There was a broad retreat on global markets overnight amid heightened tension ahead of tonight’s crucial Fed meeting in the US.
The FOMC meeting is scheduled to conclude at six am Melbourne time tomorrow morning, and expectations are that officials will provide more concrete guidance on how they intend to reduce stimulus.
A stronger than expected rise in homebuilder confidence this month added to speculation that economic conditions are good enough for a December start date for stimulus tapering.
The Dow shed 10 points (-0.1%) to 15875, the S&P500 dipped six points (-0.3%) to 1781 and the Nasdaq fell six points (-0.1%) to 4024.
It was a similarly bearish night on commodity markets, with oil pressured by Fed stimulus tapering expectations even though analysts are anticipating another fall in weekly US crude stockpiles.
Elsewhere gold suffered a share drop, with traders cautious on the precious metal as they await the latest update on the Fed’s bond buying program.
The US dollar was mixed against other currencies, whilst the Aussie dollar was sold off ahead of a speech by Glenn Stevens this morning that could shed light on the potential for further rate cuts by the RBA.
There are no major economic releases due out today.