ASX 200 futures point to a weaker open, down 32 points (-0.35%) at 8:30 am AEDT.
The benchmark shed 86 points (-0.96%) to 8,926 on Wednesday as a hotter-than-expected Q3 CPI print erased hopes of an RBA cut next week. Headline inflation rose 1.3% q/q, pushing annual CPI to 3.2% y/y from 2.1%, while trimmed mean climbed 1.0% q/q (above 0.8% estimates and the RBA’s August 0.6% forecast), lifting the core rate to 3.0% y/y—its first uptick since December 2022.
Rate markets pushed the expected timing of the next 25 bp cut from February 2026 to May 2026, leaving rate-sensitives exposed: Westpac -3.06% to $38.29, NAB -2.64% to $43.44, CBA -2.08% to $170.40, ANZ -0.40% to $36.95.
“Today’s numbers are so bad they also place the prospect of a February rate cut in even greater doubt,” Betashares chief economist David Bassanese said. “Perhaps the most disappointing aspect of today’s report was the still sticky level of service sector inflation.”
Sector moves: Health Care (-2.31%), Industrials (-1.97%), Financials (-1.87%) lagged; Materials (+1.15%), Energy (+0.52%), Utilities (+0.42%) outperformed.
Microsoft and Meta miss, but Alphabet rises
Wall Street set fresh intraday records, though the S&P 500 and Dow faded to close flat to lower after a hawkish 25 bp Fed cut to a 3.75%–4.00% target range sparked a swift repricing in rates.
Chair Powell cautioned there’s “no risk-free path,” and said a December move isn’t guaranteed, lifting Treasury yields 8–11 bp and trimming odds of another 25 bp cut to ~70% from near-certainty. After the bell, mega-cap tech earnings were mixed.
- Alphabet (Google): Earned $2.87 per share versus $2.27 expected and posted $102.3 billion in revenue. Shares rose about 5% after hours. It was Alphabet’s first-ever quarter above $100 billion in revenue, helped by a 12% jump in advertising and a 35 percent rise in Google Cloud to $15.16 billion.
- Meta: Reported $1.05 per share versus a $6.75 Wall Street estimate, mainly because of a one-time tax charge of $15.93 billion. Revenue was $51.24 billion. Shares fell about 9% after hours.
- Microsoft: Beat expectations with $4.13 per share and $77.7 billion in revenue, but the stock slipped about 2% after hours on higher capital-spending guidance and a $2.1 billion write-down tied to OpenAI.
Europe’s mixed markets
European stocks were mixed, with the main index easing slightly after notching an intraday record. Cyclicals led: miners gained 1.8% and oil majors 1.3% as bullion, copper and crude advanced. Telecoms fell 2% after Telenor slid 6% on softer results.
The continent-wide FTSEurofirst 300 edged lower, while London’s FTSE 100 rose 0.6% to a record close, buoyed by resources and defensives. Attention now turns to tonight’s ECB decision, where traders will parse guidance on the pace and extent of any further policy easing amid sticky core inflation and a patchy growth backdrop. Corporate focus stays on earnings momentum and pricing power across sectors ahead of heavyweight US results that could sway European sentiment in the next session.
Currencies
The US dollar firmed in European and US trade.
- The euro fell from US$1.1664 to US$1.1578 and was around US$1.1590 at the US close.
- The Australian dollar slipped from US$0.6616 to US$0.6559, last near US$0.6565, reflecting the hawkish RBA repricing and stronger USD.
- USD/JPY pushed higher as the yen weakened from ¥151.85 to ¥153.00 per dollar, trading near ¥152.85 late in New York.
FX volatility remains sensitive to rate-path expectations into the ECB tonight, Friday’s US data run, and local updates on Australian trade prices next.
Commodities & Diary
Crude rose after US inventories fell by nearly 7 million barrels versus a ~0.2 million draw expected.
- Brent +0.8% to US$64.92/bbl; WTI +0.5% to US$60.48/bbl.
- Base metals were firmer, with copper up 1.8% to record highs on tightening mine supply and aluminium +0.3%.
- Gold futures settled +US$17.60 (+0.4%) at US$4,000.70/oz, while spot traded near US$3,938 late as Powell’s remarks tempered gains.
- Iron ore edged up US$0.10 (+0.1%) to US$105.66/t on optimism around US-China trade progress.
Looking ahead
- Australia posts international trade price indexes; Coles, IGO, Lynas Rare Earths and Mineral Resources issue quarterlies.
- Central banks: BOJ and ECB decisions due.
- US releases jobless claims and GDP. Earnings slate includes Apple, Amazon, Mastercard, Merck and Eli Lilly, plus Coinbase and MicroStrategy.