Australian shares are set to open flat, as US investors digest inflation data.

ASX futures were down 0.01% or 1 point as of 8:30am on Wednesday, suggesting a flat open.

US stocks rose as November inflation came in mostly as expected ahead of the Fed's interest rate decision tomorrow.

DJIA gains 173 points to 36577, the S&P 500 rises 0.5% to 4643 and the Nasdaq adds 0.7% to 14533.

In commodity markets, Brent crude oil fell 3.5% to US$73.39 a barrel while gold was down 0.1% to US$1,979.71.

In local bond markets, the yield on Australian 2 Year government bonds was down at 4.03% while the 10 Year yield was also down at 4.32%. US Treasury notes were mixed, with the 2 Year yield up at 4.73% and the 10 Year yield down at 4.20%.

The Australian dollar hit 65.52 US cents down from the previous close of 65.67. The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies, was down at 98.08.


Chinese shares closed mixed as investors awaited the Fed's policy decision and possible stimulus measures from Beijing after recent meetings by officials. The Shanghai Composite Index closed 0.4% higher at 3003.44, taking the benchmark index above the key 3000 level. The Shenzhen Composite Index rose 0.15% to 1868.10, while the ChiNext Price Index fell 0.6%. The property sector led gains. Poly Developments & Holdings Group advanced 7.6% and Beijing Urban Construction Investment & Development climbed 4.7%. Construction-material stocks also rose, with Anhui Conch Cement gaining 1.3%. Medical shares led declines. Eyebright Medical Technology Beijing shed 2.5% and Beijing Balance Medical Technology fell 1.4%.

Hong Kong shares closed higher amid strong buying in property and tech names. The benchmark Hang Seng Index advanced 1.1% to 16374.50 and the Hang Seng Tech Index rose 1.7%. Investors saw positive signs in southbound net inflows that hit record levels for two consecutive days, said Sonija Li, head of retail research at Maybank. Bargain hunting with the index at a two year low could be another reason, Li added. The Hang Seng Mainland Properties Index rose 4.5%, as Longfor Group gained 4.9% and Country Garden Services added 3.9%. Tech companies Xiaomi and advanced 4.1% and 2.9%, respectively. Li Ning closed 4.4% higher after it announced a share buyback. Among the few losers, WuXi AppTec fell 1.1%, AIA shed 1.1% and China Shenhua Energy lost 0.8%.

The Nikkei Stock Average edged 0.2% higher to close at 32843.70, paring earlier gains. Investors appear to be looking cautiously toward meetings of central banks such as the Fed and their respective outlooks for policy heading into 2024, Michael Hewson, chief market analyst at CMC Markets, says in an email. Among the best performers on the Japanese benchmark index is Renesas Electronics, which rose 4.4%. Screen Holdings added 3.05%, while Fujitsu was up 2.4%. USD/JPY was at 145.40, compared with 145.60 as of Monday's Tokyo stock-market close. The 10-year JGB yield was down 4 bps at 0.735%.

Indian shares ended lower, pulling back from Monday's record close as bank and pharmaceutical stocks weighed. The focus for investors this week is key inflation data out of the U.S. and India and the Fed's final rate decision of the year. The benchmark Sensex fell 0.5% to 69551.03, its biggest percentage drop since late October. Sun Pharmaceutical Industries led losses, declining 1.9%. IndusInd Bank and Kotak Mahindra Bank fell 1.7% and 1.05%, respectively. UltraTech Cement was among the few gainers, rising 1.9%. JSW Steel added 1.1%.


European stocks fell after US inflation broadly matched expectations and UK wage gains eased. The Stoxx Europe 600 dropped 0.2%, the CAC 40 slipped 0.1% and the FTSE 100 and DAX closed just below their opening levels. Oil shares retreat as Brent crude backtracks 3.7% to $73.25 a barrel. "The US CPI figure came in largely as expected," Ryan Brandham at Validus Risk Management wrote. "The market is already pricing in over four interest rate cuts in 2024. However, considering core CPI remains at 4%, there's risk these cuts may not come as rapidly as the market expects."

The FTSE 100 edged lower on Tuesday, by 0.03% at 7,542.77 points, with today's U.S. inflation data unable to provide any further impetus ahead of tomorrow's Federal Reserve meeting. Leading the fallers was Hargreaves Lansdown, down 6.7% after the U.K. Financial Conduct Authority penned a letter to investment platforms and money managers raising concerns over earned interest on client accounts. Shares in Abrdn and AJ Bell also took a tumble as a result. "Today's move appears to be kneejerk in nature as none of the companies indulge in the behaviour that the FCA is most concerned about," CMC Markets UK analyst Michael Hewson says in a market comment. Sterling fell against the euro after annual gains in UK employees' average total pay, including bonuses, between August-October slowed to 7.2%.

North America

US stocks rose as November inflation came in mostly as expected ahead of the Fed's interest rate decision tomorrow.

DJIA gains 173 points to 36577, the S&P 500 rises 0.5% to 4643 and the Nasdaq adds 0.7% to 14533.

Investors expect inflation data will continue to show a soft landing for the economy will allow the central bank to hold rates steady through the middle of next year before they start to loosen policy.

Oracle shares slide 12% after its revenue missed Wall Street's expectations on Monday.

Oil prices fall to their lowest level in five months on demand worries, while the dollar and Treasury yields fall following the inflation data.