Australian stocks rallied to record highs this week due to easing inflation and positive corporate results, raising hopes for a February rate cut. The upcoming earnings season will reveal the impact of factors like subdued Chinese demand, a weakening Australian dollar, and fluctuating commodity prices on various sectors, including miners, tech, REITs, and consumer discretionary.

In this week’s wrap, Grady covers:

• (0:50): China’s signs of a post- pandemic recovery
• (1:31): what the gold rally means for gold producers
• (2:11): the performance of mining stocks
• (3:30): what to expect this reporting season
• (4:23): how the local market performed this week so far
• (5:11): the most traded stocks & ETFs by Bell Direct clients
• (5:38): economic news items to watch out for.

Wall St fell overnight as the Federal Reserve left interest rates unchanged in its first policy decision of the year. The Dow Jones fell 0.31%, the S&P 500 dropped 0.47% and the tech-heavy Nasdaq closed just over half a percent higher.

Over in Europe, markets closed higher as corporate earnings results start to get released. The STOXX600 rose by half a percent with gains lead by the technology sector which rose by 2%. Germany’s DAX jumped nearly 1%, the French CAC fell 0.32% and over in the UK the FTSE100 rose by 0.28%.

Locally yesterday the ASX200 rose by 0.57% following the release of important inflation data. The quarterly inflation print has boosted investor sentiment and hopes for the RBA rate cut cycle to begin in February as underling inflation fell at a sharper rate than expected to the lowest level in 3-years of 3.2% for the December quarter.

Star Entertainment shares rose over 13% yesterday after the company made its first sale of non-core assets to the value of $60m for the sale of its Sydney entertainment centre assets. While it isn’t enough to revive the company, it is a welcome start on the journey to rebuilding.

What to watch today:

• The Australian share market is set to open lower with the SPI futures suggesting a fall of 0.06% at market open this morning.
• On the commodities front this morning,
  • Oil is trading 1.08% lower at 72 US dollars and 97 cents a barrel following concerns over rising US stockpiles.
  • Gold is trading 0.21% lower at 2756 US dollars an ounce and iron ore is trading 0.04% lower at 101 US dollars and 30 cents a tonne.

Trading Ideas:

• Bell Potter has slightly increased the 12-month price target on Pilbara Minerals (ASX:PLS) from $2.95 to $3.00 and maintain a buy rating on the leading lithium producer following the release of the company's 2Q25 results. Despite depreciated pricing of lithium in the current cycle, PLS beat analysts' expectations for sales volumes and average realised pricing.
• Trading Central has identified a bullish signal on Endeavour Group (ASX:EDV) following the formation of a pattern over a period of 41-days which is roughly the same amount of time the share price may rise from the close of $4.23 to the range of $4.37 to $4.41 according to standard principles of technical analysis.

In the US on Tuesday stocks recovered after the sharp sell-off following the emergence of China’s DeepSeek AI model that offers a lower cost alternative to the billions the US is spending in the AI space. The Nasdaq rallied 2.03%, the S&P500 climbed 0.92% and the Dow Jones ended the day up 0.31%. The DeepSeek AI sell-off on Wall St was due to social media buzz over the weekend around the Chinese startup unveiling a free open-source large language model of AI that it says took less than $6 million to build.

In Europe overnight, markets in the region also mostly rebounded on Tuesday in the in the wake of the global AI sell-off that spread through global markets on Monday. The STOXX 600 rose 0.5%, Germany’s DAX added 0.7%, the French CAC fell 0.12% and, in the UK, the FTSE100 ended the day up 0.35%.

Across the Asia region overnight, markets closed mixed as the AI-sell off continued to spread throughout the region. Japan’s Nikkei extended losses for a second session with a loss of 1.4% on Tuesday as China’s AI advancements threaten to challenge the US dominance in the space which flows through to countries like Japan who form a key part of the US AI-chip supply chain, while Hong Kong’s Hang Seng rose 0.14%, and South Korea’s Kospi Index ended the day up 0.85%.

The local market closed the first trading session of the week down 0.12% as fears of China’s AI rival DeepSeek taking power on the AI front dampened investor sentiment to start the holiday shortened trading week.

The datacentre, AI and broad tech rally of the last year took a sudden halt yesterday with local darlings in the sector like Goodman Group, and NextDC each falling over 6% amid the emergence of China’s DeepSeek AI rival and overvaluation fears in the sector.

The DeepSeek fear-based sell-off expanded into the uranium space, sending Paladin Energy and Boss Energy down over 10% each as investors fear less uranium will be needed to fuel nuclear power for the global AI revolution.

Sigma Healthcare rose over 12% yesterday after the Chemist Warehouse merger partner reported a strong trading update from Chemist Warehouse for the first half of FY25 including record sales, up 13% on the PCP, margin expansion through cost management and the opening of 19 new stores in the half. Sigma is set to merge with the discount chemist retail giant next month.

What to watch today:

• Ahead of the midweek session the SPI futures are anticipating the ASX will open the day up 0.43% tracking Wall Street’s rebound on Tuesday so far.
• On the commodities front this morning oil is trading 0.01% lower at US$73.17/barrel, gold is up 0.6% at US$2757.72/ounce and iron ore is flat at US$101.34/tonne.
• The Aussie dollar has slightly weakened against the greenback to buy US$0.62, 97.19 Japanese Yen, 50.22 British Pence, and NZ$1.10.

Trading Ideas:

• Bell Potter has slightly increased the 12-month price target on Bellevue Gold (ASX:BGL) from $1.90 to $2.00 and maintain a buy rating on the gold producer. Despite weaker 2Q production leading to a FY25 guidance downgrade, the analyst sees upside to the share price from continuing improvement in production and cost performance in ongoing production ramp-up and expansion, strong gold prices and near-mine exploration programs.
• And Trading Central has identified a bullish signal on Accent Group (ASX:AX1) following the formation of a pattern over a period of 37-days which is roughly the same amount of time the share price may rise from the close of $2.38 to the range of $2.75 to $2.85 according to standard principles of technical analysis.

In the US on Monday the S&P500 and Nasdaq fell sharply to start the week lower on investor concerns about the AI bubble bursting due to the emergence of Chinese startup DeepSeek which has possibly made a competitive AI model for a fraction of the cost of the billions Silicon Valley is spending in the space. The Nasdaq tumbled 3.07% and the S&P500 lost 1.46%, while the Dow Jones ended the day down 0.65%.

European markets closed slightly lower on Monlday as investors reacted to the breakout of a new Chinese AI competitor. The STOXX 600 fell 0.07%, Germany’s DAX lost 0.53%, the French CAC fell 0.27% and, in the UK, the FTSE100 ended the day flat.

Across the Asia region, markets closed mostly higher on industrial profits in China and on the emergence of an AI rival in China. Japan’s Nikkei fell 0.92% in the days after the Bank of Japan increased the country’s cash rate to the highest level in 17-years, while Hong Kong’s Hang Seng rose 0.66%, China’s CSI index added 0.41% and South Korea’s Kospi Index gained 0.85%. China’s industrial profits jumped 11% from on the PCP, but for the year profits declined for a third straight year in data out yesterday for the month of December.

The local market was closed on Monday for the Australia Day holiday but on Friday the ASX200 posted a 0.36% gain on Friday to end a strong week on the local index following strength in the US on Thursday and strong corporate earnings reports boosting investor sentiment.

Synlait Milk soared 24% on Friday after reporting an impressive turnaround in operations in the first half and increased its guidance for the second half, with an outlook to a return to profitability this year. The milk producer underwent an aggressive cost cutting strategy through reducing head count and is set to increase prices to drive margin appreciation in the second half.

Oil producers locally on Friday tumbled tracking the declining price of oil amid Trump’s comments urging OPEC plus to bring down the price of oil.

What to watch today:

• Ahead of the first trading session of the new trading week the SPI futures are anticipating the ASX will open the day up 0.17%.
• On the commodities front this morning oil is trading 2.06% lower at US$73.14/barrel, gold is down 1.05% at US$2741/ounce and iron ore is flat at US$101.34/tonne.
• The Aussie dollar has strengthened overnight against the greenback to buy 62.85 US cents, 97.24 Japanese Yen, 50.28 British Pence and 1 New Zealand dollar and 11 cents.

Trading Ideas:

• Bell Potter has slightly decreased the 12-month price target on Kogan.com (ASX:KGN) from $5.30 to $5.10 and maintain a hold rating on the online retailer following the release of the company’s preliminary 1H25 update including adjusted EBITDA missing expectations driven by an incremental increase in marketing investment during the promo period and the Mighty Ape re-platforming related issues which persisted through October.
• And Trading Central has identified a bearish signal on Healius (ASX:HLS) following the formation of a pattern over a period of 290-days which is roughly the same amount of time the share price may fall from the close of $1.41 to the range of $0.70 to $0.85 according to standard principles of technical analysis.

The ASX200 posted a gain of 0.82% (Monday – Thursday) this week, led by strength for tech, financials, and industrial stocks. Our local market also took strong lead from Wall Street’s Trump rally that saw the S&P500 hit a fresh record.

In this week’s wrap, Grady covers:

• (0:10): tariff announcements in Trump’s first days back in office
• (2:19): why financials & gold stocks rallied this week
• (3:57): the best & worst performing stocks on the ASX200
• (4:59): the most traded stocks & ETFs by Bell Direct clients
• (5:29): economic news items to watch out for.

In the US today on Wednesday the Trump 2.0 fuelled rally extended into the midweek session, sending the S&P500 to a fresh all-time high, up 0.61%, while the Dow Jones rose 0.3% and the Nasdaq ended the day up 1.28%. Strong corporate earnings results are also fuelling the strength in equities with Netflix jumping over 9% after surpassing 300 million paid memberships inQ4, while Procter & Gamble added nearly 2% on earnings topping expectations.

In Europe overnight, markets closed mostly higher on strong corporate earnings results in the region which boosted Germany’s DAX to an all-time high again on Wednesday with a gain of 1.01%. The French CAC rose 0.86%, but, in the UK, the FTSE 100 ended the day down just 0.04%. Sportswear giant Adidas rose 6% on the German index on Wednesday after sales grew by 19% in Q4 results.

Across the Asia region on Wednesday markets closed mixed led by China’s CSI index falling 0.93% as President Trump signalled his plans to impose a 10% tariff on China. Hong Kong’s Hang Seng also fell 1.72% on Wednesday while South Korea’s Kospi index rose 1.15%, and Japan’s Nikkei ended the day up 1.58%.

The local market closed the midweek session 0.33% higher, extending on Tuesday’s gains as 7 of the 11 sectors ended the day higher. Our big miners came under pressure yesterday though after US President Donald Trump said he was considering a 10% tariff on China which Australia is reliant on for key commodity trade.

Technology shares rose on Wednesday after Netflix posted its biggest quarterly subscription gain ever in afterhours trade in the US, fuelling investor hopes for broad growth in the tech sector on an earnings front.

Woodside shares fell almost 2% yesterday after the oil and gas producer released the most recent quarterly results including production falling 3% due to weaker seasonal demand.

Bub’s Australia soared 22.5% on Wednesday after the infant formula producer reported a sharp turnaround in 1H earnings with the company achieving EBITDA of $2.9m following a $6.8m loss in the PCP.

What to watch today:

• Ahead of Thursday’s trading session here in Australia the SPI futures are anticipating the ASX will open the day down 0.35%.
• On the commodities front this morning, oil is trading 0.1% higher at US$75.97/barrel, gold is up 0.48% at US$2757/ounce and iron ore is flat at US$101.21/tonne.
• The Aussie dollar has further strengthened overnight to buy US$0.62, 98.29 Japanese Yen, 50.76 British Pence and NZ$1.11.

Trading Ideas:

• Bell Potter has increased the 12-month price target on Paladin Energy (ASX:PDN) from $10.50 to $10.70 and maintain a buy rating on the uranium producer following the release of a second quarter update including operational gains at its Langer Heinrich Mine in Namibia with production of 640 thousand pounds which beat BPe and C1 costs of US$42.3/pound which fell below BPe which was a welcome result.
• And Trading Central has identified a bullish signal on Perseus Mining (ASX:PRU) following the formation of a pattern over a period 85-days which is roughly the same amount of time the share price may rise from the close of $2.83 to the range of $3.25 to $3.35 according to standard principles of technical analysis.

Wall St was closed overnight due to the Martin Luther King Jr public holiday whilst Donald Trump was inaugurated as the 47th president of the United States.

Over in Europe, markets closed slightly higher as investors react to Donald Trump being sworn in as the US president. The STOXX600 closed 0.05% higher with mining stocks leading gains up 1.2%. Germany’s DAX rose by 0.42%, the French CAC jumped 0.31% and over in the UK the FTSE100 climbed 0.18%.

Locally yesterday, the ASX200 rose by 0.45% with most major sectors closing in the green. Gains were led by the information technology and real estate sectors which rose by 1.13% and 0.78% respectively. This was offset by the energy sector which fell by over half a percent by the closing bell.

What to watch today:

• The Australian share market is set to open higher, with the SPI futures suggesting a rise of 0.34% at market open this morning.
• On the commodities front this morning,
  
  • Oil is trading 1.83% lower at 76 US dollars and 45 cents a barrel as markets reacted to Donald Trump’s pledge to expand domestic crude production.
  • Gold is trading 0.18% higher at 2705 US dollars an ounce and iron ore is trading 0.72% higher at 101 US dollars and 21 cents a tonne.

Trading Ideas:

• Bell Potter maintains a buy rating on Genusplus Group (ASX:GNP) and keeps an unchanged 12-month price target of $3.10. The buy rating has been maintained by Bell Potter as GNP has been awarded a new $140m contract by Ausgrid for sub-transmission line works at the Hunter-Central Coast Renewable Energy Zone project. The contract award is material and bolsters GNP’s orderbook in the medium term, hence the buy rating is maintained.
• And Trading Central has identified a bullish signal on Beacon Lighting Group (ASX:BLX), indicating that the share price may rise from the close of $3.05 to the range of $3.60-$3.70, on a pattern formed over 70 days, according to the standard principles of technical analysis.

Wall St closed higher on Friday to post the firstly weekly gain across the three major averages for the year as the big tech rally resumed momentum. The Dow Jones rose 0.78% on Friday and 3.7% for the week, the S&P500 added 1% on Friday and 2.9% for the week, and the Nasdaq ended Friday’s session up 1.51% and added 2.5% for the week. In Europe on Friday the positive investor sentiment extended into the European region buoyed by a strong rally for mining stocks. The STOXX 600 rose 0.68%, Germany’s DAX added 1.35%, the French CAC gained 0.98%, and, in the UK, the FTSE100 ended the day up 1.35%. Across the Asia markets on Friday it was a mixed session as strong economic data in China boosted investor sentiment in the region. China’s CSI index rose 0.31% on Friday after fresh GDP data showed the Chinese economy expanded by 5% YoY and retail sales rose 3.7% which beat expectations. Hong Kong’s Hang Seng rose 0.21% on Friday and Japan’s Nikkei fell 0.31% at the closing bell. Locally on Friday, the ASX200 took lead from Wall Street’s losses overnight to post a 0.2% loss on Friday as the financials weighed on the key index. The pullback followed the ASX200 rising 1.4% on Thursday so for the week the key index still managed a gain of 0.2% last week.

On an economic data front on Friday, we had the highly anticipated retail sales, industrial production, and GDP readings out of China. The Chinese economy expanded 5.4% in Q4 which was above the 5% forecast and above the 4.6% recorded in Q3 which is a welcome sign of material recovery in the region post pandemic. Retail sales further supported the recovery story with a rise of 3.7% in December which beat the 3.2% economists were expecting and is a sharp rise from the 3% reported in November. And Industrial production in the region also rose 6.2% in December on an annual basis which also exceeded expectations and was a sharp rise from the 5.4% reported in November. Overall, the economic growth in China is finally starting to show signs of material turnaround and this boosted the iron ore price and stocks with exposure to the region on Friday.

The winning stocks on the ASX200 on Friday were led by Megaport rallying 10.10%, Liontown Resources rising 9.5% and Lovisa adding 7.73%. And on the losing end REA Group fell 2.71%, TPG Telecom lost 2.4% and JB Hi-Fi ended the day down 2.15%.

Insignia Financial is the talk of the M&A world right now as Bain Capital and CC Capital fight to acquire the nearly 200-year-old Aussie wealth management company. Shares in Insignia rose 6% on Friday after CC Capital increased its takeover offer to a value over $3bn or $4.60/share, above the $4.30/share Bain matched earlier this week. How this one plays out will be very interesting but it’s no wonder why CC and Bain want to acquire Insignia as the purchase will give the acquirer a market leadership position in Australia’s over $4tn superannuation market. And Telix Pharmaceuticals rose 4% on Friday after the cancer imaging and therapy pharmaceuticals company received approval from Europe’s Marketing Authorisation Application for its prostate cancer imaging agent Illucix which already has FDA and TGA approval. This further expansion into Europe broadens the company’s revenue runway for its leading agent Illucix.

What to watch today:

• Ahead of the first trading session of the new trading week the SPI futures are anticipating the ASX will open the new day up 0.34%.
• On the commodities front this Monday morning, oil is trading 1.02% lower at US$77.88/barrel, gold is down 0.5% 2700.99/ounce and iron ore is up 0.72% at US$101.21/tonne.
• The Aussie dollar is buying US$0.61, 96.85 Japanese Yen, 50.88 British Pence and NZ$1.11.

Trading Ideas:

• Bell Potter has reduced the 12-month price target on Lynas Rare Earths (ASX:LYC) from $7.70 to $7.20 and maintain a hold rating on the rare earths producer following the release of a 2nd quar