Morning traders. Thanks loungers, especially @Ravgnome.
Outlook for the day: Positive ahead of this afternoon's interest rate decision as strong US leads offset further weakness in iron ore, copper and battery metals.
ASX futures: up 29 points or 0.38%
Overnight themes:
US stocks rose as brokers lifted their year-end targets for the S&P 500 and megacap tech stocks continued to fuel gains.
The S&P 500 and Nasdaq Composite closed at new highs, adding 0.77% and 0.95%, respectively.
The Dow broke a four-session losing run with a gain of 0.49%.
Apple, Microsoft and Tesla provided much of the night's momentum as most of the Magnificent 7 finished higher. Nvidia hit a new record before fading to a loss of 0.68%. Broadcom set a new peak.
Optimism over the year ahead was boosted by year-end upgrades from brokers Goldman Sachs and Evercore ISI. Goldman raised its year-end target for the S&P 500 from 5,200 to 5,600. Evercore lifted its forecast to 6,000 from 4,750.
Also helping market sentiment: Federal Reserve policy-maker Patrick Harker said the central bank will be able to cut official rates this year if the economy plays out as he expects. "If all of it happens to be as forecasted, I think one rate cut would be appropriate by year's end," Harker told an event in Philadelphia.
The best of the sector moves were consumer discretionary +1.43%, tech +1.18% and industrials +1.08%. The financials sector gained 0.81%. Materials bounced 0.7%. Three sectors sat out the rally: utilities, real estate and health.
“Today is a follow through from what we’ve seen over the last week. We’re seeing optimism around a number of factors that have been mixed for quite some time... The economic data is starting to come in stronger with more consistency, you’ve got signs of a resilient economy. Certainly, there’s optimism and bullishness around a greater likelihood of the potential start of rate cuts" - Greg Bassuk, CEO at AXS Investments (per CNBC).
Oil logged its highest close since late April after China reported a 1.8% decline in oil-refinery output. Brent crude rallied almost 2% to a level last seen on April 30.
Copper touched its lowest level in almost eight weeks in London following soft Chinese factory data. A report yesterday showed Chinese industrial output last month grew 5.6% year-on-year, down from growth of 6.7% in April. LME Copper declined 0.46% and is now 14% below last month's record.
Iron ore wilted as soft Chinese factory data was compounded by grim news on house sales. House prices fell in May at the fastest pace in nearly a decade. Investments in property are down 10.1% so far this year from the same period last year. Benchmark ore prices in China dropped 1.63% in daytime trade.
The Reserve Bank met yesterday and reconvenes today to conclude this month's policy meeting. The central bank will announce the cash rate target at 2.30 pm AEST. No change is expected from the current rate of 4.35%.
