Source : the age
The Australian sharemarket edged up in early trade ahead of the nation’s latest inflation figures, seen as key to the Reserve Bank’s decision on whether to rate interest rates for a fifth time this year.
The S&P/ASX was up 39 points, or 0.4 per cent, to 8889.10 as of 10.22am AEDT, tracking gains on Wall Street. Miners and tech stocks powered the gains, while energy stocks, retailers and banks declined. The ASX added 0.5 per cent on Tuesday. The Australian dollar was stronger at US70.28¢.
The Australian Bureau of Statistics is scheduled to release the inflation data for September at 11.30am AEDT, with the figures widely expected to confirm ongoing price pressures for household essentials, which could prompt a further interest rate hike from the RBA when it meets next week.
On Wall Street overnight, renewed enthusiasm for artificial intelligence lifted equities ahead of earnings from some of the biggest tech companies and the Federal Reserve’s rate decision.
The S&P 500 rose 0.6 per cent and pulled within 1.2 per cent of its all-time high set earlier this month. The Dow Jones Industrial Average added 15 points, or less than 0.1 per cent, and the Nasdaq composite climbed 1.2 per cent.
The majority of stocks within the S&P 500 fell, but the gains for influential AI stocks made up for that. AI stocks rose to another winning day after swerving for weeks on worries about whether their boom is under threat because of how expensive it’s become for companies to borrow money to build data centres and buy more AI chips.
Broadcom climbed 4 per cent after announcing a $US63 billion ($89.6 billion) financing deal where several Wall Street firms will help Anthropic get access to Broadcom’s XPU AI accelerators and networking solutions.
Elsewhere in the industry, Nvidia added 0.9 per cent and was one of the strongest forces behind Broadcom pushing the S&P 500 higher. CoreWeave, a company that’s borrowed money to buy AI chips that it rents out to customers over the cloud, jumped 7.9 per cent and was consistently higher through the day following several days of sharp swings.
General Motors climbed 5.5 per cent after saying it’s moving its stock from a listing on the New York Stock Exchange to the Nasdaq. The automaker said the Nasdaq, which is home to several of the world’s biggest technology stocks, is a fit for its tech-driven strategy. The move could also allow GM to join the Nasdaq 100 index, which would force investment funds that mimic the index to buy it.
GM began trading on the New York Stock Exchange in 1911.
JetBlue Airways flew 19 per cent higher even though it reported a larger loss for the summer than analysts expected. CEO Joanna Geraghty said the company expects to return to making sustained operating profits next year and to deliver at least $1 in earnings per share in 2028.
Investors may have been bracing for something worse after the airline’s stock came into the day with a loss of nearly 48 per cent for the year so far.
Another travel company, Royal Caribbean Group, also helped lead the market and rose 5.5 per cent. The cruise operator delivered a stronger profit for the summer than analysts expected, while raising its forecast for profit over the full year.
Companies overall are under pressure to deliver big growth in profits. Expectations are high among financial analysts and investors, and that’s what allowed their stock prices to run to records recently despite high inflation, high interest rates and other concerns weighing on the market.
Boeing fell 10.7 per cent after reporting a larger loss for the latest quarter than analysts expected.
Hilton Worldwide Holdings sank 2.1 per cent after reporting weaker revenue for the summer than analysts expected. The hotel company said it expects to see “increased impact from the Middle East” during the quarter.
Sherwin-Williams fell 2.7 per cent after delivering a weaker profit than analysts expected. High mortgage rates have chilled the housing industry, which in turn pressures demand for the paints and coatings Sherwin-Williams sells.
Confidence among US shoppers has tumbled recently as pressure keeps building on them from high inflation. But a report on Tuesday said that US consumer confidence improved in October, when economists expected further weakening.
In the bond market, Treasury yields held relatively steady a day before the Federal Reserve is scheduled to announce its latest decision on interest rates. The Fed last month hiked the fed funds rate for the first time in three years in hopes of slowing inflation, but the widespread expectation on Wall Street is that it will hold rates steady this time.
The yield on the 10-year Treasury edged down to 4.99 per cent from 5.00 per cent late on Monday.
Helping to keep yields in check was a drop for oil prices. The price for a barrel of Brent crude fell 1.2 per cent to $US109.41.
In other international markets, indexes were mixed across Europe and Asia. Stocks jumped 3.1 per cent in Seoul and fell 1.3 per cent in Shanghai for two of the bigger moves.
