Australian shares set to rise after Wall Street gains
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The news: The Australian sharemarket is set to start the new week higher, taking the cue from a strong close on Wall Street on Friday after inflation data there matched expectations.
The numbers: The Dow Jones index ended 1.51% higher for its biggest daily percentage gain since November 2023. The broader S&P 500 gained 0.80% while the tech-heavy Nasdaq edged 0.01% lower. In the local market, ASX 200 futures were up 38 points or 0.49% at 7,757 points at 7:00am AEST on Monday.
The context: Month-end repositioning helped drive a late sharp rally for US stocks after key inflation data matched market expectations.
The US personal consumption expenditures price index increased 0.3% in April, matching the gain in March, with signs showing consumer spending slowed more than expected.
Traders of futures tied to the Fed policy rate added to bets of roughly even odds that the central bank will begin to cut rates in September and boosted the chances of a second rate cut in December to about the same probability.
Investors will be focused this week on the European Central Bank and the Bank of Canada, with both widely expected to announce the first rate cut by major central banks.
In the local market too, traders will be focused on the Fair Work Commission’s annual wage review decision later on Monday and the March quarter GDP update on Wednesday.
The source: Reuters
