Gross domestic product increased at a 2.1 per cent annualised rate last quarter, the government said in its second estimate of GDP for the April-June period. That was revised down from the 2.4 per cent pace reported last month. Economists polled by Reuters had expected GDP for the second quarter would be unrevised.
The yield on the US 10-year note was 1 basis point lower to 4.11 per cent at 2.36pm in New York.
Swap contracts tied to Fed meeting dates priced in less than a 50 per cent chance of another quarter-point rate increase this year, Bloomberg reported. As recently as Tuesday — before the release of weaker-than-expected gauges of job openings and consumer confidence — a hike was given a probability of about 75 per cent.
On Wall Street, shares were modestly higher in afternoon trade with the focus on pending income, spending and Core PCE data this evening AEST and on Friday night’s AEST jobs report.
China is set to release key August data late Thursday morning. Here’s what TD Securities is anticipating: “We expect China’s manufacturing PMI to weaken in Aug and stay in contraction for the 5th straight month at 49.0 (consensus: 49.1, July: 49.3).
“Manufacturers are probably disappointed given the lack of concrete policy support measures since the July Politburo meeting while poor credit growth numbers and slower industrial production growth reflect the lack of activity in the manufacturing sector.
“Similarly, we expect the non-manufacturing PMI to extend its decline to 50.8 (cons: 51.3, last: 51.5) with consumers staying cautious on spending amid the heightened uncertainty over the economic outlook, evident from the dismal July retail sales performance,” TD said.
“Overall, we expect another poor set of PMIs which is likely to reinforce the bearish China narrative and should reinforce authorities taking quicker and bolder policy action to drive a turnaround in sentiment.”
Today’s agenda
Local: Private sector credit July and private CAPEX second quarter at 11.30am
Overseas data: NZ August ANZ business confidence at 11am; China August PMIs at 11.30am; Japan July industrial production; Eurozone preliminary August CPI and July unemployment rate at 7pm; US July personal income, spending and Core PCE at 10.30pm
TD Securities on Eurozone’s CPI: “We look for both euro area headline and core inflation to edge down in August, with the former falling 0.1ppts to 5.2% y/y (mkt: 5.1%) and the latter coming in at 5.3% y/y (mkt: 5.3%).”
Other top stories
Blackout warnings sharpen as El Nino summer looms The latest 10-year outlook from the Australian Energy Market Operator has grim warnings about potential blackouts on the east coast as hot summers return.
Burke to exclude overtime, rosters from gig economy laws The government will empower workers to challenge “unfair deactivations” and set minimum conditions, but its new laws will specify what is in and what is out.
Market highlights
ASX futures down 13 points or 0.18% to 7246 near 4.30am AEST
- AUD -0.1% to 64.75 US cents
- Bitcoin -2.8% to $US27,201 at 4.44am AEST
- On Wall St at 2.45pm: Dow +0.1% S&P +0.4% Nasdaq +0.6%
- In New York: BHP +0.5% Rio +0.5% Atlassian +1.2%
- Tesla -0.6% Apple +1.5% Alphabet +0.8%
- Stoxx 50 -0.3% FTSE +0.1% CAC -0.1% DAX -0.2%
- Spot gold +0.3% to $US1943.52/oz at 2.37pm in New York
- Brent crude +0.3% to $US85.70 a barrel
- Iron ore +2% to $US114.45 a tonne
- 10-year yield: US 4.11% Australia 4.07% Germany 2.54%
- US prices as of 2.36pm in New York
United States
US GDP revised down to a 2.1pc annual rate The US economy continues to show resilience in the face of higher borrowing costs.
Apple is testing the use of 3D printers to produce the steel chassis used by some of its upcoming smartwatches, Bloomberg reported, heralding a major change to how the company manufactures products.
The technique would obviate the need to cut large slabs of metal into the product’s shape. That would reduce the time it takes to build devices while also helping the environment by using less material, according to the people, who asked not to be identified because the plan is private.
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American Airlines Group flight attendants gave their union leaders approval to trigger a strike if the labour group is eventually allowed to end contract negotiations under federal labour law, the Association of Professional Flight Attendants said.
The so-called strike authorisation was approved by more than 99 per cent of flight attendants voting, the union told members as they picketed Wednesday at Dallas-Fort Worth and other airports across the carrier’s network.
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US regulators are quietly demanding that regional lenders shore up their liquidity planning, part of a ramp-up in efforts to tighten supervision in the wake of three bank failures earlier this year.
The Federal Reserve has issued a slew of private warnings to lenders with assets of $US100 billion to $US250 billion, including Citizens Financial Group, Fifth Third Bancorp and M&T Bank Corp, Bloomberg reported.
Commodities
Gabon military coup sparks concern at Fortescue The mining giant has raced to ensure the safety of staff at its fledgling iron ore mine, but won’t be drawn on any potential longer-term implications.
Albemarle boss still in the market for Liontown As far as Albemarle boss Kent Masters is concerned, the $5.5 billion bid for Liontown is still live despite no talks between the parties for months.
