Aussie market to open in the green. Myer rises despite mixed trading update

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The Australian share market is set to open higher on Wednesday, following a mixed session on Wall Street and strong gains in major US tech stocks.

At 6:30 AM ET (10:30 GMT), the Dow Jones Industrial Average futures were trading 80 points, or 0.2%, lower, while the broader S&P 500 futures fell 0.1% and the Nasdaq 100 futures advanced 0.4%.

The Dow Jones Industrial Average is expected to open Wednesday’s session at 33,890, the S&P 500 at 4,378 and the Nasdaq 100 at 15,320.

The major US stock indexes closed with modest gains on Tuesday, extending rallies from the previous session as traders assessed interest rate expectations and digested mixed economic data.

Tech stocks, however, continued to soar, with the major US tech companies pushing the Nasdaq to close with a gain of 1.3%.

Among individual stocks, Myer (ASX:MYR) will be in focus after the department store chain reported a 3.4% rise in third-quarter sales and announced plans to open two new stores in New South Wales.

However, the company’s net profit declined by 60% to $14.7 million for the 24 weeks ended December 24, 2023, compared to $37.3 million a year earlier.

The company attributed the profit decrease to increased operating expenses and higher inventory levels.

Meanwhile, the US economy contracted more sharply than expected in the fourth quarter, according to a preliminary estimate.

Real gross domestic product decreased at an annualized rate of 2.4% in the period, compared to economists’ anticipations of a 2.3% decline and the third quarter’s revised reading of 2.7%.

This downturn was attributed to a substantial reduction in government spending and a decline in private inventory investment.

Additionally, consumer spending, which usually contributes significantly to economic growth, slowed more than anticipated.

However, business fixed investment rebounded strongly, and labor income increased at a healthy pace.

At 5:00 PM ET (09:00 GMT), the Federal Reserve is set to release the minutes of its December 13-14 policy meeting.

These minutes are expected to provide further insights into the Fed's thinking on the potential for a pause in the current rate hike cycle.

The dot plot from the December meeting indicated that officials anticipate the federal funds rate to peak in the 5-5.25% range this year, which is consistent with a final 25-basis point rate hike at the upcoming January meeting.

However, the officials' individual year-end economic forecasts varied significantly, suggesting that the path of monetary policy remains uncertain.