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Well US investors took the Federal Reserve’s latest comments on taming inflation positively, as equities moved higher overnight in New York. Stocks initially fell during a Q&A session from the Fed Chairman Jerome Powell at the Cato Institute. He signalled that there wouldn’t be a pause in rate hikes or a pivot to cutting interest rates anytime soon. US equities however ended the session with gains. The Dow Jones closed up 0.6%, the S&P500 up 0.7% and the Nasdaq up 0.6%.

European markets closed higher, after the European Central Bank announced a 75-basis point interest rate rise. The STOXX 600 closed 0.5% higher.

What to watch today:

• The Australian market is set to open flat this morning. The SPI futures are up 5 points.
• In commodities,
  • Oil is trading 2% higher. The price is rebounding after tumbling almost 6%, as investors weighed on supply concerns. Also President Vladimir Putin said Russia was to immediately stop oil supply to countries that support the G7’s initiative to cap prices on oil exports or the EU’s plan to place a ceiling on Russia natural gas sales. Although the oil price is currently trading in higher, it still remains close to the 8-month low, which was reached when monetary tightening and COVID lockdowns weighed on demand. Today, keep watch of Woodside Energy (ASX:WDS), Beach Energy (ASX:BPT), Santos (ASX:STO) and other energy producers.
  • The gold price is lower, after caution dominated sentiment ahead of the Jerome Powell’s speech and the ECB’s rate hike announcement. Watch gold miners such as St Barbara (ASX:SBM) and Newcrest Mining (ASX:NCM).
  • Iron ore has also dropped, approaching the nine-month low it reached earlier in the month.
• Stocks going ex-dividend today, which may see share prices fall as investors take profits, include Nine Entertainment (ASX:NEC) and WiseTech Global (ASX:WTC).

Trading Ideas:

• Bell Potter maintain a Speculative Buy rating on De Grey Mining (ASX:DEG). Bell Potter have increased their price target from $1.80 to $1.97. At its current share price of $0.97, this implies 103% share price growth in a year.
• Trading Central have identified a bearish signal in Metcash (ASX:MTS), indicating that the stock price may fall from the close of $4.11 to the range of $3.79 to $3.85 over 10 days, according to the standard principles of technical analysis.