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The morning catch up: ASX to drop as US sharemarkets rise ahead of Federal Reserve decision

Published 11/06/2024, 09:45 am
Updated 11/06/2024, 10:00 am
© Reuters.  The morning catch up: ASX to drop as US sharemarkets rise ahead of Federal Reserve decision
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Despite the S&P 500 and Nasdaq closing at record highs, the ASX 200 will open lower following a trading day off.

ASX 200 futures are trading 33 points lower, down -0.42% as of 8:30 am AEST.

What happened while ASX rested?

(source Commsec)

US sharemarkets

Rose on Monday, driven by investor positioning for the upcoming US Federal Reserve policy decision and key inflation data due on Wednesday.

Nvidia's shares increased by 0.8% following a 10-for-one stock split, sparking discussions about its potential inclusion in the Dow Jones Industrial Average.

Meta Platforms saw a 2% rally and Southwest Airlines (NYSE:LUV) surged 7% after Elliott Investment Management disclosed a US$1.9 billion stake. Conversely, Apple (NASDAQ:AAPL) fell 1.9% after announcing new AI features including tools supported by OpenAI’s ChatGPT.

  • The Dow Jones index rose 69 points (0.2%).
  • The S&P 500 gained 0.3%.
  • The Nasdaq added 59 points (0.4%), with both closing at fresh record highs.

European sharemarkets

Fell, impacted by French stocks after President Macron called a snap election post-European Union parliamentary elections. The CAC 40 dropped 1.4% to a three-month low, with significant declines in banks like BNP Paribas (EPA:BNPP), Societe Generale (EPA:SOGN) and Credit Agricole (EPA:CAGR).

Economic data

In economic data, US consumer inflation expectations for the year ahead decreased to 3.17% in May from 3.26% in April.

US government bond yields rose, with the 10-year Treasury yield increasing to 4.47% and the 2-year yield to 4.88%.

Commodities

Global oil prices climbed nearly 3%, with Brent crude rising to US$81.63 per barrel and US Nymex crude to US$77.74 per barrel.

Base metal prices were mixed; copper futures increased by 1.4%, while aluminium futures declined by 0.3%.

Gold futures rose by US$2, or 0.1%, to US$2,327 per ounce on Monday, as investors anticipated the release of US inflation data and the Federal Reserve's upcoming interest rate decision. Meanwhile, spot gold traded near US$2,310 per ounce by the close of the US markets.

Iron ore futures experienced a slight decline, falling by US$1.10, or 1%, to US$107.38 per tonne in Monday's trading. The market activity was subdued due to the closure of Chinese markets for the Dragon Boat Festival holiday.

Looking at small caps

The S&P/ASX Small Ordinaries (XSO) finished June 7 0.14% higher to 3,019.60. For the five days last week, it was down 0.11%.

It has been a busy morning on the news front as companies make up for yesterday’s non-trading day.

You can read about the following and more throughout the day.

  • Yandal Resources Ltd (ASX:YRL) has completed the preliminary interpretation of recently acquired ground gravity data from the Ironstone Well-Barwidgee (IWB) Gold project.
  • Anson Resources Ltd (ASX:ASN, OTCQB:ANSNF) has pegged a strategic tenement that abuts its Ajana Project in the Mid-West region of Western Australia, increasing the size of project by 175%.
  • Riversgold Ltd (ASX:RGL) reported that a review of data for the Tambourah Project, 160 kilometres southeast of Port Hedland in Western Australia, has identified historical copper exploration.
  • Eclipse Metals Ltd (ASX:EPM) announced a significant development in its Ivigtût multi-commodity REE Project in southwestern Greenland. The company has been granted access to 1940s-era archived historical diamond drill core, which has demonstrated high-grade rare earth element (REE) results from initial core samples, as released in November 2021.
  • Race Oncology Ltd (ASX:RAC, OTC:RAONF) announced that the United States Food and Drug Administration (FDA) has extended Orphan Drug Designation (ODD) to Race’s proprietary formulation of bisantrene, RC220.
  • Read more on Proactive Investors AU

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