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ASX today – The ASX is set for a stronger open on Friday, with 200 futures pointing to a gain of around 0.6% after Wall Street rebounded despite the US Federal Reserve delivering its first rate hike in three years.
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The ASX 200 closed 0.4% higher at 8,732 points last evening but the overnight move in US markets points to a more meaningful bounce at the open. The S&P 500 rose 1.1%, the Dow added 0.6% and the Nasdaq jumped 1.7%.
The backdrop is unusual. The Fed lifted its benchmark rate by 25 basis points to 3.75 to 4.00% and signalled that further tightening could be required, with 16 of its 18 policymakers projecting at least one more hike before the end of 2026.
Markets initially reacted negatively, but the focus shifted towards easing oil prices and lower longer-dated Treasury yields. That helped take some pressure off the inflation and interest-rate outlook that has weighed on equities.
Oil remains above US$100 a barrel, but Brent fell around 1% to US$104.90 as traders took some comfort from additional Saudi crude supplies and efforts to restore damaged pipeline capacity. Saudi Arabia revealed it expects to return about half of the capacity of its damaged East-West pipeline with days.
The physical market remains tight, however, with Middle East infrastructure and shipping still exposed to further disruption.
For Australian investors, that leaves the early session tilted towards a rebound in growth and technology stocks following the Nasdaq’s strong performance, while energy stocks remain closely tied to developments in crude markets.
The bigger domestic focus comes at 9:30am AEST, when RBA Governor Michele Bullock, Deputy Governor Andrew Hauser and senior RBA officials appear before the House Economics Committee in Canberra.
The appearance comes after Australian markets moved to price in a much higher probability of an RBA rate hike at the central bank’s September 29 meeting. Bullock’s comments on inflation, demand and the impact of higher global rates will therefore be closely watched for clues about the domestic rate outlook.
The question for the ASX today is whether the overnight rebound can hold once Australian investors return to the market — particularly with the RBA discussion, bond yields, the Australian dollar and oil all capable of shifting the tone.
For now, the market has chosen to look past the Fed’s hawkish message. Whether that continues through Friday is the more interesting question.
Local market news
Macmahon Holdings (ASX: MAH) to acquire Aspect Engineering Solutions;
Finbar Group (ASX: FRI) has commenced construction at the $192M Romeo development;
Daly Resources (ASX: DLY) has expanded the Huckitta fluorite target area;
Neu Horizon Uranium (ASX: NHU) has completed its exploration program on its Swedish uranium portfolio; and
Tesoro Gold (ASX: TSO) has unveiled a maiden 1.82Moz ore reserve at Ternera.
Buck and ore
Now – in forex, the Oz dollar is buying US$0.710
Looking at commodities, all in the greenback,
Iron Ore was up 0.01% to $97.42 per tonne in Singapore today,
Brent Crude was down 1.64% to $104.090 per barrel,
Gold was selling at $4341.39,
US natgas futures were down 0.70% to $2.8708 per gigajoule.
That’s HotCopper’s Market Open, I’m Colin Sandell-Hay – happy trading.
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