Market Highlights: Shopify, Airbnb drag down Wall Street; and what’s been moving the gold price lately?

ASX to dip slightly at the open after a modest run on Wall Street
Shopify, Airbnb and Uber took a dive overnight after earnings release
What’s been moving the gold price?

Aussie shares are poised to open modestly lower on Thursday, in line with Wall Street’s moves. At 8am AEST, the ASX200 futures contract was pointing down by -0.2%.

Overnight, the S&P 500 ended its three-day winning streak, falling by -0.01%. The blue chips Dow Jones index was up by +0.44%, and the tech-heavy Nasdaq slipped by -0.18%.

Uber fell almost -6% after its forecasts didn’t quite hit the mark. The company swung to a loss last quarter as legal settlements and equity investments dragged down its results.

Shopify took a dive of almost -19%, shaving almost US$20 billion off the company’s value. The Canadian e-commerce company expects its revenue in Q2 to increase by a high-teens, but it’s slower than the growth it’s seen in the past few quarters.

Robinhood rose +4% after hours as the online trading platform topped Wall Street’s estimates for quarterly profits and revenue.

Airbnb meanwhile slid -8.5% post-market after Q1 results were in line with Wall Street expected. However, its revenue guidance for the June quarter was just a tad below what most analysts were thinking.

US stocks in general are bouncing back after a tough April, especially in sectors that haven’t been getting much love lately such as Utilities and Consumer Staples. These sectors usually do well when the economy isn’t doing so great.

Iron ore prices meanwhile fell almost -3% despite analysts’ predictions that China’s real estate market will pick up in the latter part of the year on the back of government stimulus.

According to an official of miner Vale, China’s iron ore imports for 2024 will be pretty much the same as last year, around 1.17 to 1.18 billion metric tons.

“In the near term, we are still seeing strong resilience in the Chinese economy, although the property market is slowing down in the next few years,” Eduardo Mello Franco down at Vale told a conference in Singapore yesterday.

What’s been moving the gold price lately?

The World Gold Council (WGC) has just released its Gold Market + ETF commentary reports for April 2024.

Gold had another good month in April, posting a 4% gain and ending the month at US$2,307/oz. Unlike March, gold finished off its intra-month high from probable buyer reticence and profit taking.

According to the WGC report, the things analysts usually look at to understand why gold prices go up or down haven’t been telling us the whole story.

Initially, WGC started looking at the usual suspects like geopolitical risks, and how much people are betting in Shanghai gold futures. That helped explain some of the changes we saw in March and April, but there’s still something important missing.

“In this context, we believe that central bank buying, recorded in our recent Gold Demand Trends report and in higher LBMA volumes, was once again a significant contributor to gold returns,” said the WGC report.

In summary, WGC believes the levels of inflation we are seeing are not as precarious as those seen during the 1970s period of stagflation.

“Our analysis suggests that we do not need a repeat of those extreme conditions for stocks to be under pressure.

“Conversely, gold will likely respond positively to the combination of sticky inflation and less than stellar growth.”

In other markets …

Gold price fell by -0.2% to US$2,309.85 an ounce.

Oil prices rose around +1%, with Brent crude now trading at US$83.72 a barrel.

The benchmark 10-year US Treasury yield was up 4 basis points (bond prices lower) to 4.50%.

The Aussie dollar fell -0.3% to US65.82 cents.

Bitcoin meanwhile was down another -3% in the last 24 hours to US$61,356.

5 ASX small caps to watch today

Summit Minerals (ASX:SUM)
A multispectral analysis targeting niobium mineralisation at the recently acquired Equador Nb-REE Project has been completed with 30 targets identified. The company said it has identified many possible niobium targets that require priority field confirmation and follow-up.

Askari Metals (ASX:AS2)
A total of 801 auger drilling samples were collected on a 500m x 500m grid at the 100%-owned Red Peak Project in WA, with the assay results demonstrating significant and high-grade Rare Earth Element (REE) mineralisation for both “light” and “heavy” Rare Earth Element group. Askari reported Total Rare Earth Oxide (TREO) results of up to 4505ppm TREO, with 15 results greater than 766ppm TREO.

Black Cat Syndicate (ASX:BC8)
The Kal East Gold Project Preliminary Feasibility Study (PFS) demonstrates strong financial returns from the base case production target. The PFS concluded an initial production target of 381koz @ 2.1g/t Au. Forecast average gold production of 51kozpa at 0.8Mtpa, and an All-In Sustaining Cost (AISC) of $1,724/oz. Operating cashflow after all capital and before tax is estimated at $400.5m ($3,500/oz gold price).

Mamba Exploration (ASX:M24)
Drilling has commences at the Canary Uranium Project in Canada, with approximately 1,000-1,500 metres planned across 3-4 drill holes, targeting shallow high-grade unconformity-related uranium mineralisation. One diamond drill hole will focus on the highest-priority target area along the northern electromagnetic corridor.

Melodiol Global Health (ASX:ME1)
ME1 says its wholly owned Canadian subsidiary, Mernova, continues to make strong operational progress in Q2. In the quarter, Mernova received purchase orders for $1.3m. This strong start to the quarter follows unaudited Q1 revenues of $1.75m, and FY23 revenues of $6.9m.

At Stockhead we tell it like it is. While Mamba Exploration and Melodiol Global Health are Stockhead advertisers, they did not sponsor this article.