ASX set to dip as Wall Street drifts ahead of inflation data; $A lower

“A softer print can clear the path for a year-end rally, with the second half of December being the second-strongest period of the year,” a team led by Ohsung Kwon said. “On the contrary, a firmer print can revamp volatility,” particularly after the post-election rally.

Oracle sank 6.7 per cent after reporting growth for the latest quarter that fell just short of analysts’ expectations. It was one of the heaviest weights on the S&P 500, even though CEO Safra Catz said the company saw record demand related to artificial-intelligence technology for its cloud infrastructure business, which trains generative AI models.

AI has been a big source of growth that’s helped many companies’ stock prices skyrocket. Oracle’s stock had already leaped nearly 81 per cent for the year coming into Tuesday, which raised the bar of expectations for its profit report and future growth.

C3.ai recovered from an early loss and rose 6.5 per cent. It reported a smaller loss for the latest quarter than analysts expected. The AI software company increased its forecast for how big a loss it expects to take this fiscal year from its operations.

In the bond market, Treasury yields ticked higher ahead of Wednesday’s report on the inflation that US consumers are feeling. That and a report on Thursday about inflation at the wholesale level will be the final big pieces of data the Fed will get before its meeting next week.

The Fed has been easing its main interest rate from a two-decade high since September to lift the slowing jobs market, after bringing inflation nearly down to its 2 per cent target. Lower rates would help give support to the slowing job market, but they could also provide more fuel for inflation.

The yield on the 10-year Treasury rose to 4.24 per cent from 4.20 per cent late on Monday.

Even though the Fed has been cutting its main interest rate, mortgage rates have been more stubborn and have been volatile since the autumn. That has hampered the housing industry, and home builder Toll Brothers’ stock fell 7 per cent even though it beat analysts’ expectations for profit and revenue in the latest quarter.

CEO Douglas Yearley Jr said the luxury builder has been seeing strong demand since the start of its fiscal year six weeks ago, an encouraging signal as it approaches the beginning of the spring selling season in mid-January.

Elsewhere on Wall Street, Alaska Air Group soared 13.2 per cent after raising its forecast for profit in the current quarter. The airline said demand for flying around the holidays has been stronger than expected. It also approved a plan to buy back up to $1 billion of its stock.

In other international markets, indexes were mixed in China after the world’s second-largest economy said its exports rose by less than expected in November. Stocks rose 0.6 per cent in Shanghai but fell 0.5 per cent in Hong Kong.

with AP, Bloomberg

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