US Federal Reserve Open Market Committee May meetings minutes released overnight confirm a benign approach from the Fed while emphasising its commitment to normalisation of monetary policy over the medium term. A modest post-release fall in the USD suggests the messaging from the Fed was slightly less hawkish than some feared.

Rallies across US stock exchanges support the perception that investors remain focused on the underlying economic strength rather than the consequent interest rate rises. Materials stocks led the session, despite falls in copper and iron ore. More predictably energy shares slid with oil prices ahead of an OPEC meeting tonight. Financial stocks finished flat overall. Given the sector’s leverage to economic growth some saw this as evidence of an unchanged economic outlook.

Asia Pacific futures markets are indicating modest opening gains. The exception is Japan, where a strengthening Yen is likely to weigh on the Nikkei indices. Australian investors are mulling poker machine manufacturer Aristocrat’s 57% increase in half-year profit announced this morning. AGM outlook statements from Alumina, Adelaide Brighton Cement and AMP may also influence trading.

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