Markets Overview

  • ASX SPI 200 futures down 0.2% to 7,806.00
  • Dow Average up 0.4% to 39,056.39
  • Aussie down 0.3% to 0.6580 per US$
  • US 10-year yield rose 3.9bps to 4.4958%
  • Australia 3-year bond yield rose 1.9 bps to 3.94%
  • Australia 10-year bond yield fell 1.3 bps to 4.29%
  • Gold spot down 0.2% to $2,308.89
  • Brent futures up 0.7% to $83.77/bbl

Economic Events

  • 10:30: (AU) Australia to Sell A$1 Billion 63-Day Bills
  • 10:30: (AU) Australia to Sell A$1 Billion 126-Day Bills

Wall Street’s enthusiasm for stocks faded as many traders were reluctant to keep piling in after a solid rally in early May.

The S&P 500 closed little changed, remaining below the 5,200 mark that it briefly touched this week. Treasuries remained lower after a $42 billion sale of 10-year bonds saw tepid demand.

The S&P 500 hovered near 5,190, following its biggest four-day advance since November. Treasury 10-year yields rose three basis points to 4.49%.

Other News

Australia is calling for the development of new natural gas resources to ensure it remains affordable and the nation continues as a major exporter, the latest shift by the center-left Labor government toward greater support for the fossil fuel.

The government will release a long-term framework, called the Future Gas Strategy, to establish gas’s role in the transition to cleaner energy as it looks to meet a target for net zero by 2050. That will open it up to criticism to pandering to the A$72 billion liquefied natural gas export industry, which argues that the nation faces a domestic shortfall as new projects have been stalled by onerous regulations.

“The strategy makes it clear that gas will remain an important source of energy through to 2050 and beyond,” Minister for Resources Madeleine King said in a statement. “Gas plays a crucial role in supporting our economy. We will need continued exploration, investment and development.”

Prime Minister Anthony Albanese’s government was elected in May 2022 with a strong mandate to take tough action on climate change, and Australia is replacing its aging fleet of coal-fired power generation with renewables and has introduced fuel-emission standards. The new gas strategy echoes major energy producers including Chevron Corp. and Shell Plc, who say the fuel is needed in the energy transition, but is likely to anger left-wing lawmakers opposed to new production who hold the balance of power in the Senate.

Australia exports almost all of the gas it produces and its massive LNG facilities are among its worst polluters. Some of the biggest buyers — including Japan and South Korea — have raised concerns about future supply and King has visited both nations to assure them all contracts will be honored.