Australian shares to start higher after fresh records on Wall Street

The news: The Australian sharemarket is set to track gains on Wall Street where two of the three main indices closed at record highs following softer-than-expected inflation data.

The numbers: The Dow Jones index edged 0.09% lower, but the broader S&P 500 as well as the tech-heavy Nasdaq again finished at fresh record highs, adding 0.85% and 1.53% respectively. In the local market, ASX 200 futures were up 52 points or 0.67% at 7,782 points at 7:30am AEST on Thursday.

The context: US stocks opened higher after data showed the Consumer Price Index was unchanged in May mainly due to cheaper gasoline, but stocks turned choppy after the US central bank's “hawkish” statement that left its policy rate unchanged but also trimmed expectations from three rate cuts this year to just one.

The US dollar and US Treasury yields remained lower while traders of rate futures continued to price in the possibility that the Fed's rate-cutting cycle could start in September, and a second reduction was still seen as probable by the end of the year.