Australian shares are set to open higher, after Wall St continued to rise for the month.

ASX futures were up 0.3% or 21 points as of 8:00am on Wednesday, suggesting a higher open.

US stocks rose again Tuesday, keeping a May rally intact.

The S&P 500 advanced 0.3% to close at a fresh record. The Nasdaq Composite also reached a new high, rising 0.2%. The Dow Jones Industrial Average gained 0.2%, or 66 points. All three indexes are up 5.4% or more for the month so far.

In commodity markets, Brent crude oil was down 1.4% to US$82.53 a barrel, while gold was down 0.2% at US$2,421.05.

In local bond markets, the yield on Australian 2 Year government bonds was up at 3.95% while the 10 Year yield was also up at 4.25%. US Treasury notes were down, with the 2 Year yield at 4.83% and the 10 Year yield at 4.41%.

The Australian dollar was 66.64 US cents, down from its previous close of 66.66. The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies, was down at 99.25.


Chinese shares ended lower, dragged by commodity and mining stocks. The positive sentiment boosted by the recent property stimulus has started to fade. Shandong Gold Mining and Zijin Mining fell 5.35% and 4.2%, respectively. Zhongjin Gold Corp. lost 3.8%. Meanwhile, the bank sector gained with the Bank of Nanjing and Bank of Chengdu up 1.9% and 1.65%, respectively. China Vanke closed 0.1% higher after it obtained a CNY1.2 billion loan from the Bank of China. The benchmark Shanghai Composite Index closed 0.4% lower at 3157.97, the Shenzhen Composite Index was down 0.75% and the ChiNext Price Index dropped 0.8%.

Hong Kong shares ended lower amid profit-taking. However, HSBC analysts reckon Chinese stocks could rise further amid potentially more share buybacks and interest rate cuts. "Much of the buying in Hong Kong has been from mainland China, which suggests global funds still have room to buy more," they added. Li Auto, which fell 19% after its weaker-than-expected 1Q results, weighed on the index and dragged down investor sentiment. Among other carmakers, BYD dropped 4.4% and XPeng was down 10.5% ahead of its 1Q results due after the market close. Pharmaceutical companies fell broadly as well, with JD Health International down 8.4%. The benchmark Hang Seng Index ended 2.1% lower at 19220.62, and the Hang Seng Tech Index dropped 3.7%.

Japanese stocks ended lower, dragged by falls in real-estate and machinery stocks, amid continued concerns about higher borrowing costs. Sumitomo Realty & Development declined 2.4% and Daikin Industries dropped 4.7%. The Nikkei Stock Average fell 0.3% to 38946.93. The 10-year Japanese government bond yield rose half a basis point to 0.980%, a new high since May 2013. Investors are focusing on economic data and their policy implications.

Indian shares ended slightly lower, dragged by tech and consumer stocks. Infosys fell 0.7% and Nestle India shed 1.6%. Delhivery dropped 10% after it posted a 4Q net loss. Astral lost 5.25% after its 4Q net profit dropped 12% on year. Gainers included Tata Steel, which added 3.8%, and Power Grid Corp. of India, which rose 2.7%. Earnings remained in focus. The benchmark Sensex edged 0.1% lower to 73953.31.


Stocks in the U.K. slipped Tuesday, as the FTSE 100 Index dropped 0.1% to 8416.45.

Among large companies, SSP Group PLC posted the largest decline, dropping 9.0% to GBP190.00, followed by shares of Dowlais Group PLC, which dropped 6.1% to GBP72.15. Shares of Pennon Group PLC dropped 5.2% to GBP679.50.

Big Yellow Group PLC was the biggest gainer during the session, gaining 4.9% to GBP1,238.00, and Hargreaves Lansdown PLC gained 4.2% to GBP932.80. Schroders PLC rounded out the top three movers on Tuesday, as shares gained 3.9% to GBP384.80.

In Europe, shares closed lower, with the STOXX Europe 600 Index down 0.2% to 522.95, Germany's DAX also losing 0.2% to 18,726.76 and France's CAC 40 dropped 0.7% to 8,141.46.

North America

Stocks rose again Tuesday, keeping a May rally intact.

The S&P 500 advanced 0.3% to close at a fresh record. The Nasdaq Composite also reached a new high, rising 0.2%. The Dow Jones Industrial Average gained 0.2%, or 66 points. All three indexes are up 5.4% or more for the month so far.

Stocks have rallied in recent weeks on renewed confidence among investors that inflation is easing and that the Federal Reserve will cut interest rates this year. Surprisingly strong corporate earnings have also boosted spirits on Wall Street: S&P 5OO companies have grown profits by 5.7% from a year ago as of Friday, according to FactSet.

"Stocks have become a buy high, sell higher asset class," said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management. He said high prices are warranted because data on inflation, corporate profits and the expected path of interest rates are all heading in encouraging directions.

Data last week showed that a key measure of consumer-price inflation rose in April at the slowest pace since 2021. Retail sales for the month, meanwhile, held steady from March. That has helped boost confidence that the economy is cooling, without any signs that it will tip into a severe slowdown.

The benchmark 10-year Treasury yield settled at 4.414% Tuesday, down from 4.436% on Monday. The yield had climbed as high as 4.706% in April after a string of hotter-than-expected inflation reports.

The economic backdrop "has been more agreeable to what the Fed wants to get done," said Rob Williams, managing partner at Sage Advisory. "It's at least pointing to a little more dovish outcome than where we were headed."

Though most on Wall Street expect a rate cut this year, the exact timing is uncertain. Federal Reserve governor Chris Waller said Tuesday that the central bank has made progress on inflation. But Waller also said that several more months of weakening inflation data are needed before the Fed will move to cut rates.

Some investors also say high stock prices could leave the market vulnerable to a sharp selloff if data on the economy takes an unexpected turn for the worse.

The S&P 500 trades at 20.8 times its projected earnings over the next 12 months, according to FactSet. The five-year average is 19.6 times.

For the year, the benchmark index is up 11.6%.

"If you want to look for reasons for bearish sentiment, they're there, but I can't call them a base case," said Dana D'Auria, co-chief investment officer and group president at Envestnet Solutions.

Among individual stocks, shares of Lowe's fell 1.9% Tuesday, after the home-improvement retailer reported a decline in sales. Macy's stock rose 5.1% after it boosted its profit forecast.

Investors on Wednesday will get an update on the market's hottest tech company when chip maker Nvidia reports results after the market closes. Analysts polled by FactSet expect Nvidia to report revenue of $24.6 billion and profit of $5.19 a share.