ASX 200 to rise as US stocks jump on Powell’s remark; NAB earnings today

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Highlights

  • The Australian share market is expected to rebound on Thursday.

  • According to the latest SPI futures, the ASX 200 is likely to open 38 points or 0.5% higher.

  • On Wall Street, the Dow Jones rose 2.8%, the S&P 500 climbed 3% and the NASDAQ ended 3.2% higher.


The Australian share market is expected to rebound on Thursday following a robust overnight closing on Wall Street after US Federal Reserve raised interest rates by 50 basis points (bp). It was the biggest hike by Fed since 2000. The US central bank also said that it was not "actively" considering the 75-basis point rate hike.

According to the latest SPI futures, the ASX 200 is likely to open 38 points or 0.5% higher. On Wednesday, the benchmark index fell 0.15% to 7,304.7 points.

Meanwhile, National Australia Bank Ltd (ASX:NAB) is among the ASX-listed firms slated to announce their earnings today.

Other than setting aside a potential 75 bp rise, Chairman Jerome Powell signalled the Fed is looking at 50 bp rises in June and July and the shifting to 25 bp thereafter.

On Wall Street, the Dow Jones rose 2.8%, the S&P 500 climbed 3% and the NASDAQ ended 3.2% higher.

In Europe, the Stoxx 50 fell 1%, the FTSE fell 0.9%, the CAC dipped 1.2%, and the DAX ended 0.5% lower.

Bond yields

  • 2-year yield: US 2.64%, Australia 2.85% (US prices as of 4.25 PM in New York)
  • 5-year yield: US 2.91%, Australia 3.30%
  • 10-year yield: US 2.93%, Australia 3.54%, Germany 0.97%

The dollar index fell 0.86% and the euro rose 0.89% to US$1.0614. The Aussie dollar gained as much as 1.3%, and local shares fell, after the Australian central bank's bigger-than-expected 25 basis-point rate increase on Tuesday.

Overnight in Asia, many Chinese and Japanese stock markets were closed.

The Bank of England is expected to lift British rates on Thursday by a quarter of a percentage point, which would be its fourth hike in a row to quell surging prices.

Oil prices rise

Oil prices rose about 5% on European Union’s plans to phase out imports of Russian oil, offsetting demand worries in top importer China.

  • WTI futures rose US$5.40 to settle at US$107.81 a barrel.
  • Brent ended up US$5.17 at US$110.14.

Gold prices bounce

Gold prices pushed higher overnight after Powell flagged risks to the economy from soaring inflation.

  • US gold futures settled down 0.1% at US$1,868.8 an ounce.

Bitcoin rose 5.68% to US$39,871.90 after earlier trading lower.

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