Market Highlights: Gold tops US$2,600; Uranium stocks in focus after Constellation-Microsoft nuclear deal

Gold is above US$2,600 for the first time and Constellation Energy has signed a deal with Microsoft to restart a nuclear reactor at Three Mile Island.

Constellation Energy soars after nuclear deal with Microsoft. Pic: Getty Images

• ASX set to pull back as interest rate concerns rise

• Intel shares jump after Qualcomm takeover talks

• Constellation Energy soars after nuclear deal with Microsoft

The ASX set to pull back from Friday’s record highs this morning as investors grow increasingly worried that the Reserve Bank might delay cutting rates until next year, even as other central banks make moves.

At 8am AEST, the SPI ASX200 futures contract was pointing down by 0.7%.

Last week, US shares soared to record levels, but that momentum faded away on Friday, with the S&P 500 ending the day down by 0.2%.

Meanwhile, the Dow Jones managed a slight gain of 0.1%, reaching a new closing high, while Nasdaq was 0.36% lower.

This week is a big week of data in Australia. First, all eyes will turn to the RBA's meeting on Tuesday, where it’s expected that the cash rate will remain steady at 4.35%.

Then on Wednesday, the monthly CPI figures will be released, with forecasts indicating a drop in annual headline inflation to 2.7% in August, down from 3.5% in July.

ANZ economists predict the RBA will maintain its current interest rates this month, with the board likely to weigh options between holding steady or increasing the cash rate.

The Commonwealth Bank, on the other hand, anticipates the RBA will cut the cash rate by 25 points before the end of this year, but says there’s a chance chance it could be delayed further to February 2025.

Turning to stocks news, Intel Corp jumped 3% following a report from The Wall Street Journal that semiconductor giant Qualcomm recently reached out to Intel regarding a potential takeover. Qualcomm’s stock dropped nearly 3%.

FedEx Corp plunged 15% after cutting its full-year guidance and announcing Q1 earnings that fell far short of Wall Street expectations.

Mercedes-Benz fell 7% in Frankfurt after lowering its full-year profit outlook for the second time in less than two months due to ongoing drops in sales in China, the world’s biggest car market.

And, Baltimore-based Constellation Energy surged 22% and hit all-time highs after the company revealed plans to restart a nuclear reactor at Three Mile Island in Pennsylvania and sell the power to Microsoft for its data centres.

Wall Street had been expecting Constellation to land a deal with a major tech player this year, as companies look for more energy to support their tech needs amid the AI boom.

Nuclear energy is fuelling the AI revolution

The announcement from Constellation Energy marks a pivotal moment in the nuclear industry.

Three Mile Island, the site of the worst nuclear disaster in the US, is making a historic comeback to supply electricity to Microsoft.

Constellation, which owns the Pennsylvania plant that had a partial meltdown in 1979, announced a 20-year power deal with the tech giant.

Constellation plans to invest US$1.6 billion to restart a reactor that was decommissioned five years ago but wasn’t damaged in the accident.

The company says it will have the reactor up and running by 2028, pending upgrades and regulatory approval, generating enough power for about 700,000 homes.

This revival reflects a strong resurgence in the nuclear industry, driven by the growing demand for electricity from EVs and data centres supporting the AI boom.

The nuclear industry’s reputation has taken a hit over the past decade, but with tech companies now seeing the benefits of reliable, clean energy in nuclear power, and government subsidies rolling in, the mood has shifted.

Amazon has also jumped in, purchasing a nuclear-powered data centre in Pennsylvania.

To other markets …

Gold price soared above US$2,600/ounce for the first time on Friday, driven by expectations of more US interest rate cuts and escalating tensions in the Middle East.

The spot bullion price is currently trading at US$2,620.35

Oil prices closed slightly lower but still managed to post gains for the second consecutive week, buoyed by a US interest rate cut and a decrease in US supply.

Brent crude is now trading at US$74.52 a barrel.

The benchmark 10-year US Treasury yield was 3 basis point higher (bond prices lower) to 3.74%.

The Aussie dollar was flat at US68.12 cents.

Bitcoin was up 0.65% in the past 24 hours to US$63,630, and Ethereum also inched up by 0.12% to US$2,579.

Meanwhile, iron ore retreated by 1% to $US91.55 a tonne.

5 ASX small caps to watch today

Anson Resources (ASX:ASN)
Anson has been granted 21 additional SITLA (a government agency in Utah responsible for managing state trust landblocks) for its Green River Lithium Project in Utah. This new land covers 6,685 acres and is expected to be rich in lithium brines, which are key for upcoming exploration programs. All the new blocks are within 8km of the recently drilled Bosydaba #1 well. The Utah government’s approval shows strong support for developing the Green River project, which the company says will enhance its land holdings next to its privately owned land and proposed processing plant.

Lunnon Metals (ASX:LM8)
Lunnon has reported exciting progress in gold exploration at the Lady Herial site in its Kambalda Gold & Nickel Project. The best result so far is of gold at 5.27 g/t, found just 18 metres below the surface. The company is defining a thick mineralised zone with multiple gold intercepts, and earlier drilling results support the potential for further discoveries. With ongoing positive assay results, Lunnon says Lady Herial is looking promising for establishing a small-modest sized zone of gold mineralisation, which could lead to open pit mining opportunities in the future.

IperionX Limited (ASX: IPX)
IperionX has signed a contract to supply metal components for Ford Motor Company. The contract will last for 45 months starting in 2025 and involves providing titanium metal powder and manufacturing components, with expected total revenues of around US$11 million. However, the actual revenue and timing depend on Ford’s annual volume estimates and delivery schedules, which may change, along with possible adjustments to component designs before production begins.

Austal (ASX:ASB)
Austal has announced that Austal USA has secured a US$152 million contract from the US Navy. This contract will help support the Navy's goal of producing one Columbia-class submarine and two Virginia-class submarines each year. The funding will allow Austal USA to invest in the United Submarine Alliance's Qualified Opportunity Fund, which aims to boost production capacity in the US submarine industry by enhancing infrastructure around Austal's facilities in Mobile. This contract is in addition to a separate US$450 million deal with General Dynamics Electric Boat.

Brightstar Resources (ASX:BTR)
BTR says further drill assays from the Jasper Hills Gold Project have shown promising results, including several high-grade intercepts such as 7 metres at 9.50 g/t Au from 176 metres, with a peak of 1 metre at 45.3 g/t Au from the Fish deposit. This drilling aimed to explore and extend gold mineralisation for a potential underground mine, while also assessing geotechnical conditions at the nearby Cork Tree Well deposit.

At Stockhead we tell it like it is. While Anson Resources and Brightstar Resources are Stockhead advertisers, they did not sponsor this article.

Originally published as Market Highlights: Gold tops US$2,600; Uranium stocks in focus after Constellation-Microsoft nuclear deal