6 things Australian traders will be talking about this morning

U.S. Federal Reserve Chairman Jerome Powell. (Photo by Alex Wong/Getty Images)

Good morning.

To the scoreboard:

Dow: 23,924.98 -174.07 (-0.72%)

S&P 500 2,635.67 -19.13 (-0.72%)

AUD/USD: 0.7494 +0.0004 (+0.05%)

ASX 200 SPI futures (June contracts): 6,050 (+4)

  1. The US Fed left the benchmark interest rate unchanged at its policy meeting, in a widely-expected move. Federal Reserve Open Market Committee officials said that inflation was near their 2% target.
  2. The Fed’s more direct commentary about rising inflation drove another move higher in the USD after it started last night’s session on the back foot. So the Aussie reversed course and has fallen back below US75 cents this morning.
  3. The US also had some more positive data overnight, as ADP payrolls beat expectations ahead of Friday night’s monthly employment report. US bond yields are holding steady, with benchmark 10-year yields little-changed at 2.97%.
  4. But US stocks were sold off into the close and the Dow finished more than 150 points lower, as the Fed remains on track to keep hiking rates while earnings results overnight were underwhelming. That hasn’t phased ASX futures traders though, who have marked the local index up slightly after it reached a two-month high yesterday.
  5. Trade talks between the US and China are about to commence. Chinese President Xi’s economic adviser will meet with members of the Trump administration in Beijing today and Friday – but some are sceptical that any meaningful negotiations will be reached.
  6. Iron ore goes on the charge: Spot prices snapped a five-session losing streak to close 2.4% higher last night, and futures markets are pointing to more gains to come. Oil had a choppy session, as benchmark crude bounced off its lows to close at $US73.36 a barrel.

Here’s today’s economic calendar:

  • Australian international trade data – March (11:30am AEDT)
  • Australian building approvals – March (11:30am AEDT)
  • Ai Group services PMIs
  • Eurozone inflation data
  • Japan is on holidays for Constitution Day

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