Australian shares are tipped to open lower today, with mixed messages coming from global markets overnight.
Gold and copper prices are riding at all-time highs on the back of renewed US rate-cut optimism.
Tech drives Nasdaq high
Overnight on Wall Street tech stocks drove the Nasdaq to a record high, while the other two major indices flailed.
The S&P 500 moved only modestly into the green, up 0.1% and the Dow Jones fell by 197 points or 0.5%, weighed down by JPMorgan Chase (NYSE:JPM)'s 4.5% drop after CEO Jamie Dimon hinted at retirement.
Chipmaker Nvidia rallied 2.5% following a positive analyst forecast, while Micron Technology (NASDAQ:MU) climbed 3% after an upgrade from Morgan Stanley (NYSE:NYSE:MS).
Microsoft (NASDAQ:MSFT) was up 1.2% ahead of its Build developer conference and the Philadelphia SE semiconductor index increased by 2.2%.
European share markets closed higher, with the FTSEurofirst 300 index up 0.2%.
The aerospace and defence sector led gains amid heightened Middle East tensions following the death of Iranian President Ebrahim Raisi.
Gold shines
Miners benefited from surging copper prices, driven by China’s property support measures, with the sector rising 0.7%.
Gold prices also hit new highs. The UK FTSE 100 index edged up 0.1% after Bank of England deputy governor Ben Broadbent suggested potential interest rate cuts.
Gold futures rose 0.9% to US$2,438.50 an ounce, while spot gold traded near US$2,424 an ounce.
Copper futures climbed 0.6% amid speculative trading.
Aluminium futures increased by 0.9%. Iron ore futures rose 0.2% to US$117.24 a tonne, boosted by China’s real estate sector support.
Currencies and crude
Currencies weakened against the US dollar. The Euro fell to US$1.0855, the Australian dollar slid to 66.65 US cents and the Japanese yen dipped to JPY156.30 per US dollar.
US government bond yields increased, with the 10-year Treasury yield rising to 4.45% and the two-year yield to 4.85%.
Fed vice chair Phillip Jefferson expressed cautious optimism regarding the central bank's ability to manage inflation while fostering economic growth.
Global oil prices eased as Federal Reserve officials awaited more definitive signs of declining inflation before considering interest rate cuts.
Brent crude fell by 0.3% to US$83.71 a barrel and the US Nymex crude price dipped by 0.3% to US$79.80 a barrel.
Bitcoin was trading at $69,250 (+4.49%) after trading above $70,000 for the first time in five weeks.
“Last week's break above the downtrend resistance at $63,500 strongly indicated that the correction was complete and that the uptrend had resumed,” said IG analyst Tony Sycamore.
“We continue to expect a retest and break of the March $73,794 high before a move towards $80,000.”
What’s next?
In Australia, consumer confidence surveys and the minutes from the May monetary policy meeting of the Reserve Bank (RBA) Board are scheduled for release.
“The minutes will be closely scrutinised to determine what options the RBA Board considered at its May meeting and any clues behind the RBA's less hawkish-than-expected tone,” wrote Tony Sycamore in his morning briefing.
“Ahead of the minutes, the rates market is pricing a 44% chance of a 25bp RBA rate cut in December.”
Earnings reports from ALS, Infratil, James Hardie, and Technology One are also expected.
BrainChip and Viva Energy will host Annual General Meetings, and Amcor will trade ex-dividend.
In the US, investors await earnings releases from AutoZone (NYSE:AZO), Macy's (NYSE:M), XPeng, Toll Brothers and Urban Outfitters (NASDAQ:URBN).