Outlook for the day: Mildly negative ahead of August jobs data following a mixed finish on Wall Street as investors weighed an inflation report that had something for bulls and bears.
ASX futures: down five points or 0.07%
Overnight themes:
Wall Street's main indices finish mixed after an uptick in inflation increases the odds on another hike in November.
A mixed August inflation report includes the biggest jump in headline inflation in 14 months. The consumer price index pops 0.6% for the month. Fuel prices account for more than half the increase. Year-on-year price inflation rises to 3.7% from 3.2% in July.
However, the Federal Reserve's preferred measure, annual core inflation, eases to 4.2% from 4.7% in July, giving the central bank room to leave rates unchanged this month.
A September rates pause remains a near-certainty at 97% following the report, according to CME's FedWatch tool. The odds on a November hike rise to 61%.
“This isn’t the goldilocks number that investors were hoping for, but markets can still trade in a range — as inflation is high enough to keep the Fed still in play, but not hot enough for a shift away from the ‘Fed is almost done’ narrative” - Chris Zaccarelli, chief investment officer at Independent Advisor Alliance.
Growth sectors rally, boosted by Tesla, Meta, Microsoft and Amazon. Utilities is the pick of the sectors, implying a mild defensive bias among investors. Real estate, energy, industrials, materials and financials all decline.
Gold eases to a fresh three-week low as US inflation data pushes out hopes for rate cuts.
"As long as hopes for Fed rate cuts are kept at bay, bullion bulls should struggle to carve out meaningful gains for the precious metal” - Han Tan, chief market analyst at Exinity.
Oil retreats on fears that higher US interest rates will constrain energy demand.
Iron ore is boosted by restocking ahead of Chinese holidays at the end of the month. Most base metals reverse some of Tuesday night's losses.
Key events today:
August employment report (expected: +25,400 jobs, jobless rate steady at 3.7%) - 11.30 am AEST
US retail sales, wholesale inflation - tonight
Eurozone interest rate decision
S&P 500: up six points or 0.12%
Dow: down 70 points or 0.2%
Nasdaq: up 40 points or 0.29%
Dollar: down 0.07% to 64.23 US cents
Iron ore (Dalian): up 0.47% to US$118.13
Brent crude: down 18 US cents or 0.2% to US$91.88
Gold: down US$2.60 or 0.1% to US$1,932.50
NYSE Arca Gold Bugs: unchanged
Copper (LME): up 0.04% to US$8,394
Nickel (LME): up 1.43% to US$20,150
Lithium carbonate (China spot): down 1.05% to US$26,289
