The Australian share market is poised to fall on Monday as it joins other markets in holding its breath as they await the first interest rate cut in the United States since Donald Trump returned to power.
Futures trading on the Australian Securities Exchange (ASX) points to the main price marker dropping by about 0.7% when trading begins at 10:00 am AEST (12:00 am GMT Sunday).
The S&P/ASX 200 share price index September contract was trading 59 points below the previous settlement at 8,804, at the time of writing.
This followed a mixed session on Wall Street on Friday (Saturday AEST), where the Nasdaq composite index closed at a new peak but the other indices ended down as eyes remained fixed on the United States Federal Reserve Board’s next move.
The Nasdaq rose 0.4% while the Dow Jones Industrial Average dropped 0.6% and the S&P 500 gave away 0.05%.
The Fed under Chair Jerome Powell is widely expected to cut rates by at least 25 basis points on Wednesday (Thursday AEST) to support job creation in the world’s largest economy.
"There's really not going to be any data between now and Wednesday. It's a sort of wait-and-see attitude," CFRA Research Chief Investment Strategist Sam Stovall was quoted in a Reuters story as saying.
The Nasdaq rally was powered by strength in technology stocks like Tesla and rate cut expectations.
The Australian market had rallied on Friday, with the S&P/ASX 200 putting on 0.68% to finish on 8,864.9 points.
Stocks that may come under additional selling pressure include Guzman y Gomez (ASX: GYG) and Lovisa (ASX: LOV), which trade ex-dividend.
In fixed interest markets, the Australian Government bond yields rose with two-year rates adding 0.03% to 3.404% and 10-year rates putting on 0.57% to 4.233.%.
