ASX to slip, Wall St lower, RBA rate decision pending

On Wall Street, shares traded in a narrow range; early gains faded though stocks managed to pare most of their losses to end little changed overall to start the month of August.

Boeing rose after a Reuters report the US aviation regulator approved its inspection and modification plan to resume deliveries of 787 Dreamliners.

Of the 283 S&P 500 companies that have reported results, 78.1 per cent have topped profit estimates, as per Refinitiv data. The long-term average is 66.1 per cent.

Citigroup’s Mexican unit, Banamex, is likely to attract offers of about $US7 billion to $US8 billion as the field of bidders narrows, according to people familiar with the matter.

Grupo Financiero Banorte, Carlos Slim’s Grupo Financiero Inbursa, mining tycoon German Larrea and Grupo Financiero Mifel are still in the running, according to the people, who asked not to be identified because the talks are private.

The RBA is expected to lift its key rate by 0.5 percentage point on Tuesday, according to RBC Capital Markets, and again in September, before easing to 0.25 percentage point increases in October and November.

Today’s agenda

Local: June housing finance and building approvals at 11.30am AEST; RBA policy statement at 2.30pm AEST

Overseas data: UK July nationwide house prices

Market highlights

ASX futures down 18 points or 0.26 per cent to 6883 near 6.30am AEST

  • AUD +0.6% to 70.28 US cents
  • Bitcoin -3.1% to $US23,065.37 at 6.27am AEST
  • On Wall St at 4pm: Dow -0.1% S&P500 -0.3%Nasdaq -0.2%
  • In New York: BHP -1.5% Rio -1.3% Atlassian +0.6%
  • Tesla +0.04% Apple -0.6% Amazon +0.3% Microsoft -1%
  • In Europe: Stoxx 50 -0.04% FTSE -0.1% CAC -0.2% DAX -0.03%
  • Spot gold +0.3% to $US1770.42 an ounce at 1.44pm New York time
  • Brent crude -4.2% to $US99.69 a barrel
  • Iron ore -1% to $US112.90 a tonne
  • 10-year yield: US 2.59% Australia 3.05% Germany 0.77%
  • US prices as of 4.27pm in New York

United States

US manufacturing activity slowed less than expected in July and there were signs that supply constraints are easing, with a measure of prices paid for inputs by factories falling to a two-year low, suggesting inflation has probably peaked.

The ISM’s index of national factory activity dipped to 52.8 last month, the lowest reading since June 2020, when the sector was pulling out of a pandemic-induced slump. The PMI was at 53.0 in June. A reading above 50 indicates expansion in manufacturing, which accounts for 11.9 per cent of the US economy.

Economists polled by Reuters had forecast the index would fall to 52.0. A reading above 48.7 over a period of time generally indicates an expansion of the overall economy.

Four of the six biggest manufacturing industries – petroleum and coal products as well as computer and electronic products, transportation equipment and machinery – reported moderate-to-strong growth last month.


European shares edged down on Monday, dragged lower by energy stocks amid fears of a global economic slowdown fanned by disappointing Chinese economic data and figures showing contraction in euro zone manufacturing activity.

The pan-European STOXX 600 slipped 0.1 per cent after a choppy trading day, reversing slim earlier gains.

Energy stocks shed 1.5 per cent, snapping six straight days of gains, as crude prices dropped sharply after the weak factory data renewed demand concerns.

Meanwhile, euro zone unemployment was steady at 6.6 per cent of the workforce in June, the European Union’s statistics office said, in line with market expectations.

Heineken NV slipped 0.4 per cent as the world’s second-largest brewer shelved its margin target for 2023 as costs spiked.

Pearson jumped 12.7 per cent to top the benchmark index after the British education group reiterated its full-year profit outlook.

Other boosts came from banking stocks after London-listed HSBC jumped 6.1 per cent on a profit beat and prospects for chunkier dividends.


Iron ore prices edged higher on Monday, extending last week’s solid gains and spurred by hopes of increased infrastructure spending and prospects of property sector bailouts in China.

Uninspiring factory activity data capped gains, however.

The most-traded iron ore contract on China’s Dalian Commodity Exchange, for September delivery, ended daytime trade 0.8 per cent higher at 787 yuan ($US116.55) a tonne, after touching its strongest level since June 30 at 817.50 yuan.

On the Singapore Exchange, the steelmaking ingredient’s September contract was up 1.2 per cent at $US116.40 a tonne at 0718 GMT, off a session high of $US120.95.

Benchmark copper on the London Metal Exchange (LME) was down 1.3 per cent at $US7818 a tonne at 1616 GMT after touching $US7970 for its highest since July 5.

Gold neared a one-month high on the back of a decline in the US dollar, with investors awaiting economic data that could influence the path of Federal Reserve policy tightening.

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