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The ASX rallied 0.5% yesterday following the rate hike announcement as investor sentiment was boosted by hopes that the RBA is approaching the end of its tightening cycle. Every sector aside from materials stocks closed in the green yesterday. The winning stock yesterday by a mile was InvoCare (ASX:IVC) rocketing over 34% after the funeral company received a takeover offer from TPG Global at the value of $12.65 cash per share. TPG snapped up a 17.8% stake in InvoCare on Monday before making the takeover offer worth $1.8 billion.

Overnight in Europe, markets closed lower as investors digested comments made by Fed chair Jerome Powell at his congressional testimony, where he warned interest rates are likely to be higher than central bank policymakers previously expected. Germany’s DAX fell 0.6%, the French CAC lost 0.46% and, in the UK, the FTSE100 closed 0.13% lower.

Over in the US, local US investors also responded to Powell’s comments around rates needing to go higher for longer. The Dow Jones fell 1.72%, the S&P500 lost 1.53% and tech-heavy Nasdaq closed the day down 1.25%.

Software giant Atlassian has announced it will lay-off 500 full-time staff in a cost-cutting measure, just 6-months after co-founder Scott Farquhar went on a hiring-spree. Meta, the parent company of Facebook and Instagram, also announced a fresh round of lay-offs to come yesterday in order to meet financial targets.

What to watch today:

• Ahead of the local trading session the SPI futures are anticipating the ASX to open almost 1% lower on the back of the turbulent session on Wall St overnight.
• On the commodities front, oil is trading more than 3% lower at US$77.935/barrel, gold is down 1.54% at US$1818/ounce and iron ore is down almost 2% at US$126.50/tonne.
• Stocks going ex-dividend today include Costa Group (ASX:CGC), Woodside Energy Group (ASX:WDS), Brambles (ASX:BXB), Super Retail Group (ASX:SUL), and Blackmores (ASX:BKL). If you’ve been thinking about these stocks it might be worth considering buying in today as stocks going ex-dividend generally trade lower on the ex-dividend date.
• The Aussie dollar is buying US$0.66, 90.29 Japanese Yen, 56.19 British Pence and NZ$1.08.

Trading Ideas:

• Bell Potter has downgraded its rating on Eagers Automotive (ASX:APE) from a Buy to a HOLD but has increased its price target to $15.25 from $15. The price target increase is driven by sales of Chinese electric vehicle company BYD being greater than anticipated, however the downgrade to a hold is based on uncertainty around what, if any, extra provisioning must be taken around Scott’s going into administration and a potential easing in demand due to higher interest rates.
• Trading Central has identified a bullish signal on Endeavour Group (ASX:EDV) following the formation of a pattern over a period of 15-days which is roughly the same amount of time the share price may rise from the close of $6.72 to the range of $7.25 to $7.40 according to standard principles of technical analysis.