ASX eyes RBA day losses as Wall Street swings

A late rally in big tech stocks erased an afternoon slump on Wall Street and left major indexes slightly higher. The uneven start to May followed a brutal April in which massive tech sales sent major benchmarks tumbling.

The S&P 500 ended up 0.6%. It had fallen to 1.7% earlier. The Dow Jones Industrial Average rose 0.3% and the Nasdaq 1.6%.

The Australian stock market is expected to take more losses, with futures at 6:00 a.m. AEST showing a drop of 21 points, or 0.3%, at the open. The ASX fell 1.2% on Monday. The Reserve Bank of Australia meets today and is expected to raise interest rates for the first time since 2010.

Wall Street continues to head south.Credit:NYSE

Parent Facebook and chipmaker Nvidia each rose more than 5%.

The uneven start to May follows a dismal April, where big tech companies dragged the broader market down as they began to look overvalued, especially with interest rates expected to rise sharply. increase.

US crude oil prices remained relatively unchanged after slipping earlier in the day. EU energy ministers meet in Brussels to discuss Russian supply problems and sanctions. Russia’s invasion of Ukraine caused already high oil and natural gas prices to spike.

Bond yields rose significantly. The 10-year Treasury yield was 2.98% after briefly rising to 3.00% from 2.89% on Friday night. It had not exceeded 3% since December 3, 2018, according to Tradeweb.

Treasury yields have risen all year as investors brace for higher interest rates. Markets are expecting a very big interest rate hike this week from the Federal Reserve as it tries to rein in inflation, which is at its highest level in four decades.

The central bank is expected to raise short-term interest rates to double the usual amount when it releases its latest statement on Wednesday. It has already raised its key overnight rate once, the first such increase since 2018, and Wall Street expects several big increases in the coming months.

Leave a Comment