Local shares due for a modest rise on fresh hopes the US will keep interest rates on hold today.
Market Highlights: ASX set to rise modestly, while US CPI data adds weight to rate hike pause by the Fed
News
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- ASX set for a modest gain at market open this morning
- Wall Street banked modest gains on better than expected May CPI data
- Oil rebounds 3.0% after China cuts short-term loan rates to keep its economy moving
Aussie shares are set to open slightly higher this morning, after Wall Street edged higher overnight while US investors brace for the next move by the US Fed this week.
The major US indices banked modest gains for the session, with the Dow adding 0.43%, the S&P climbing 0.69%, and the tech-heavy Nasdaq outperforming once again on +0.83%, bringing the latter two up to fresh one-year highs.
All eyes are on the remaining day of the FOMC meeting to see which way the Fed will jump on interest rates.
However, fresh data showing that US consumer prices barely moved the needle in May – the annual increase in inflation was the smallest in more than two years – are providing solid support for the view that the Fed will likely leave interest rates unchanged.
US CPI climbed 4.0% for the year to May, the smallest year-on-year increase since March 2021, following a 4.9% rise in April.
US SHARES
Among the big movers on Wall Street were EV maker Rivian Automotive (+8.9%), and Nvidia (+3.9%), while Norwegian Cruise Lines added another 5.7% to their highest price since May 2022 after Bank of America raised its price target to $19 from $17.
OTHER MARKETS
Oil prices bounced back from yesterday’s steep drop-offs, adding 3.0% on news that China’s central bank lowered a short-term lending rate for the first time in 10 months, in a bid to add momentum to the country’s post-pandemic economy.
China is the world’s largest crude oil importer, and the stimulus-driven rate cut is expected to increase demand.
Oil prices also gained some support from news that the US plans to buy back at least 12 million barrels of oil for the Strategic Petroleum Reserve this year.
Gold prices slipped due to a rebound for US Treasury yields, as investors moved further behind the bet that the US Fed won’t change rates today.
US gold futures settled 0.6% lower at $1,958.60 an ounce.
SHARES TO WATCH TODAY
Nickelsearch announced that it has intersected visual nickel sulphides in the first of three diamond holes at two targets at its Carlingup nickel sulphide project in WA.
“This is an early win for us. We will continue the hole to its planned target because our earlier RC drilling suggests the presence of thicker sulphide mineralisation down-plunge,” Nickelsearch MD Nicole Duncan said yesterday.
News of IPX signing a major deal with US automaker Ford to supply titanium metal components using its 100% recycled low-carbon titanium metal has sparked investor interest.
The company has been collaborating to design, test and additively manufacture a series of high-quality titanium components for future production vehicles for Ford’s high-performance and racing division, Ford Performance.
Golden Mile Resources (ASX:G88)
Rumblings about continued success for Golden Mile at its Quicksilver nickel-cobalt deposit have placed G88 in the box seat this morning, with freshly-installed managing director Damon Dormer at the helm to oversee the company into the next phase of its development.
