Markets Overview

  • ASX SPI 200 futures down 0.3% to 7,057.00
  • Dow Average down 0.5% to 34,288.83
  • Aussie up 0.1% to 0.6423 per US$
  • U.S. 10-year yield fell 1.2bps to 4.3261%
  • Australia 3-year bond yield rose 0.8 bps to 3.91%
  • Australia 10-year bond yield rose 0.6 bps to 4.27%
  • Gold spot up 0.1% to $1,897.59
  • Brent futures down 0.6% to $83.93/bbl

Economic Events

  • 09:00: (AU) Aug. Judo Bank Australia PMI Servic, prior 47.9
  • 09:00: (AU) Aug. Judo Bank Australia PMI Compos, prior 48.2
  • 09:00: (AU) Aug. Judo Bank Australia PMI Mfg, prior 49.6
  • 11:00: (AU) Australia to Sell A$700 Million 3% 2033 Bonds

Asian equity futures declined as Wall Street’s risk-on mood faded a day after the rally in big tech.

Stock traders are awaiting Nvidia Corp.’s results later Wednesday, which are set to test the fervor around the artificial-intelligence hype, while wider markets are marking time ahead of a speech from Federal Reserve Chair Jerome Powell on Friday.

Contracts for Japanese shares dropped 0.6%, those for Hong Kong slipped 0.5% and futures for Australia’s benchmark eased 0.2%. Elevated bond yields continue to cause concern, even as moves moderated on Tuesday.

The 10-year Treasury rates were little changed after benchmark yields hit an almost 16-year high Monday as the resilient economy has investors positioning for the Federal Reserve to keep borrowing costs elevated.

The S&P 500 extended its August slide, with banks dropping as S&P Global Ratings joined Moody’s Investors Service in cutting some US lenders amid a “tough” climate. Macy’s Inc. sank 14% as credit-card delinquencies accelerated, raising a red flag about consumer health. Nvidia fell 2.8% on the eve of its quarterly report.

In a sign of how significant Nvidia’s results will be, the options market is bracing for a move of about 10% following the results. With Nvidia accounting for over 3% of the S&P 500, the stock action will possibly have broader implications. The shares briefly touched an all-time high on Tuesday.



Other News

Australia’s facing a major demographic shift in the coming four decades, with the number of elderly citizens predicted to swell, while overall population growth slows.

Australia’s population is expected to grow to more than 40 million people by the early 2060s, according to data from the government’s latest intergenerational report released on Sunday. Population growth is tipped to slow to 1.1% over the next 40 years, down from 1.4% over the past 40 years, according to the data. The full report, designed to guide lawmakers’ long-term policy, will be released Thursday.

The country’s residents are also expected to live longer, with the number of people over the age of 85 predicted to triple over coming decades, while the over-65 population is set to double. As a result, the country’s aged-care economy could almost double to as much as 15% of gross domestic product by the 2060s.

Separate intergenerational report data released earlier on Sunday showed Australia’s aging population and the cost of servicing debt was expected to blow out government spending by about A$140 billion ($90 billion) over the next 40 years.

With Australia’s demographic outlook worsening, the report said three of the five fastest-growing spending pressures in the decades ahead were expected to be health, aged care and the National Disability Insurance Scheme.

The report showed that growth in the care economy was set to be one of the most prominent shifts in coming decades, Treasurer Jim Chalmers said in an emailed statement.

“What the Intergenerational Report reveals is after this year, the pressure on the budget intensifies,” he said.