Australian shares are set to open higher, after US stocks rallied on cooling inflation data.

ASX futures were up 0.7% or 52 points as of 8:00am on Thursday, suggesting a higher open.

The S&P 500 and the Nasdaq Composite climbed to new records after easing inflation data prompted traders to bolster bets that the Federal Reserve will cut rates this year.

The S&P 500 rose 0.9%, the tech-heavy Nasdaq Composite gained 1.5%, and the Dow Jones Industrial Average edged 0.1% lower, shedding 35 points.

In commodity markets, Brent crude oil was up 0.7% to US$82.48 a barrel, while gold was up at US$2,324.98.

In local bond markets, the yield on Australian 2 Year government bonds was down at 4.02% while the 10 Year yield was also down at 4.28%. US Treasury notes were down, with the 2 Year yield at 4.75% and the 10 Year yield at 4.32%.

The Australian dollar was 66.62 US cents, up from its previous close of 66.60. The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies, was down at 99.50.


Chinese shares closed mixed after May inflation data came largely in line with market expectations. The PBOC may maintain its monetary policy given that price pressures remain weak, UOB economists said in a note. The benchmark Shanghai Composite Index rose 0.3% to 3,037.47 and the Shenzhen Composite Index was up 0.6%. The ChiNext Price Index dropped 0.4%. Energy stocks led gains. China National Offshore Oil Corp. advanced 4.2%, Shaanxi Coal Industry rose 4.8% and China Shenhua Energy gained 2.8%. Meanwhile, insurance stocks led losses, with China Pacific Insurance down 1.0%. Among individual movers, WuXi AppTec rose 6.9% after Wuxi Biologics announced a share buyback late Tuesday.

Hong Kong shares ended lower, with the Hang Seng Index closing 1.3% lower at 17,937.84, as investors wait for U.S. CPI data due later in the day. The Hang Seng Tech index declined 1.7%.Among major stocks, China Evergrande New Energy Vehicle's shares dropped 21% after Chinese authorities ordered the company to repay government subsidies due to its failure to meet contractual obligations. Nio dropped 8.5% and Alibaba Health Information Technology was 6.6% lower. Gainers included ZTE, which was 2.3% higher and Wuxi Biologics, which added 14% after news of its share buyback.

The Nikkei Stock Average closed 0.7% lower at 38,876.71, dragged by real-estate and brokerage stocks as caution prevails over the U.S. monetary policy outlook. Mitsubishi Estate fell 2.9% and Nomura Holdings lost 2.5%. The 10-year Japanese government bond yield was down 3.5 basis points at 0.985%. Investors will be focusing on U.S. inflation data and the Fed rate decision due later in the day.

Indian shares closed slightly higher as investors cautiously eye U.S. CPI data and a Fed decision due later. "While the Fed is not expected to cut, the dot plot and press conference will be closely scrutinised for further clues with regards to when the Fed may move," OCBC said in a research note. Energy and finance stocks led the gains. Power Grid put on 2.5% and NTPC was 1.0% higher. Bajaj Finance added 1.2% and HDFC Bank rose 0.6%. A mixed bag of companies weighed on the market, with automaker Mahindra & Mahindra down 1.3% and consumer goods company Hindustan Unilever dropping 1.0%. The benchmark Sensex index ended 0.2% higher at 76,606.57.


Stocks in the U.K. rose Wednesday, as the FTSE 100 Index increased 0.8% to 8,215.48.

Among large companies, Rentokil Initial PLC was the biggest gainer during the session, surging 14%, and GB Group PLC surged 5.5%. St. James's Place PLC rounded out the top three movers on Wednesday, as shares gained 4.9%.

Legal & General Group PLC posted the largest decline, dropping 5.5%, followed by shares of FirstGroup PLC, which fell 4.4%. Shares of Safestore Holdings PLC fell 4.2%.

In Europe, shares closed higher, with the STOXX Europe 600 Index up 1.1% to 522.89, Germany's DAX adding 1.4% to 18,630.86 and France's CAC 40 gained 1.0% to 7,864.70.

North America

The S&P 500 and the Nasdaq Composite climbed to new records after easing inflation data prompted traders to bolster bets that the Federal Reserve will cut rates this year.

The S&P 500 rose 0.9%, bringing its gains to 14% for the year, while the tech-heavy Nasdaq Composite gained 1.5%. The Dow Jones Industrial Average edged 0.1% lower, shedding 35 points. The yield on the 10-year Treasury note, a benchmark for borrowing costs, slid.

Data released Wednesday morning ahead of the Federal Reserve's policy decision showed inflation cooling in May, and that the slowdown in price pressures was broad-based. The consumer-price index rose 3.3% from a year ago, down slightly from April's reading and lower than the 3.4% economists expected.

"It really couldn't be any better," said Gina Bolvin, president of Bolvin Wealth Management Group. "It's exactly what the Fed wants to see."

Later in the afternoon, Fed officials noted in their June policy statement that there had been modest progress in recent months toward meeting the central bank's goal of 2% inflation. The Fed held interest rates steady as expected, and penciled in one rate cut for this year.

Traders, meanwhile, were still betting on two cuts in 2024 after the Fed's projections were released. Traders priced in a roughly 61% chance the central bank would cut rates at least twice this year, up from 52% a day earlier.

"Having that acknowledgment by the committee that inflation is coming down, moving in the right direction and toward the Fed's 2% target is important," said Quincy Krosby, chief global strategist for LPL Financial.

The prospect of lower rates boosted shares of smaller companies, which tend to direct more of their operating profits toward paying down debt than larger ones. The Russell 2000 index gained 1.6%.

Building products stocks also rallied, with investors betting that lower borrowing costs will lead to more home construction and sales.

Gains in the S&P 500 were led by the index's information technology sector. Apple shares climbed 2.9%.

Oracle shares jumped 13%. The company announced new AI deals with Microsoft, Alphabet and OpenAI late Tuesday.

Traders will get another look at inflation Thursday, when a measure of producer prices is released.