ASX futures were 3 points lower at 7127 at 7am AEST on Thursday.
In the final hour of trading, the S&P 500 was 0.67% lower, while the technology-heavy Nasdaq Composite Index fell 1.3%. The Dow Jones Industrial Average was unchanged.
Wednesday’s data showed that even with the Fed’s aggressive rate increases, US retail sales were 1.3% higher than during the previous month.
And in commodity markets, Brent crude oil dropped 1 per cent to $US92.91 a barrel, gold was 0.3% lower at US$1,773.87.
On Australian bond markets, two-year government bond yields fell to 3.15 per cent and 10-year bonds dropped to 3.72 per cent. Abroad, 2 Year US Treasury notes were yielding 4.37% and 10 Year US Treasury notes 3.7%.
The Australian dollar fell to 67.36 US cents. The Wall Street Journal Dollar Index, which measures the U.S. currency against 16 others, rose to 99.17.
Asia
Shares Mostly Fallen Across Asia
Asian shares were lower on Wednesday as investors grew jittery after Poland said a Russian-made missile killed two people within its borders.
Stock benchmarks dropped in Tokyo during morning trading before rebounding. The Nikkei 225 Index finished Wednesday’s session 0.14% higher. Indexes in, and both fell. The Hang Seng Index fell 0.47 percent and the Shanghai Composite was 0.45 percent lower.
“Asian equities were on the defensive this Wednesday as geopolitical concerns dictated market movements,” Anderson Alves at ActivTrades told AP News.
“Sentiment is waiting for fresh views on the geopolitical side direction for risk assets. If there is any sign of things escalating further in such an unstable situation, it’s possible here that you see a market-wide response,” he said.
Europe
European stocks dropped as traders weighed corporate earnings, economic data, and the geopolitical backdrop. The pan-European Stoxx Europe 600 was down 0.98%, the German DAX fell 1% and the French CAC 40 was 0.5% lower.
In London, the FTSE 100 ended the day 0.2% lower, amid the geopolitical uncertainty caused by the reported landing of Russian-made missiles in Poland. An above-forecast U.K. inflation figure also gave a further indication “that continued sticky inflation was also likely to act as a significant drag on future earnings potential, not only in the U.K., but also in Europe where it is just as high, and in many cases a lot higher,” said Michael Hewson, a CMC Markets analyst, in a note.
Ocado was the heaviest faller on the index, sliding 5.7%, followed by Rightmove and Rolls-Royce, which fell 4.5% and 4.3% respectively. The Sage Group was the biggest riser, up 7.3%, followed by BAE Systems, up 4.2%, and Haleon, up 3.2%.
North America
The United States markets weakened on Wednesday, as investors fretted over how the Federal Reserve would act on interest rates. Retail sales data was stronger than expected.
With an hour remaining in the trading day, the S&P 500 was 0.67% lower, and the Nasdaq Composite Index, which is heavy on technology shares, fell 1.3%. The Dow Jones industrial average was flat.
Data on Wednesday indicated US retail sales were up 1.3% from the prior month, despite the Fed’s aggressive interest-rate hikes.
“Some of what’s underpinning the strength in retail sales, relative to some of the releases on the earnings side, is it’s not an inflation-adjusted series,” Ian Lyngen, head of U.S. rates strategy at BMO Capital Markets (TSE:BMO) told the Wall Street Journal. “Yes, prices are higher, and that’s leading to higher nominal sales. But actually, in real terms it is not as strong as the headlines would suggest.”
Defensive groups such as consumer staples, utilities, and health care were the most profitable segments of the market. Stocks of technology and consumer discretionary companies that are more sensitive to the outlook for economic growth had the sharpest declines, falling 1.5% and 1.3%, respectively.
Cryptocurrency prices inched lower as the fallout from the FTX saga. Bitcoin fell 2% to $16,454 from its 5 p.m. ET level.
