Market Highlights and 5 ASX Small Caps to Watch on Friday

  • US stocks plunge in broad-based sell-off
  • Block Inc falls 10% on NYSE as earnings disappoint
  • ASX will open 1.5% lower this morning

ASX to fall as Wall Street plunges

The ASX 200 will open much lower this morning, following a broad sell off on Wall Street. At 8am AEDT, the ASX 200 June futures contract is pointing down more than 1.50%.

Overnight, Wall Street erased all of yesterday’s gains with all three major indices falling sharply: the S&P 500 down 3.56%, the Dow down 3.12% and the Nasdaq Tech down a hair-raising 4. 99%.

It was the worst day for US stocks in 2022 as investors reassessed the effectiveness of the Fed’s plan to tackle inflation announced on Wednesday.

US Fed Chairman Powell raised the Fed cash rate by 50 bps on Wednesday, but ruled out the possibility of a 75 bps hike any time soon, telling FOMC members that “It wasn’t something the committee was actively considering.” His comments sparked a 3% rally in US stocks.

But all that disappeared when major US tech stocks fell in a brutal session for Nasdaq: Tesla down 8.3%, Apple down 5.6%, Amazon -7.6% and Meta -6.8% .

Bitcoin, which has been highly correlated to the Nasdaq, also tumbled 8% to trade at $36,475 by 8am ET. m. AEDT, its biggest drop since January.

Block Inc disappoints

Back home, the market awaits a statement from RBA Governor Philip Lowe on monetary policy at 11am AEDT.

Lowe is expected to provide more context on his decision to hike rates by 0.25% last Tuesday, and also give the market some guidance on what lies ahead.

In the meantime, Block Inc (ASX:SQ2) disappointed the market with its quarterly earnings last night, as it reported a 22% decline in revenue to $3.96 billion for the March quarter.

Afterpay made a contribution to Block’s gross profit for the first time of US$92 million, for the months of February and March.

Block Inc’s share price plunged more than 10% after the launch, and it would be interesting to see how other ASX-listed BNPL shares would react today.

5 small-cap ASXs to watch today

Calidus Resources (ASX:CAI)
Calidus has poured the first gold at its 100% Warrawoona gold project located in the Pilbara. The project has now entered the ramp-up phase, with the elution circuit currently operational, paving the way for the first slurry from the leach circuit to be dumped next week.

Opthea Ltd (ASX:OPT)
Opthea announced that its clinical data was presented at the 2022 Annual Meeting of the Association for Research in Vision and Ophthalmology (ARVO). The company presented the potential utility of combination therapy with the parent drug OPT-302 to treat patients with PCV lesions.

Thor Mining (ASX:THR)
Electromagnetic survey has commenced on Nickel Gossan at Thor’s 100%-owned Ragged Range Project, located in the eastern Pilbara. A high-power fixed-loop electromagnetism (FLEM) land-based geophysical survey is underway, extending over the untested nickel gossan located in the western part of the holding. The survey is designed to detect conductive anomalies at depth that may indicate the presence of nickel sulphide mineralization.

Seafarms Group (ASX:SFG)
Seafarms announced that Mick McMahon will step down as CEO and Executive Chairman effective immediately. Ian Trahar will replace Mr. McMahon as Non-Executive Chairman and an announcement regarding the new CEO will be made in due course.

January Group (ASX:EGG)
January has announced the sale of two of its businesses, The Leading Edge and The Digital Edge, to further align the group’s portfolio of complementary brands and services around the world. The creative technology company has sold both businesses to market research company FitftyFive5 for a total of $1.35 million.

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