Investing.com - The Australian stock market is projected to start strong on Tuesday, following the uptrend on Wall Street as traders await the US Federal Reserve's decision on interest rates this week.
Tesla Inc (NASDAQ:TSLA) saw a significant boost, soaring by 15.3%. This follows the electric vehicle manufacturer's steps towards obtaining regulatory approval to introduce its advanced driver-assistance program in China, its second-largest market after the United States.
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Apple Inc (NASDAQ:AAPL) also experienced a 2.5% rise, following reports of renewed negotiations with start-up OpenAI about the potential use of the latter's generative artificial intelligence technology.
The Federal Reserve's interest rate decision this week is of significant interest to investors. Current market expectations suggest a mere 36 basis points reduction in interest rates this year, a considerable decrease from the 150 basis points anticipated at the beginning of the year.
For Australian investors, attention is on the retail sales data for March, scheduled for release by the Australian Bureau of Statistics at 11.30 am AEST. The consensus predicts a 0.2% increase, following February's 0.3% rise.
RBA officials are betting on continued modest consumer demand to guide inflation back on track. A higher than expected consumer price index last week led economists to delay the predicted timing of the first rate cut. The market now strongly believes that the central bank's next move will be a rate increase rather than a decrease.
Also due for release at 11.30 am are private sector credit data, alongside a report on China's manufacturing Purchasing Managers' Index (PMI).
Ahead of the US Federal Reserve meeting, US government bond yields have seen a retreat from last week's highs. The 10-year Treasury yield dropped by 6 basis points to 4.61%, while the 2-year return marginally dipped 2 basis points to 4.98%. The US Treasury announced on Monday that borrowing estimates for the second quarter have increased to $IS243 billion, a significant rise from the $202 billion projected in January.