ASX 200 LIVE: ASX to slip, Wall St hovers on US interest rate outlook, Nvidia positioning

Australian shares are poised to open lower. In New York, shares turned down in afternoon trade as volatility persisted amid uncertainty about the path for interest rates and pre-Nvidia earnings nervousness.

Nvidia will report quarterly results after Wednesday’s closing bell (Thursday AEDT). The results “will set the tone for the wider tech sector over the coming few weeks into year-end”, Capital Economics’ Jonas Goltermann said in a note.

The results are poised to generate a potential swing in Nvidia’s shares of 6.5 per cent.

In yet another sign of the market divide on Nvidia and tech valuations, DoubleLine Capital founder Jeffrey Gundlach said he recommends a 20 per cent cash position to hedge against a market implosion — one he sees brewing in unsafe lending to private companies and overblown hopes for artificial intelligence.

As for the US rate outlook, Federal Reserve vice chair Philip Jefferson struck a neutral stance in remarks for a speech, saying labour market risks have been rising, while inflation risks have eased.

“With respect to the path of the policy rate going forward, I will continue to determine policy based on the incoming data, the evolving outlook, and the balance of risks. I always take a meeting-by-meeting approach. This is an especially prudent approach at this time.”

The Fed’s policymakers next meet on December 9-10, with a decision on December 11 AEDT.

Market highlights

ASX 200 futures are pointing down 60 points or 0.7 per cent to 8599.
All US prices near 2.35pm New York time.

• AUD –0.7% to US64.90¢
• Bitcoin -2.2% to $US$92,030
• On Wall St: Dow -1% S&P -1% Nasdaq -1.1%
• VIX +2.37 to 22.20
• Gold -0.3% to $US4072.81 an ounce
• Brent oil -0.2% to $US64.29 a barrel
• Iron ore +1.6% to $US104.25 a tonne
• 10-year yield: US 4.13% Australia 4.27%

Today’s agenda

The RBA will release the minutes from its latest policy meeting. Across the Tasman, the RBNZ is scheduled to release its latest business expectations survey.

eToro’s Farhan Badami on the RBA minutes: ”The RBA’s goal of getting inflation under control is going to take longer than anticipated, with the board likely needing to keep its foot on the brake for longer, putting rate-sensitive sectors under pressure.

“Looking ahead to December’s rate decision, while October’s unemployment rate was a healthy report on paper, it still didn’t provide the signal the RBA is looking for. In fact, it has essentially dampened any chance of an interest rate cut in the near-term, with the data suggesting that businesses are still holding on to staff even as growth slows, keeping wage pressures alive and making it harder for inflation to drift back to the RBA’s 2-3 per cent target.

“Michele Bullock and the board have already been clear that they are in no rush and won’t risk premature easing, even if that means being seen as a Scrooge with December’s rate call. For now, the chance of a Christmas miracle cut for borrowers is near non-existent, and rates are likely to stay on hold until the board gets a clearer sign that inflation is trending lower.”

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