ASX to open higher after Wall Street hits record
They helped offset a 2.7 per cent drop for General Motors. The auto giant said it will take a $US6 billion hit to its results for the last three months of 2025 related to its pullback from electric vehicles. That’s on top of the $US1.6 billion in charges GM took in the prior quarter. Fewer tax incentives and easier fuel-emission regulations have been eating into demand for EVs.
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WD-40 tumbled 6.6 per cent after reporting a weaker profit for the latest quarter than analysts expected. Chief financial officer Sara Hyzer said the soft numbers were primarily because of timing issues, not weaker demand from end customers, and the company stood by its financial forecasts for the upcoming year.
All told, the S&P 500 rose 44.82 points to 6,966.28. The Dow Jones Industrial Average added 237.96 to 49,504.07, and the Nasdaq composite climbed 191.33 to 23,671.35.
In the bond market, Treasury yields were mixed.
Friday’s improvement in the U.S. unemployment rate was enough to get traders to ratchet back expectations for a cut to interest rates at the Fed’s next meeting, which is scheduled for later this month. Traders are now forecasting just a 5 per cent chance of that, down from 11 per cent a day before, according to data from CME Group.
But traders nevertheless still largely expect the Fed to cut rates at least twice this upcoming year.
Whether they’re correct carries high stakes for financial markets. Lower interest rates can goose the economy and push up prices for investments, though they can also worsen inflation at the same time. And inflation has stubbornly remained above the Fed’s 2 per cent target.
“Until the data provide a clearer direction, a divided Fed is likely to stay that way,” according to Ellen Zentner, chief economic strategist for Morgan Stanley Wealth Management. “Lower rates are likely coming this year, but the markets may have to be patient.”
A separate report released Friday morning suggested sentiment among U.S. consumers is strengthening, particularly among lower-income households. Perhaps more importantly for the Fed, the preliminary report from the University of Michigan also said expectations for inflation in the coming 12 months may be at their lowest level in a year. That could give it more freedom to cut interest rates.
