Australian shares set to track gains on Wall Street
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The news: The Australian sharemarket is set to rise in early trading, tracking solid gains on Wall Street as fresh data supported prospects for US interest rate cuts later this year.
The numbers: The Dow Jones index ended 0.25% higher while the broader S&P 500 rose 1.18% and the tech-heavy Nasdaq added 1.96%. In the local market, ASX 200 futures were up 42 points or 0.54% at 7,825 points at 7:00am AEST on Thursday.
The context: Both the S&P 500 and Nasdaq indexes hit fresh record closing highs overnight, powered by technology stocks even as markets digested economic data that could support a much-expected start to the US Federal Reserve's policy easing cycle.
The May private payrolls report showed hiring slowed to a four-month low in May, the latest data to suggest an easing in labour market tightness that could prompt the Fed to begin cutting rates this year. Those hopes were bolstered after the Bank of Canada became the first major central bank to cut its key interest rate.
US 10-year Treasury yields fell to a two-month low ahead of Friday's highly anticipated government employment report for May. Traders now see a nearly 69% chance of a September rate reduction, according to the CME's FedWatch tool, compared to around 50% last week.
The source: Reuters
