Australian equities are expected to gain on Thursday, after Wall Street bounced back after US central bank minutes left investors hoping to avoid a recession and higher-than-expected rate hikes could face to inflation.
Key points:
- ASX futures point to a gain on the main index on Thursday
- US equities rose on Thursday, while the yield on the 10-year U.S. Treasury bill varied little.
- U.S. Federal Reserve minutes in May suggest rates could rise faster than expected
ASX futures rose 0.2 percent to 7,156 at 7:10 a.m. AEST and the Australian dollar gained 0.3 percent to 70.87 US cents.
Meanwhile, in the United States, the minutes of the May 3-4 meeting of the Federal Open Market Committee (FOMC) revealed that members saw the need to raise rates faster than the market expected to slow down. inflation.
The meeting resulted in a 50 basis point rate hike, which was the biggest jump in 22 years.
The FOMC said such rate hikes “would probably be appropriate” at its next June and July meetings.
Overnight, the yield on the 10-year U.S. Treasury note stagnated, at about 2.75 percent, while shares gained after the release of the FOMC minutes.
Investors are less concerned about higher rates than the possibility of a recession, as US inflation is in its 40s.
“Uniformity of opinion is a good thing,” said Ross Mayfield, an investment strategy analyst at Baird.
“There is a lack of uncertainty about what to do in the short term.
“At the time [the Fed] by September, they will have a lot of financial data to make their way from here, “Mayfield added.
The S&P 500 was up 0.9% to 3,978, while the Nasdaq Composite was up 1.5% to 11,434. The Dow Jones Industrial Average gained 0.6% to 32,120.
Nine of the top 11 sectors of the S&P 500 rose, with discretionary consumer stocks leading the pack with a 2.8 percent gain.
Amazon.com and Tesla were up 2.6 percent and 4.9 percent, respectively.
Department store operator Nordstrom rose 14 percent after its optimistic annual earnings and revenue forecasts.
Wendy’s Co. fast food chain rose 9.8 percent after a regulatory filing revealed that shareholder Nelson Peltz was considering a possible takeover bid for the company.
Shares of Nvidia Corp fell more than 8 percent in out-of-hours operations after the company’s second-quarter revenue forecast had not been expected.
Cash gold fell 0.7% to $ 1.85.20 an ounce.
In the oil markets, Brent crude rose 0.6% to $ 114.29 per barrel, while West Texas crude rose 0.8% to $ 110.71 a barrel. .
In Europe, the pan-European STOXX 600 index rose 0.6%, while Germany’s DAX rose 0.6% and the British FTSE rose half a percent.