Markets Overview

  • ASX SPI 200 futures down 0.7% to 7,080.00
  • Dow Average down 0.8% to 32,910.90
  • Aussie down 0.6% to 0.7191 per US$
  • U.S. 10-year yield rose 4.9bps to 3.0233%
  • Australia 3-year bond yield fell 5bps to 3.08%
  • Australia 10-year bond yield fell 1bp to 3.55%
  • Gold spot little changed at $1,853.04
  • Brent futures up 2.7% to $123.87/bbl

Economic Events

  • 10:30am: (AU) Australia to Sell A$1.5 Billion 77-Day Bills
  • 10:30am: (AU) Australia to Sell A$1 Billion 105-Day Bills

US stocks fell after a two-day rally and oil continued its relentless rise, fueling worries about inflation and measures by central banks to contain it.

The S&P 500 ended near session lows, with all but one of the 11 major sectors in the red. The tech-heavy Nasdaq 100 dropped 0.8% after rising as much as 0.5%.

Benchmark Treasury yields topped the psychological threshold of 3%. Oil climbed above $120 a barrel as inventory data highlighted the supply crunch.

US CPI data on Friday is expected to show inflation picked up in May from a month earlier, while slowing slightly from a year earlier but staying above the 8% level. That’s likely to keep pressure on the Fed to stick to aggressive rate hikes.

Other News

Australia will seek to boost the ability of the country’s main energy market operator to store gas to prevent future price spikes.

Energy minister Chris Bowen said enhancing the powers of the Australian Energy Market Operator, and its ability to stockpile fuel, are among a package of measures agreed Wednesday following a meeting with state-level counterparts.

Officials are seeking to combat skyrocketing costs of electricity and gas, and to be better prepared for similar issues in the future. The ministers had agreed to “around eleven” actions and will meet again next month, Bowen said. Details of other key measures haven’t yet been disclosed.

Australia generates most of its power using coal, and outages at some aging facilities amid colder-than-usual weather have boosted the need for gas. That’s caused problems because of the increased international competition for the fuel as major consumers including Europe shun supplies from Russia over the war in Ukraine.

Prime Minister Anthony Albanese, sworn in as Australia’s new leader on May 23, has pledged to increase adoption of renewables, invest in electricity infrastructure and to accelerate efforts to curb greenhouse gas emissions.