Australian shares set to track modest gains on Wall Street
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The news: The Australian sharemarket is set to open higher, tracking modest gains on Wall Street where investors await fresh inflation data to assess the outlook for rate cuts.
The numbers: The Dow Jones index and the broader S&P 500 both ended 0.09% higher, while the tech-heavy Nasdaq rose 0.30%. In the local market, ASX 200 futures were up 26 points or 0.34% to 7,775 points at 7:00am AEST on Friday.
The context: US stocks edged higher after latest data indicated a continued slowdown in economic activity, raising investors' hope for rate cuts.
Data showed new orders for key US-manufactured capital goods unexpectedly fell in May, while core durable goods orders fell 0.1% versus forecasts for a 0.2% rise, boosting investor beliefs that a weaker economy could prompt the Federal Reserve to cut interest rates in September. Also, weekly jobless claims fell to 233,000, missing expectations.
Traders are now awaiting the release of the monthly personal consumption expenditures price index — the Federal Reserve's preferred inflation gauge — later on Friday. Investors have largely stuck to their view of around two rate cuts this year, even though the Fed has projected only one, with a 59.5% chance of a first cut in September.
The source: Reuters
