Markets Overview

  • ASX SPI 200 futures up 0.2% to 8,611.00
  • S&P 500 little changed at 6,847.67
  • Dow Average down 0.2% to 47,624.59
  • Aussie up 0.2% to 0.6639 per US$
  • US 10-year yield rose 1.8bps to 4.1819%
  • Australia 3-year bond yield rose 10 bps to 4.14%
  • Australia 10-year bond yield rose 5.5 bps to 4.76%
  • Gold spot up 0.5% to $4,212.67
  • Brent futures down 0.7% to $62.06/bbl

Economic Events

  • 11:00: (AU) Australia to Sell A$1 Billion 1% 2030 Bonds

Australia’s social media ban for youths took effect Wednesday, a landmark move that’s drawn global attention at a time governments are increasingly enacting rules to shield minors from toxic content and cyberbullying.

With less than 24 hours to go until the Federal Reserve’s final interest-rate decision of 2025, Wall Street traders put off placing big bets as they waited for clues to the central bank’s path for next year.

The S&P 500 ended Tuesday’s session little changed after JPMorgan Chase & Co. warned about higher-than-expected costs and called consumers “fragile.” The lender fell more than 4%. The blue-chip Dow slid while the Nasdaq 100 made a small advance. The rate on 10-year Treasuries hovered at around 4.19% following a government bond auction, while the dollar was little changed and Bitcoin climbed.

In late trading, shares of GE Vernova Inc. rose more than 6% after the US manufacturer doubled its dividend and increased its scope for share buybacks while raising earnings projections amid soaring demand for electricity.

Money markets are pricing around two cuts in 2026 after a likely quarter-point reduction tomorrow — a retreat from more optimistic forecasts in recent weeks. Many market watchers, including Tom Essaye, are worried about the risk of a hawkish cut, where the Fed lowers interest rates but signals it’s done with rate cuts for the moment.

“It’s not too much of an exaggeration to say that the rate cut is actually the least important part of this meeting,” said the founder of The Sevens Report. The market “cares much more that the Fed signals it will continue to cut rates and does not signal a pause in the rate-cut cycle.”

Kevin Hassett, the frontrunner in President Donald Trump’s search to replace Fed Chair Jerome Powell, said at an event Tuesday that he sees plenty of room to substantially lower rates, even more than a quarter-point cut.

“If the data suggests that we could do it, then — like right now — I think there’s plenty of room to do it,” he said during the Wall Street Journal CEO Council Summit.

While Powell’s successor remains up in the air, a dayslong slump in US government bonds continued unabated. Traders have grown cautious about the pace of monetary easing beyond Wednesday’s meeting. For now, the Fed’s decision and its guidance for 2026 remain the key focus for traders as markets made incremental moves.

The Treasury Department’s monthly auction of 10-year notes at 1 p.m. New York time drew a yield of 4.175%, matching the level indicated by trading just before the bidding deadline, when it was about a basis point higher on the day.

Small stock gains from stale data, delayed by a government shutdown, didn’t hold. Equities had initially risen after better-than-expected job openings data for October. The number of available positions climbed to 7.67 million, a Bloomberg survey of economists called for 7.12 million.

“It’s hard to read too much into the JOLTs report – the outperformance in job openings is ostensibly hawkish (which is why yields turned higher on the release), but the pace of layoffs rose too,”said Vital Knowledge’s Adam Crisafulli.

US stocks may turn more volatile after tomorrow’s meeting than after other recent decisions, with Bloomberg options data showing an implied move of 0.7% in either direction. A hawkish cut is likely to trigger volatility, but the market could reset expectations after that.

“If the Fed is too hawkish, we expect the White House to soon announce Powell’s replacement,” said Fundstrat’s Tom Lee. That would be a “market clearing event,” in his view.

Globally, government debt markets have been under pressure as central bankers signal that their easing cycles are coming to an end. On Tuesday, Australia’s Michele Bullock declared her country’s easing phase over, following comments from the European Central Bank’s Isabel Schnabel that she’s comfortable with the next move being higher. The Bank of Japan is expected to hike next week.

“Given all the tension in global bond markets at the moment, the meeting of the Fed could potentially add fuel to the fire,” said Vincent Juvyns, chief investment strategist at ING in Brussels. “Investors will also be watching very closely the results of Oracle and Broadcom. There’s a lot at stake this week.”