the theme has gone in the U.S. over the last week with investor jitters rising amid fears of a pushback in the rate cut outlook from the Fed due to inflation remaining sticky in the world’s largest economy.

The Nasdaq fell over 2% on Friday as investors retreat from chip stocks including Nvidia plummeting 10%, and Netflix falling 9% even after quarterly results beat market expectations. The Dow Jones bucked the downfall trend on Friday by rising 0.56%, while the S&P500 slipped 0.88%. While investor sentiment in the U.S. has primarily been focused on the rate outlook over the last week, investors have also been equally as concerned over rising tensions in the Middle East.

The S&P500 had its worst week last week since March 2023 while the Nasdaq lost 5.5% and the Dow Jones gained 0.01% over the trading week.

Over in Europe markets it was a different story as investor sentiment was boosted by rate cut speculations out of the ECB. The STOXX600 rose 0.3% on Friday, Germany’s DAX fell 0.55%, the French CAC closed flat and, in the UK, the FTSE100 rose 0.24%. Banks led the gains in the region while energy stocks dropped 1.5% on the sliding price of oil.

In Asia on Friday, markets tumbled amid escalating tensions in the Middle East, particularly on the back of Israel’s attack on Iran. Japan’s Nikkei fell 2.66% on Friday as key inflation data in the region indicated headline inflation fell to 2.7% in March, from 2.8% in February. South Korea’s Kospi index fell 1.63%, and Hong Kong’s Hang Seng fell 0.99%.

Locally on Friday the ASX200 fell just shy of 1% as all 11 sectors closed the day in the red led by the rate sensitive sectors as tech dropped 1.55% and REIT stocks fell 1.45%. Karoon Energy fell 5.4% on Friday after downgrading guidance for oil production in FY24.

The price of gold rallied to a record high on Friday above US$2400/ounce as the safe-haven asset soars in popularity both from investors and global banks amid rising geopolitical tensions and deflationary pressures in certain key economies around the world.

What to watch today:

• Ahead of the first trading session to start the new week, the SPI futures are expecting the ASX to open the trading day down 0.6%, extending on the negative sentiment from last week.
• On the commodities front this morning oil is down 0.1% to trade at US$83.03/barrel, gold is down 0.3% at US$2384/ounce and iron ore is up 0.28% at US$108.25/tonne.
• AU$1.00 is buying US$0.64 cents, 99.30 Japanese Yen, 51.87 British Pence and NZ$1.09.

Trading Ideas:

• Bell Potter has increased the 12-month price target on Gold Road Resources (ASX:GOR) from $1.85 to $2.10 and maintained a buy rating on the gold producer following the release of the 1Q24. Despite significant rain events impacting production and damaging the road supply route to the company’s Gruyere project, Bell Potter’s analyst believes the mining issues have now been overcome and the company’s share price to recover, supported by gold price tailwinds.
• And Trading Central has identified a bearish signal on Sigma Healthcare (ASX:SIG) following the formation of a pattern over a period of 27-days which is roughly the same amount of time the share price may fall from the close of $1.25 to the range of $1.08 to $1.12 according to standard principles of technical analysis.