Australian shares to edge up after Wall Street ends higher

The news: The Australian sharemarket is poised to edge higher in early trade after major indices on Wall Street ended higher ahead of the US Federal Reserve’s rates decision meeting later this week.

The numbers: The Dow Jones index ended 0.38% higher, while the broader S&P 500 gained 0.32% and the tech-heavy Nasdaq added 0.35%. In the local market, ASX 200 futures were up 12 points or 0.16% to 7671 points at 7:00am AEST on Tuesday.

The context: US stocks ended higher, led by sharp gains for Tesla and Apple, but investors are looking toward what the Federal Reserve will say about the interest rate outlook after its policy meeting this week.

Traders expected the Fed to keep rates unchanged while striking a hawkish tone. Money markets are pricing in about 35 basis points (bps) of interest rate cuts this year, down from about 150 bps seen at the beginning of the year.