Australia

Australian shares are set to open sharply down after the Federal Reserve raised rates by .75 and a wild ride on Wall Street ended with US shares falling significantly.

ASX futures were down 1.62% at 6978 as of 7:00am on Thursday.

US stocks were down moderately prior to the Federal Reserve announcing that interest rates would again be raised .75. After the announcement the major US indexes swung positive as investors interpreted the official statement from the Federal Reserve as suggesting that rate hikes would slow. That brief optimism quickly disappeared as Federal Reserve Chairman Jerome Powell indicated that interpretation was incorrect.

The S&P 500 fell 96.41 points or 2.50% to 3,759.69. The Nasdaq Composite followed suit with a drop of 366.05 points or 3.36% to 10,524.80.

In commodity markets, Brent crude oil gained .99% to US$95.59 a barrel, gold fell 0.80% to US$1,635.66.

In local bond markets, the yield on Australian 2 Year government bonds rose to 3.37% while the 10 Year rose to 3.90%. Overseas, the yield on 2 Year US Treasury notes rose to 4.62% and the yield on the 10 Year US Treasury notes rose to 4.10%.

The Australian dollar fell to 63.59 US cents up slightly from the previous close of 63.95.

Asia

Chinese shares continued their rally yesterday with the Shanghai Composite Index up 1.15% while Hong Kong's Hang Seng Index rose 2.41%. In Japan, the Nikkei Stock Average dropped 0.06% at 27,663.

Europe

European stocks fell with the French CAC 40 dropping .81% and the German DAX down .61%. The FTSE 100 Index fell .58%.

North America

The S&P 500 fell 96.41 points or 2.50% to 3,759.69. The Nasdaq Composite followed suit with a drop of 366.05 points or 3.36% to 10,524.80.

Hopes for a Fed pivot evaporated after Chairmen Jerome Powell took to the podium in his press conference following the rate increase announcement. Powell indicated that rates may need to move higher than anticipated.