AM 14 Sep 26: ASX set to rise ahead of big week for central banks
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What is the main topic discussed in this episode?
A listener production.
Consumer price inflation figures lift US rate hike bets. US stocks rise as oil drops. And the ASX expected to be a little higher at the open. Good morning, I'm James Gruber. And I'm Gillian Bowen.
What are the market expectations for the US Federal Reserve rate decision this week?
It's Monday, the 14th of September, and this is the morning edition of the Comsec Market Update.
Well, welcome to a new week, a key week for interest rates. We've got two central banks making decisions this week: the US Fed Reserve on Wednesday, US time, and then the Bank of Japan on Friday. And there are some public appearances by RBA officials as well, including Governor Michelle Bullock and many of her team appearing before the House of Reps Economics Committee at Federal Parliament on Friday. Now, seeing the US Fed is up first, let's start there. James, what are markets expecting?
Well, there are expectations that the US Federal Reserve will raise rates by 25 basis points to 3.75 to 4%. If that happens, and it would mark the central bank's first rate increase since July 2023, so more than three years. There are rising inflationary pressures in the US, including from the Middle East conflict, which has been dragging on for more than six months. And it'll be interesting to hear. What US Fed Reserve Chair Kevin Walsh has to say once the decision is revealed.
How will the ASX open after Friday’s mixed performance and Wall Street gains?
So an interesting week ahead for markets, that's for sure. Plenty to digest. Now, as for our open later this morning, we look set for a brighter start. Our index futures up 0.2%. That follows a strong finish on Wall Street at the end of the week. On Friday, our share market closed lower to post its second biggest weekly decline of the year. The ASX 200 lost 0%. 0.9% to 8,741.2. Let's turn to commodities now. James, what's the latest?
Bit of a mixed bag, actually. Global oil prices fell after the reports that foreign ministers in the Middle East are trying to work out a temporary deal with Iran to manage shipping through the Strait of Hormuz.
What impact did falling oil prices and Middle‑East talks have on commodity markets?
Brent crude futures settled down two point eight percent. One hundred and four point six one US dollars a barrel. Base metal prices were mixed, copper futures were flat, though end of the week, with their first weekly drop since June. Meanwhile, aluminium futures dipped 2% on hopes that the Middle East talks could ease supply constraints on the metal. Gold futures were steady also, even though U.S. consumer inflation data beat estimates, and increased odds of a Federal Reserve rate increase this week. to settle flat at $4,409 US dollars an ounce. Iron ore futures slid for a third straight session, pressured by lower than expected demand and a sharp squeeze in steel margins in top consumer China. The futures settled 0.7% lower at $98.02 US dollars a ton.
So if we have a look at currencies, they were steady against the US dollar mostly this morning. One Australian dollar is buying 71.61 US cents. The euro is worth 1.1597 US dollars, while one US dollar is buying 153.94 Japanese yen. Let's get a wrap of what's happened overseas with markets. So the Dow Jones Index finished up one percent, the S P five hundred rose zero point nine percent, and the NASDAQ gained one percent as well. James, what was contributing to the gains?
While US share markets were higher on Friday, helped by easing oil prices, even as strong consumer price data reinforced expectations that the US Federal Reserve will raise interest rates this week to fight inflation, the U.S. Consumer Price Index, or CPI, climbed 0.4% in August from a month earlier, or 3.4% on an annual basis in line with expectations. Core CPI accelerated 0.3% for the month, a bit higher than predicted. That led traders to increase the odds for a Federal Reserve rate hike this Wednesday to 88%. Nine of the 11 SP 500 sector indexes rose on Friday, led by communication services up 1.4%, followed by a 1.1% gain in consumer discretionary. ServerMaker Dell soared 12% to a record high, Hewlett Packer jumped 12%, and HP gained 8%.
After Oracle's quarterly results topped estimates, Oracle dipped 1.8%. Shares of ACV auctions soared 44%. After online vehicle auctioneer Copart agreed to buy it in a near 2 billion US dollar deal.
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Chapters
8 chapters
1
What is the main topic discussed in this episode?
0:02–0:21
2
What are the market expectations for the US Federal Reserve rate decision this week?
0:21–1:32
3
How will the ASX open after Friday’s mixed performance and Wall Street gains?
1:32–2:18
4
What impact did falling oil prices and Middle‑East talks have on commodity markets?
2:18–5:01
5
Which US sectors and stocks drove the Dow, S&P 500 and Nasdaq higher on Friday?
5:01–6:32
6
How did European markets react to retreating oil prices and rising inflation expectations?
6:32–7:48
7
What does the ABS data reveal about Australian government spending in the 2025‑26 fiscal year?
7:48–8:14
8
What are the key takeaways and upcoming watch‑list items for Australian investors?
8:14–8:33