Stan Choe
US stocks are drifting near their records in mixed trading after trading resumed following a three-day weekend for Wall Street.
The S&P 500 slipped 0.3 per cent, coming off its 11th winning week in the last 12, and pulled 1.7 per cent below its all-time high set early this month. The Dow Jones was up 161 points, or 0.3 per cent, and the Nasdaq composite was 1 per cent lower.
The Australian sharemarket is set to rise, with futures at 4.53am AEST pointing to a gain of 23 points, or 0.3 per cent, at the open. The ASX slid 0.1 per cent on Monday. The Australian dollar is weaker at US70.00¢.
In the oil market, prices eased following talks over the weekend between the United States and Iran on their war. US Vice President JD Vance said they created a “good foundation for a successful final deal.”
An end to the war could clear the Strait of Hormuz for oil tankers and allow for the undisputed resumption of deliveries from the Persian Gulf. Iran’s military had said Saturday that it closed the Strait of Hormuz again, though US Central Command has disputed that.
The price for a barrel of Brent crude oil fell 3.5 per cent to $US77.71, closer to its roughly $US70 price from before the war. Benchmark US crude oil fell 2.6 per cent to settle at $US73.86 per barrel.
The lower oil prices, though, did not pull down Treasury yields in the bond market. Yields have been climbing because of speculation that the Federal Reserve may have to hike interest rates this year in order to keep a lid on inflation, which has been accelerating because of expensive oil caused by the Iran war. Economists expect a report on Thursday to show a measure of inflation for US consumers sped up to 4.1 per cent in May from 3.8 per cent in April.
The yield on the 10-year Treasury climbed to 4.51 per cent from 4.46 per cent late Thursday and from just 3.97 per cent before the war.
Traders are betting on a 90 per cent chance the Fed will raise its federal funds rate at least once by the end of the year, with a small minority calling for four increases. That’s up from the 57 per cent chance seen just a week ago, according to data from CME Group.
High yields in bond markets worldwide caused by worries about inflation are threatening to slow economies and have already sent rates higher for mortgages and other kinds of loans. High yields also hurt prices for investments, particularly those seen as the most expensive. That raises the pressure on companies that have soared in the mania around artificial-intelligence technology.
SpaceX fell 10.6 per cent to drop toward $US165. It’s heading toward a third straight loss following a big three-day run since its ballyhooed debut on the US stock market, when it initially sold its stock at $US135 per share.
Elsewhere on Wall Street, AbbVie climbed 6.7 per cent after saying it agreed to buy Apogee Therapeutics and its potential treatments for patients with dermatologic, respiratory and other related inflammatory and immunological diseases. Apogee Therapeutics soared 46.7 per cent following the announcement of the deal, valued at roughly $US10.9 billion ($15.6 billion).
Tributes to former Federal Reserve Chairman Alan Greenspan poured in after the news of his death early Monday, many from former colleagues and market players who had a front-row seat during his 18-year tenure atop the US central bank.
Several described him as a driving force for change at the Fed and a guiding light for investors — in his own inscrutable way — even as his ultimate legacy is clouded by the 2008-09 global financial crisis.
Policymakers and staffers who worked with Greenspan noted how his tenure spanned a period of significant economic change, from an era of high inflation to an economy powered by technology. Greenspan led the Fed from 1987 until 2006 and died on Monday at his home in Washington.
In stock markets abroad, the United Kingdom’s FTSE 100 rose 0.7 per cent after Keir Starmer said he was stepping down as leader of the governing Labour Party and will leave office within weeks.
In Asia, Tokyo’s Nikkei 225 jumped 1.5 per cent and ended at another all-time high, led by AI stocks. South Korea’s Kospi gained 0.7 per cent to its own record, helped by AI-related companies.
With AP, Bloomberg
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Disclaimer : This story is auto aggregated by a computer programme and has not been created or edited by DOWNTHENEWS. Publisher: www.smh.com.au
