ASX futures were 13 points, or 0.16% lower, as of 9:00am on Tuesday, suggesting a dip at the open.
US stock futures rose in thin holiday trading after major progress on negotiations to raise the government's debt ceiling over the weekend. Global stock indexes were mixed. US and UK markets are closed Monday for public holidays.
President Biden and House Speaker Kevin McCarthy reached a tentative deal on Sunday to raise the country's debt limit, heading off the risk that the US will default on its debt. Treasury Secretary Janet Yellen warned that without a deal, the government could be unable to pay its bills by June 5.
Commodities and Bonds
Futures for Brent crude slipped around 0.4% to about US$76.70 a barrel. OPEC+ is set to meet June 4 to decide on production plans amid global economic concerns. Gold slipped to US$1,942.00.
The 2-Year Australian Government Bond yield dipped to 3.53% and the 10-Year yield eased to 3.65%. Trading in US bond futures was thin due to the US holiday, though prices of short- and mid-term bonds rose slightly.
One Australian dollar is buying 65.35 US cents.
Asia
Chinese shares ended mixed, with weak post-Covid recovery and limited stimulus dampening sentiment. Automakers, consumption stocks and developers led losses. Notable moves:
- Great Wall Motor -4.4%
- BYD -0.8%
- Yunnan Botanee Biotechnology Group -7.7%
- China Vanke -1.3%
- Huaneng Power International +2.8%
- PetroChina +7.2%
Shanghai Composite +0.3% (3221.45), Shenzhen Composite -0.5%, ChiNext Price Index -1.1%
Hong Kong shares fell for a fourth session due to China's slow recovery, a weak yuan, and limited stimulus. Hang Seng Index -1.0% (18551.11), Hang Seng Tech Index -1.2%
- Tencent -2.85%
- Meituan -8.1%
- BYD Co. -2.05%
- Semiconductor Manufacturing Intl. +2.8%
- PetroChina +2.3%
Japanese stocks rose on the US debt-ceiling deal. Nikkei +1.0% (31233.54), a 33-year high.
- SoftBank Group +8.2%
- Recruit Holdings +2.8%
- Mitsui & Co. +4.0%
- Sumitomo Corp. +4.0%
Europe
European stocks closed slightly lower. Stoxx Europe 600 -0.1% (460.87), CAC 40 and DAX both -0.2%.
The earlier optimism over the US debt ceiling deal faded as markets awaited Congressional approval and assessed future US interest rate risks. Trading volumes were low due to public holidays across multiple countries.
North America
US stock futures rose modestly in thin holiday trading. Markets had rallied Friday on optimism over the debt deal, pushing the S&P 500 and Nasdaq to their highest closes since August.
J.P. Morgan’s Tai Hui cautioned that the deal still needs Congressional approval and that "hard-line Republicans" could vote against it.
The debt ceiling fear had caused a spike in short-term Treasury yields last week, with June 1-maturing bills hitting 7.1% before easing by week’s end.
