Australian shares are on track for a modest rise at the open, with ASX 200 futures up 14 points (+0.15%) at 8:30 am AEST. The upbeat lead comes after US markets closed at record highs, as a cooler-than-expected US headline inflation reading kept alive hopes for a September rate cut from the Federal Reserve.
The S&P 500 broke through the 6,400 mark for the first time, the Nasdaq extended its record run, and the Russell 2000 small-cap index surged nearly 3% for its best day since May. Traders now see a roughly 93% chance of the US Federal Reserve trimming rates next month, up from 85% before the CPI release.
The upbeat lead from Wall Street follows the Reserve Bank of Australia’s decision yesterday to cut the cash rate by 25 basis points to 3.6% — its third reduction this cycle — as it flagged slower near-term growth and left the door open for more easing.
In Australia today, investors will be digesting a flood of earnings reports from market heavyweights, alongside the June-quarter wage price index at 11:30 am AEST, with analysts expecting a 0.8% increase.
Wall Street jumps on in-line inflation
All three major US benchmarks closed near their highs of the session — the S&P 500 up 1.13% to 6,446, the Nasdaq Composite gaining 1.39% to 21,682, and the Dow Jones Industrial Average rising 1.1% to 44,459. Gains were broad-based, with tech, communications and financials leading the charge.
July CPI rose 0.2% month-on-month, matching forecasts, while the annual rate remained at 2.7%. Core CPI picked up to 3.1% from 2.9%, but a muted rise in goods prices helped soothe tariff-related concerns, and analysts said the reading added further support for a September rate cut. Bond yields eased at the short end, the US dollar weakened, and cyclical sectors rallied.
ASX marks another record as reporting continues
The S&P/ASX 200 added 36 points (+0.41%) on Tuesday to close at 8,880.8 — its second consecutive record finish.
Gains in financials, consumer discretionary and utilities offset declines in industrials and IT. Materials rose 0.37% as lithium prices edged higher in China, though most local lithium stocks eased after Monday’s sharp rally.
The reporting season spotlight today falls on the banking, insurance and tech sectors. Commonwealth Bank posted FY25 cash NPAT of $10.25 billion, up 4% — broadly in line with expectations. Insurance Australia reported $1.17 billion in cash earnings for FY25, slightly lower than estimates, while Computershare delivered a 14% lift in its final dividend to 48 cents, with FY25 earnings per share at $1.35 and FY26 guidance also meeting consensus.
Other results are due from AGL Energy, Evolution Mining, Arena REIT and Treasury Wine Estates.
Commodities and currencies
Commodity markets were mixed, with industrial metals finding support while oil retreated. The Australian dollar firmed slightly against the greenback.
- Gold: US$3,351.22 (+0.25%).
- Copper: US$4.4973/lb (+1.33%).
- WTI crude: US$63.08 (-1.42%); Brent: US$66.12 (-0.78%).
- Iron ore: US$102.41 (+0.44%).
- AUD/USD: 0.653 (+0.04%).
- Bitcoin: US$119,788 (+0.96%).
Global backdrop
European markets were subdued, with the Euro Stoxx 50 up 0.08% and the UK FTSE 100 gaining 0.20%. Energy stocks led the advance, while Germany’s DAX slipped 0.23%. In Asia, Japan’s Nikkei jumped 2.15% as tech stocks tracked Wall Street higher, and Chinese equities advanced 0.5% on optimism around trade and stimulus.
What’s ahead today
Locally, the June-quarter wage price index is expected to show a 0.8% quarterly rise and 3.3% annual growth, alongside housing finance approvals data, while reporting season remains in full swing.
Offshore, the market will digest the implications of US CPI and watch for further central bank commentary as Fed cut expectations approach certainty for September.