Wall Street Extends Record Run
US stocks rallied again on Wednesday, pushing the Dow Jones Industrial Average up 1% to 44,922. The S&P 500 gained 0.3% to 6,466, while the Nasdaq Composite added 0.1% to 21,713. Both the S&P and Nasdaq closed at record highs for the second straight day.
The advance was led by a 5.4% jump in AMD, while Apple gained 1.6%. Paramount Skydance shares surged nearly 37%. The moves follow Tuesday’s softer-than-expected US inflation report, which bolstered expectations for a Federal Reserve interest rate cut in September.
Rate Cut Bets Firm
Traders are now pricing in a 100% chance of at least a quarter-point reduction next month, according to the CME’s FedWatch Tool. US bonds rallied on the view that rates could fall by as much as 175 basis points over a series of cuts. Lower interest rate expectations also lifted small-cap stocks, with the Russell 2000 up 2%.
The focus now turns to Thursday’s US producer price index, which will add to the inflation picture ahead of the Fed’s Jackson Hole conference later this month.
Australian Market Outlook
Australian shares are set to open higher, with the SPI 200 futures pointing up 31 points, or 0.4%, to 8,825. Results are due from Origin Energy, ASX, and Suncorp, with Temple & Webster, Abacus Storage King, and Pro Medicus also reporting later in the week.
The Australian dollar rose 0.3% to US65.46¢, gold edged up to US$3,355.86 an ounce, while Brent crude slipped 0.5% to US$65.77 a barrel. Bitcoin jumped 2.4% to US$122,990.
Jobs Data Ahead
Australia’s July employment report is due at 11.30am. Economists expect a modest rebound in job creation after two weak months, with unemployment forecast to hold at 4.3%. Another soft reading could fuel speculation of consecutive rate cuts from the Reserve Bank.
Overseas, the UK and EU will release second-quarter GDP figures, Norway’s central bank is expected to keep rates on hold, and the US will publish July PPI data alongside weekly jobless claims.
Telstra Profit Jumps
Telstra posted results this morning, reporting a 31% lift in full-year net profit to $2.34bn, driven by higher group revenue and a 6% reduction in operating expenses. Underlying EBITDA rose almost 5% to $8.6bn, in line with guidance. The company declared a 19¢ full-year dividend, up 5.6% on last year, and announced a new $1bn on-market share buyback to begin after September 8. Chief executive Vicki Brady said the move reflected Telstra’s strong balance sheet and confidence in its outlook.
