The US market took off, in a fashion I’ve not seen in my career, after Trump sent this message on his social media platform:
“Authorised a 90 day PAUSE, and a substantially lowered Reciprocal Tariff during this period, of 10%, also effective immediately. Thank you for your attention to this matter!”
Thank you for your attention on this matter! I actually laughed at that last sentence.
Here’s what we saw:
- S&P 500 = +8.82%
- Nasdaq = +11.6%
- Aussie dollar = +3.1c to US$61.44
- Iron ore = -1.1% to US$93.75 per tonne
- ASX SPI indicates a 6% increase
Keeping our eye on Australian pharmaceuticals
Yesterday the ASX 200 closed down 1.8%. The sector hit the most was our pharmaceuticals, which were included in the on-again off-again tariffs. This saw CSL Limited (ASX:CSL), one of our highest quality companies drop 4.96%. Mesoblast Limited (ASX: MSB) was hit 8% and Neuren Pharmaceuticals Ltd (ASX: NEU) fell 6.14%. A bad day for Melbourne-based pharma.
If you have not followed NEU previously it is worth a look. The company is a developer of therapies for neurodevelopment disorders – these include Rhett syndrome and Fragile X. In 2021 the stock traded between $1 and $2. In 2023 Neuren soared to over $24 on the back of strong sales of its drug, Daybue, and positive FDA results. Since then the wind has been taken out of its sails. The share price currently sits at $8.72.
Look for the companies that don’t bounce
What are we watching today?
In short, everything. On a day when the US bounces hard and our futures indicate a 6% rise the tide should lift all boats. iShares S&P 500 (ASX:IVV) and Betashares Nasdaq 100 ETF (ASX: NDQ) holders will have a smile on their face although there’s still a lot to recover.
Of course, we’ll have a keen eye on our materials and energy sectors which have been the hardest hit, but you want to keep an eye out for those who don’t budge. It will be a fantastic indicator of sentiment.
I’ll have half an eye on embattled former market darling, Mineral Resources Limited (ASX:MIN).
After a series of own goals the company is down a casual 79% over the last twelve months. It’s facing a class action, soft commodity prices, an ASIC investigation, the very real potential for a capital raise and the majority of executives are still in their seats. It will be very interesting to see what appetite investors have for it today.
Thank you for your attention on this matter!
