Overnight, global markets rallied, boosting hopes of an interest rate cut by the Reserve Bank of Australia. The positive performance of US equities, despite mixed sector results, combined with a weaker US dollar and the European Central Bank’s rate cut, has set a positive tone for the ASX.
US Markets
US stocks climbed on Thursday, logging gains in a volatile session as investors assessed earnings from major tech firms.
The Dow Jones Industrial Average rose 168.61 points, or 0.38%, to close at 44,882.13 after gaining nearly 300 points at its session high. The S&P 500 added 0.53% to 6,071.17, while the Nasdaq Composite advanced 0.25% to 19,681.75.
Markets pared gains late in the session after President Donald Trump announced plans to impose 25% tariffs on imports from Canada and Mexico.
Meanwhile, Wall Street digested fresh quarterly results from several megacap tech firms. Meta Platforms and Tesla gained 1.6% and 2.9%, respectively, following earnings reports. Microsoft, however, fell 6.2% after issuing a disappointing revenue forecast. Meta exceeded expectations on both revenue and earnings, while Tesla shrugged off weaker-than-expected results.
Gold
Gold prices surged over 2% overnight, driven by the weakening US dollar.
US Dollar
The US dollar weakened against other currencies, including the Australian dollar.
European Central Bank
The European Central Bank lowered its key interest rate and hinted at further easing. This move has strengthened expectations of a similar decision by the Reserve Bank of Australia, potentially boosting the ASX.
ASX Futures
ASX futures point to a positive opening, fuelled by global market optimism and rate cut expectations. The SPI futures are pointing to 0.4% rise.
Quarterly Results
Several Australian companies, including Origin Energy, Syrah Resources, Resmed, and Champion Iron, are set to release quarterly results.