Investing.com - A slump in the Australian stock market is expected following a dip in all major US indices overnight. As of 9:45 am AEST on Thursday, ASX 200 Futures were down by 1.2%, as investors look ahead to Australian and Chinese trade balance figures set for release later in today's trade.
Among U.S. markets, the NASDAQ Composite shed 1.1% as NVIDIA Corporation (NASDAQ:NVDA) and Apple Inc (NASDAQ:AAPL) dipped over 3% each, while real estate, manufacturing, and financial sector also declined. The S&P 500 fell 0.7% and the Dow Jones Industrial Average suffered a 0.6% loss.
On the data front, the ISM service PMI revealed growth for the 8th consecutive month in a row, showing an increase in employment, prices, and new orders compared to the previous month.
Investors are increasingly worried that unless the economy shows signs of slowing down, inflation could rise rather than align with the Federal Reserve's target. The rise in rates could create more attractive alternatives to stocks while making borrowing more expensive for both households and businesses.
In the commodities market, Brent crude oil saw a 0.6% increase, reaching US$90.60 a barrel, while gold experienced a slight decrease, settling at US$1,918.06.
In the bond market, the yields on Australia 2-Year government bonds remained constant at 3.82%, and the 10-Year yield was also unchanged at 4.13%. US Treasury notes saw an increase, with the 2 Year yield at 5.02% and the 10 Year yield at 4.28%.
Among currencies, the Australian dollar appreciated slightly, closing at 63.85 US cents from its previous 63.80, while the US Dollar Index was at 104.9.
Asian markets presented a mixed picture. Chinese shares fluctuated as traders balanced expectations of further stimulus against ongoing economic slowdown fears. Shares of property developers and financial companies helped the Shanghai Composite Index recover from its initial losses, ending with a 0.1% gain at 3158.08. In contrast, shares in pharmaceutical companies and consumer brands weighed down the market. The Shenzhen Composite Index rose by 0.1%, while the tech-centric ChiNext Price Index fell by 0.5%.
Hong Kong shares remained steady, with significant recovery from morning losses owing to a surge in mainland property stocks. The Hang Seng Index remained unchanged at 18449.98. The Hang Seng Mainland Properties Index enjoyed a 3.6% boost due to reports of possible new stimulus measures to support the property sector in Beijing.
Japanese stocks saw an uptick, driven by gains in the financial sector following an increase in US Treasury yields. The Nikkei 225 rose by 0.6% to 33241.02. Investors are now focusing on the US services sector activity data and the Federal Reserve's Beige Book for further policy implications.