ASX will slide as Wall Street turns down

Shares gave up early gains and fell in midday Wall Street trading as investors reviewed the latest updates on retail sales, inflation and corporate earnings.

The S&P 500 fell 0.8 percent at midday after rising 0.6 percent earlier in the day. The Dow Jones is down 1.4 percent and the Nasdaq is down 1.1 percent. The Australian stock market is expected to slide, with futures pointing to a fall of 16 points, or 0.2 percent on the open, at 5.03am AEDT. The ASX gained 0.1 percent on Wednesday.

Wall Street lost ground after a positive start to the session.

Wall Street lost ground after a positive start to the session.Credit:AP

Trading has been choppy so far this week after the broader market posted two solid weekly gains.

Technology stocks were among the heaviest weights on the market. Microsoft fell 1.4 percent after becoming the youngest tech company to announce layoffs. The software giant is shedding 10,000 employees, or almost 5 percent of its workforce.

Treasury yields were lower after the government reported that Americans cut spending more than expected last month, the second straight decline. The government also reported more encouraging inflation data. Wholesale prices rose 6.2 percent year-on-year in December, a sixth straight slowdown for the price gauge before being passed on to consumers.

Wall Street has been hoping that easing inflation and a slowdown in economic growth could affect the Federal Reserve’s position on interest rates. The central bank aggressively hiked interest rates throughout 2022 to cool off hot inflation, but that has hurt stock and bond prices and risked going too far and creating a recession.


The two-year Treasury yield, which tracks expectations for future Fed action, fell to 4.11% from about 4.16% just before the latest economic data was released. It was as high as 4.21 percent late Tuesday.

“It looks like something is moving inflation and retail sales in the right direction, ie weaker,” said Tom Martin, senior portfolio manager at Globalt Investments. “The question is what it really means.” ASX will slide as Wall Street turns down

Brian Lowry

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