AM 29 Sep 26: RBA decision day
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What is the main topic discussed in this episode?
A listener production.
Wall Street falls as bond yields jump on inflation fears.
Oil prices rise after the US rejects proposed peace plan by Iran.
And it's RBA day in Australia. Will the central bank follow through with another rate hike? Good morning, I'm James Gruber. And I'm James Tao, aka JT. It's Tuesday the 29th of September and this is the morning edition of the ComSec Market Update.
Why are rising oil prices and bond yields weighing on Wall Street?
James, it was another weaker session on Wall Street overnight. It was really a continuation of that ongoing theme that we've seen for a little while now, higher bond yields and oil prices, obviously in turn fanning those inflation fears and concerns. And that's really been hampering US markets in particular in the overnight session. Having said that, though, the NASDAQ did hit record highs just last week in the S&P 500. Also, within striking distance of all-time highs, it's roughly about that 1.5% off those levels at the moment. So there was also a little bit of good news in terms that oil prices did ease from intraday highs as well.
Yeah, that's right, JT. So oil markets continue their recent bumpy ride with prices reacting to diplomatic efforts between the US and Iran to open the Strait of Hormuz. But it's a tug of war at the moment between good news out of increased Saudi supply, but also slow progress towards a meaningful US-Iran peace deal.
Is the RBA expected to raise interest rates again, and what would the hike mean?
But there's another event that's been drawing plenty of attention, and that's today's RBA interest rate decision.
Yes, that's right. Happy RBA day to those who celebrate.
So the RBA will finally hand down its interest rate decision at 2.30pm EST this afternoon. Markets are overwhelmingly expecting a 25 basis point rate hike, about a 93% chance that will happen, which would take the cash rate to 4.6%. If that eventuates, interest rates would be at their highest level in almost 16 years, which is hard to believe, as the central bank continues its battle against inflation.
How did the ASX perform, and what could move Australian shares today?
Yeah, in the local market here, that was certainly pretty watchful in anticipation of the rate decision, which will come out later today. The ASX 200 enjoyed a decent start to the week yesterday. We had the benchmark index adding roughly 15 points, or about a fifth of 1%, to 8,679 points. It did snap a two-day losing run as well from the back end of last week. So we saw a Some gains from the financials and healthcare in particular, doing much of the heavy lifting and really helping to pushing the market higher. Losses among miners, the material sector really was the main drag, and that certainly kept a lid on broader gains as well. This morning, the Aussie share market is set to open modestly higher, a very small gain if we look at index futures up around a tenth of 1%.
So miners, well, they may continue to struggle. We had some lower metals prices that you'll talk about. Energy stocks could gain as well, given those higher crude prices that we just talked about.
How are oil, metals, gold and currency markets performing?
But having talked to that, let's move over to commodities now. James, what can you tell us about that?
Yeah, and on those oil prices, they rose but eased off session hires on expectations that Qatari mediators would hold talks with the US and Iran to try to find a possible peace deal. Brent crude futures settled almost 1% higher at $105.28 a barrel. Base metal prices were lower, copper futures declined nearly 2% to their lowest in more than a week, as weak economic data from top consumer China, rising oil prices and the stronger dollar reinforced weak demand prospects. Meanwhile, aluminium futures retreated 1.4%. Gold futures hit a seven-week low as rising oil prices stoked inflation concerns and bolstered bets on tighter monetary policy. The futures settled down 3.5% at US$4,168 an ounce. Iron ore futures settled 0.1% lower at US$96.92 a tonne.
And now looking at the currencies, well, global currencies were mixed against the US dollar. We had one Australian dollar now buying about 70.17 US cents. That did ease just a touch. A euro continues to trade just under $1.14 US, while one US dollar is buying about 157.37 Japanese yen.
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Chapters
8 chapters
1
What is the main topic discussed in this episode?
0:02–0:33
2
Why are rising oil prices and bond yields weighing on Wall Street?
0:33–1:32
3
Is the RBA expected to raise interest rates again, and what would the hike mean?
1:32–2:11
4
How did the ASX perform, and what could move Australian shares today?
2:11–3:10
5
How are oil, metals, gold and currency markets performing?
3:10–4:38
6
How did oil prices and rising Treasury yields affect US and European markets?
4:38–6:52
7
What Australian economic data, dividends and US indicators are investors watching?
6:52–8:02
8
Why are many investors underperforming the share market this year?
8:02–9:55
Speakers
3 identifiedMore from CommSec Market Update
PM 28 Sep 26: Caution ahead of likely RBA rate hike?
AM 28 Sep 26: Key week for rates, ASX to open flat
PM 25 Sep 26: Markets brace for rate hike
AM 25 Sep 26: ASX set to fall, oil prices back in focus
PM 24 Sep 26: ASX reacts to higher unemployment
AM 24 Sep 26: Wall Street tumbles as bond yields surge