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Patient Fed disappoints investors

The US Federal Reserve kept interest rates on hold and maintained its neutral stance, re-iterating patience. Recent robust GDP and employment data contrasted with a weaker inflation read. Both the US dollar and bond markets retraced early moves to finish largely unchanged.

US stocks sold off from record levels, suggesting some investors had pinned hopes on a more accommodative stance. ISM readings showed manufacturing, employment, prices and new orders all declined in April, adding weight to the selling. The gloomy trading came despite the company-reporting season hitting the two third mark with earnings running ahead of forecasts.

The Asia Pacific region is looking at further muted trading as key centres remain holiday affected.

The Australian share market is set to open lower. Negative share market leads and an almost 3% drop in copper price are compounded by poor corporate news this morning. The National Australia Bank slashed its dividend after revealing a half-year drop in revenues and margins. Former top wealth manager AMP reported outflows of $1.8 billion in the first quarter of 2019, and both blue chips are likely to open lower.

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