Australian shares are expected to fall slightly this morning, as copper prices dropped to a 16 month low and commodity prices fell to a 16 month low because of worries about a possible global economic slowdown.
By 7: 25 am AEST, the ASX futures were down 0.1 per cent, to 6,416 points.
The Australian dollar was buying 68.95 US cents after falling 0.5 per cent overnight.
US Federal Reserve Chairman Jerome Powell testified before Congress for a second day, a day after saying the Fed was committed to cutting inflation at all costs, and acknowledging that a recession was certainly a possibility, as investors have been weighing the risk of hefty interest rate rises tipping economies into recession.
Peter Cardillo, chief market economist at Spartan Capital Securities in New York, said that the stock market is trying to take advantage of the Fed's tightening and try to put in a low in a bear market.
We have bond yields that are coming down, and that's helping stocks.
The Nasdaq Composite rebounded by 1.6 per cent to 11,232 points on Wall Street, as technology and growth stocks outperformed.
The Dow Jones index closed 0.6 per cent higher, at 30,677, and the S&P 500 increased 1 per cent, to 3,796.
Germany's DAX and Britain's FTSE fell sharply on European markets, by 1.8 per cent and 1 per cent.
The S&P 500 logged its largest weekly percentage drop since March 2020, despite the fact that trading has remained volatile.
The index fell over 20 per cent from its January record high this month, confirming the common definition of a bear market.
Walter Todd, chief investment officer at Greenwood Capital in South Carolina, said there is a lot of uncertainty about the outlook and the market is confused.
Inflation rates and weak economic data fed worries about demand, which resulted in a slump in copper prices.
On the London Metal Exchange, LME copper was down 4.3 per cent, to US 8,397 a tonne, and was its lowest since February 2021, as of February 2021.
Spot gold dropped 0.8 per cent to US 1,822. An ounce is 55 an ounce.
On the oil markets, Brent crude futures fell by 1.7 per cent to US 109.80 a barrel.