ASX cautious ahead of central bank decisions, S&P/ASX 200 down 0.47%

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ASX cautious ahead of central bank decisions, S&P/ASX 200 down 0.47%
Credit: © Reuters.

On Tuesday, the S&P/ASX 200 (INDEXASX: XJO) ended the day lower by 0.47% at 7196.60 points, as investors adopted a cautious stance ahead of key decisions from several central banks later in the week. The Australian Securities Exchange (ASX) appears to be in a holding pattern, with the U.S. Federal Reserve, the Bank of England, and Bank of Japan all set to make important announcements regarding interest rates.

The ASX 200 fell by 33 points in what was described as a "nothing session." The Energy sector outperformed, rising by 0.21%, while Utilities and Consumer Discretionary sectors remained unchanged. Materials (-0.77%), Property (-0.73%), and Staples (-0.70%) sectors experienced declines.

The Reserve Bank of Australia (RBA) released minutes from its September meeting on Tuesday, revealing that the board had considered raising interest rates but decided against it due to recent significant increases. New RBA boss Michele Bullock took over just a day before the release of these minutes.

Despite this decision, JPMorgan Chase & Co (NYSE: NYSE: JPM ) and others are still expecting further tightening, likely in November, to combat inflation. This expectation is partly due to the sharp increase in oil prices, which reached new 10-month highs overnight.

In company news, New Hope (OTC: NHPEF ) Corporation Ltd (ASX: NHC) rallied by 2.11% following impressive FY23 results which showed an 11% profit increase and a declared dividend of 30 cents per share fully franked. Gold miner Newcrest Mining (OTC: NCMGF ) Ltd (ASX: NCM) also saw a rise of 1.37% after gold prices ticked up and their proposed merger with Newmont Corporation (NYSE: NEM) gained FIRB approval.

In index changes, Harvey Norman Holdings Limited (ASX: HVN) was removed from the S&P/ASX 100 (INDEXASX: XTO), replaced by Liontown Resources Ltd (ASX: LTR). Several companies were also added to and removed from the ASX 200.

Meanwhile, in the U.S., grocery retailer Instacart priced its initial public offering (IPO) at the top of a marketed range to raise $660m at $30/share, which valued the company at $9.9 billion. This valuation is significantly lower than the $39 billion valuation achieved during its last funding round in 2021.

Asian markets were mostly lower, with Hong Kong down by 0.03%, Japan by 0.72% and China by 0.02%. U.S. futures also indicated a lower opening, down by around 0.2%.

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