The Australian share price benchmark is expected to shrug off a record high gold price to open little changed on Wednesday after a weaker night in the United States, where profit-taking pulled stock indices back from record levels.
The S&P/ASX 200 index should start the day flat with the December share price index contract trading just one point below the prior settlement at 8,986, a 29.2 point premium to where the underlying market finished on Tuesday.
Chief CommSec Economist Ryan Felsman said losses in some stocks on the Australian Securities Exchange (ASX) were likely to be offset by gains in gold stocks, which would be boosted by the precious metal trading above US$4,000 an ounce for the first time.
U.S. gold futures surged past the milestone on Tuesday due to expectations of a Federal Reserve rate cut later this month and safe-haven buying due to the ongoing U.S. government shutdown.
“We're trying to get past the 9,000 level at the moment, which is proving quite difficult and we haven't really been past much since August so getting to that record high is proving a bit insurmountable at the moment,” Felsman said.
The high of 9,019.1 was reached on 21 August.
The Dow Jones Industrial Average lost 0.2%, the S&P 500 dropped 0.4% and the Nasdaq Composite shed 0.7% on Tuesday after a New York Federal Reserve survey showing deteriorating consumer expectations and higher inflation projections received more intense scrutiny due to the federal data blackout entering a seventh day.
"The New York Fed report probably gave traders an excuse to take some profits since the S&P had been up for seven days in a row," CFRA Research Chief Investment Strategist Sam Stovall was quoted saying in a Reuters story.
"There is an awful lot of uncertainty the longer the government remains shut down because of the absence of any economic data."
The Australian market had fallen on Tuesday, with the S&P/ASX 200 closing 0.3% lower at 8,956.8, with ten of the eleven sectors ending in the red.
Companies to watch today include Transurban (ASX: TCL), which holds its annual general meeting, and Vulcan Steel (ASX: VSL), whose shares trade ex-dividend.
In fixed interest markets, yields on Australian Government bonds inched higher with two-year rates adding 0.03% to 3.513% and 10-year rates gaining 0.11% to 4.368%.
