Australian share futures were pointing to a flat start after the US Federal Reserve kept rates unchanged, with Wall Street benchmarks turning positive late.
The ASX edged lower on Wednesday, while the Australian dollar was buying US70.35¢ at 9.13am AEDT.
The Fed held its policy rate at 3.50%–3.75%, but the decision was not unanimous. Governors Stephen Miran and Chris Waller dissented, each pushing for a 25 basis point cut.
Evercore ISI’s Krishna Guha said the statement upgraded the Fed’s growth assessment from “moderate” to “solid”, suggesting activity lifted into late 2025 and leaving the central bank comfortable staying on hold while it watches labour conditions and inflation risks tied to tariffs and fiscal stimulus.
Aussie eyes are now focused on the Reserve Bank of Australia (RBA)'s rate decision next week, which, after higher-than-expected inflation figures, is expected to stress mortgage holders.
Wall Street mixed: S&P 500 clips 7,000 as semis surge
US markets finished mixed.
The Dow rose 12 points (less than 0.1%), the S&P 500 slipped marginally after briefly topping 7,000 for the first time, and the Nasdaq gained 40 points (0.2%).
Fed chair Jerome Powell reinforced a data-driven stance, saying policy is not “on a preset course” and decisions will be made meeting by meeting.
A tech-led move powered late gains, helped by upbeat outlooks and strong sector signals. Seagate Technology jumped 19.1% on guidance, while Western Digital rose 10.7%. Chip stocks rallied after SK Hynix reported a record quarterly profit and ASML logged its highest-ever fourth-quarter orders. Nvidia rose 1.6%, Intel surged 11%, while Micron and Microchip each added more than 6%. The Philadelphia Semiconductor Index rose 2.3%. Texas Instruments gained 9.9% after forecasting first-quarter revenue and profit above expectations.
Not all growth names joined the rally, with Carvana shedding 14.2% after short seller Gotham City Research published a critical report alleging accounting issues and inflated earnings.
Europe slips as luxury slump deepens on cautious outlooks
European markets fell, led by another sharp drop in luxury stocks.
Luxury shares slid 3.8%, their fourth straight daily decline. LVMH dropped 7.9% after CEO Bernard Arnault struck a cautious tone on the year ahead. Kering fell 3%, Moncler eased 2.9% and Hermes lost 3.7%.
The FTSEurofirst 300 shed 0.9%, while London’s FTSE 100 fell 0.5%.
FX check: Aussie tests 70 US cents as euro fades and yen weakens
- The euro slipped from US$1.2025 to US$1.1900, ending near US$1.1945.
- The Aussie rose from US69.78¢ to highs near US70.35¢.
- The yen weakened from JPY152.29 to JPY153.99, ending near JPY153.35.
Commodities: oil hits highest since September, gold rockets to new records
- Oil climbed to its highest since late September on looming Iran concerns and a weaker US dollar. Brent rose US83¢(1.2%) to US$68.40 a barrel and Nymex gained US82¢ (1.3%) to US$63.21.
- Gold surged again as investors leaned into uncertainty. Gold futures jumped US$221 (4.3%) to US$5,303.60 an ounce, while spot gold traded near US$5,386 late in US trade.
- Base metals advanced, with copper up 1.1% and aluminium higher by 1.7%, helped by a softer US dollar and continued speculative buying.
- Iron ore dipped US18¢ (0.2%) to US$105.85 a tonne as demand softened with Chinese construction activity slowing ahead of the Lunar New Year.
What to watch today: data prints and heavyweight earnings
- Australia: international trade price indexes due; Whitehaven Coal, Mineral Resources and Liontown Resources expected to issue quarterly updates.
- Global: Sweden’s Riksbank policy decision.
- US: jobless claims, factory orders and international trade data.
- Earnings: Apple, Visa, Mastercard, Royal Caribbean and Caterpillar.