Australian shares to start higher after Wall Street gains
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The news: The Australian sharemarket is poised to open higher after strong gains on Wall Street on the back of a rally in chip stocks and signals from the Federal Reserve that it is close to cutting rates.
The numbers: The Dow Jones index ended 0.24% higher, while the broader S&P 500 rose 1.58% and the tech-heavy Nasdaq climbed 2.64%.
In the local market, ASX 200 futures were up 17 points or 0.21% to 8,078 points at 7:00am AEST on Thursday.
The context: The major US indices ended higher after the Federal Reserve kept its benchmark interest rate in the 5.25% to 5.50% range after a two-day policymaking meeting, but opened the door to easing in September.
During his press conference, Fed Chair Jerome Powell said policymakers discussed the case for cutting rates, but a "strong majority" agreed that now was not the appropriate time.
Latest data showed July US private payrolls increased far less than expected, indicating an easing in persistent labour market tightness.
Meanwhile, Nvidia jumped, helped by a rosy 2024 sales forecast for artificial intelligence chips by peer Advanced Micro Devices, whose shares also gained, while Meta rose ahead of its results.
What they said: "The statement didn't move the needle at all," Mark Malek, chief investment officer at Siebert Next told Reuters in New York, referring to the Fed's official statement. "But listening to him speak, it's clear they're all locked and loaded for September rate cut and they're going to maintain their optionality."
The source: Reuters
