ASX to rise, Wall St higher after Trump denies plan to fire Powell
The S&P 500 slumped early on reports the president was likely to seek the Fed chairman's ouster soon. Trump told reporters attending a White House event that he is 'not planning on doing anything' to remove Powell.
'Powell's removal is viewed by markets as a low-probability but high-impact event,' TD Securities said in a note. 'We would expect markets to price in higher long-run inflation, higher term premium, more near-term Fed rate cuts (and hence lower front-end rates), increased market volatility, and a steeper yield curve.'
TD also said a shadow Fed chairman could be the next big worry for the US dollar, especially given the financing risks of the widening fiscal deficit.
Market highlights
ASX futures are pointing up 53 points or 0.6 per cent to 8588.
All US prices as of 4.20pm New York time.
Today's agenda
The key focus is the June labour force report at 11.30am AEST. NAB said it expects employment growth of +20k and for the unemployment rate to remain at 4.1 per cent.
TD Securities said a negative May jobs report didn't faze the RBA much as the bank chose to surprise with an on-hold decision as the Board placed more emphasis on inflation. 'However, another weak jobs report should nudge the bank to go ahead with a cut in August. We expect jobs to print at +15k which should push the unemployment rate to 4.2 per cent, assuming the participation rate remain at 67 per cent.
Quarterly reports are expected on Thursday from Santos, Yancoal Australia as well as Alcoa, Gold Road Resources and Genesis Minerals.
Later in the day, at 10.30pm, the US will release weekly initial jobless claims and June retail sales.
Top stories
Chanticleer: Why there's so much at stake for NAB and its CEO Andrew Irvine | Institutional investors are overweight NAB and nervous about what they're seeing in four key areas: leadership, competition, asset quality and costs.
The 10 wealthiest executives in the ASX 300 revealed | Healthcare and tech company bosses, including the co-founders of the ASX's newest $30 billion company Pro Medicus, dominate the Rich Bosses list.
From farmer to miner, Rio's new CEO is a breath of fresh air | When Simon Trott's parents installed air conditioning in their shearing sheds, their son learnt how to get the best out of staff. Now he has 60,000 of them.
Will equity analysts be replaced by AI? That's a billion-dollar question | With disruption upon them, fund managers and investment banks, including Macquarie, are trying to get ahead of the trend, writes Joyce Moullakis.
Is that 1 or 7? What the judge will have to decide in Bradfield | Liberal Gisele Kapterian alleges 'illegal practices' in her 26-vote loss in the election, and wants a judge to rule on the squiggles on 151 questionable ballots.
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