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The local market ended last week on a 0.23% gain at the closing bell of Friday’s session, driven by a surge in energy and materials stocks on the back of rising commodity prices. Communication services and consumer discretionary stocks came under pressure to close in the red on the last trading session of the week.

Quarterly reports and company trading updates continued dominating market movements last week both locally and overseas and are expected to continue doing so for at least the next few weeks as investors respond to company performance amid challenging market conditions especially in this rising interest rate environment.

The winning stocks from Friday’s session were Pilbara Minerals rising 13% on the back of a strong trading update including a 10% increase in delivered spodumene concentrate on the prior quarter. Whitehaven Coal rallied over 6% on Friday and Fisher and Paykel Healthcare added 4.87% to end the week.

On the losing end, Liontown Resources tumbled over 8%, while Nanosonics fell 6.64% and Pinnacle Investment Management lost 3.76%.

The most traded stocks by Bell Direct clients on Friday were Whitehaven Coal, Rio Tinto and Terracom.

Over in the US on Friday, tech shares led the broad market rally as investors responded to some positive corporate news including Google’s parent company Alphabet cutting 12,000 staff to cut costs as growth in the business slows, which prompted a 5% surge in Alphabet’s share price. Netflix also surged on better-than-expect subscriber data announced in the company’s latest results update. The Nasdaq jumped 2.7%, the Dow Jones added 1% and the S&P500 rallied 1.9% on Friday.

Investors are keeping a close eye on any news around the Fed’s upcoming interest rate meeting from January 31 to February 1 where it is expected the Fed will ease its current aggressive stance on rate hikes to increase the nations’ cash rate by 25-basis points amid signs the economy is beginning to cool.

Markets in Europe rebounded from Thursday’s sell-off driven by weaker-than-expected retail sales out of the US, to close higher on Friday as investors in the region also keep a firm eye on updates out of the Fed ahead of the next policy meeting. Germany’s DAX added 0.76%, the French CAC rallied 0.63% and in the UK, the FTSE100 rose 0.3%.

What to watch today:

• Ahead of the local trading session, the SPI futures is anticipating the ASX to open 0.46% higher, buoyed by the strong session on Wall Street on Friday.
• On the economic data front today, the Bank of Japan policy meeting minutes will be released, which will give investors an insight into the rate outlook in the region following the shock maintenance of the country’s extremely low interest rate of -0.1% at the last policy meeting.
• Taking a look at commodities, oil is trading higher at US$81.64/barrel, gold is down almost 1% at US$1913/ounce and iron ore is flat at US$124.50/tonne.
• The Aussie Dollar is buying US$070, 90.25 Japanese Yen, 56.19 British Pence and NZ$1.08.

Trading Ideas:

• Bell Potter maintain a BUY rating on IVE Group (ASX:IGL), and while there is no change in forecasts, Bell Potter have updated each valuation used in the determination of our price target for market movements and time creep. The price target has increased from $2.60 to $2.75, and at IGL’s current share price of $2.37, this implies 16% share price growth in a year.
• Trading Central have identified a bullish signal in Pilbara Minerals (ASX:PLS) indicating that the stock price may rise from the close of $4.55 to the range of $4.80 to $4.90 over 26 days according to the standard principles of technical analysis.