**ASX Poised for Modest Decline as Walmart Shares Tumble; All Eyes on Federal Reserve’s Powell for Policy Cues**
*Adapted and expanded from the original by Sarah Turner, Australian Financial Review*
Australia’s stock market is set to open on a weaker note as global investors digest a mix of corporate earnings, central bank signals, and economic data. Wall Street wavered overnight, with a notable drop in Walmart shares impacting market sentiment. Meanwhile, traders worldwide are watching for clues from Federal Reserve Chair Jerome Powell regarding the future path of US interest rates. This article provides a comprehensive overview of recent market movements, factors influencing investor sentiment, and the potential implications for local and global markets.
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## Global Markets Face Turbulence Ahead of Powell’s Remarks
* Wall Street faced a mixed trading session overnight, with major indices swaying between minor gains and losses.
* The S&P 500 shed 0.2 percent, the Dow Jones Industrial Average fell 0.5 percent, while the Nasdaq Composite managed to edge slightly higher at 0.1 percent by session’s end.
* US equity futures traded flat in after-hours action, reflecting a cautious tone among investors as they awaited fresh economic guidance.
* European markets were similarly lackluster, with the pan-European STOXX 600 falling 0.3 percent, and London’s FTSE 100 down 0.6 percent.
Walmart’s quarterly earnings gave investors a reason for pause. Despite the US retail giant posting profits that met expectations, its management noted that consumers were tightening their belts due to ongoing inflation. This cautious outlook sent Walmart’s shares down by more than 7 percent, marking their sharpest daily decline in years and weighing on the entire consumer staples sector.
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## Investor Anxiety Grows Ahead of Fed Policy Statements
The imminent appearance of Federal Reserve Chair Jerome Powell has heightened market volatility. Traders are eager for insight into how resilient the US economy remains in the face of persistent inflation and whether the Fed remains on track to cut interest rates later this year.
### Key Points Investors Are Watching
* Whether Powell maintains the Fed’s cautious stance or signals a more aggressive path toward policy easing.
* Data on US consumer sentiment and retail spending, as any weakness could force the Fed to reconsider its trajectory.
* Clues in Fed commentary about labor market resilience and whether the recent cooling in inflation will hold.
US Treasury yields, which act as a bellwether for interest rates, have been volatile as investors position themselves ahead of Powell’s speech. The US 10-year yield was last near 4.23 percent, close to its highest level in weeks.
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## Australian Market Sets Up for a Modest Decline
Analysts expect the S&P/ASX 200 to open slightly lower, mirroring overnight softness on global bourses. Futures pointed to a drop of about 14 points, or 0.2 percent, at the open. Several factors are weighing on the local market:
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Read more on AUD/USD trading.