Share prices in Australia are set to open higher following a positive night in New York with tariffs continuing to dominate market sentiment.
Futures trading ahead of the 10 am AEDT (11 pm GMT) start in trading on the Australian Securities Exchange (ASX) indicated the benchmark index would begin up about 0.6%.
The tone was set on Wall Street where the main indices climbed as a result of factors including a strong performance from software company Palantir.
The Dow Jones Industrial Average gained 0.3%, the S&P 500 0.7% and the Nasdaq Composite Index 1.4%.
In Australia, the S&P/ASX 200 finished 5.4 points lower at 8,374 on Tuesday after giving up gains on news that China was retaliating with tariffs on some U.S. imports.
Morgans Financial private client adviser Lachlan Walsh said although the ASX index would be higher at the start he expected trading to be volatile.
“It was up about 50 points yesterday but then it closed down,” Walsh said.
He said trading would be influenced by news of U.S. tariffs on its trading partners including China and Canada and any responses from those countries.
China on Tuesday introduced tariffs of up to 15% on U.S. coal and liquefied natural gas, along with a 10% increase in duties on crude oil, farm equipment, and some automobiles, effective 10 February.
“We’re sitting here waiting to see what comes out of the U.S. and China,” Walsh said.
Chinese tariffs could be positive for Australian companies supplying China such as iron ore miners like BHP and Rio Tinto and oil producers.
He also expected strength in technology stocks following Palantir’s 24% surge to new highs after the company’s fourth-quarter earnings exceeded analyst expectations.
On fixed interest markets, Australian Government bond yields rose with 10-year and two-year rates up 0.32% and 0.13% at 4.439% and 3.800% respectively.