The Australian share market is anticipated to open lower as investors await the latest inflation data from the Bureau of Statistics (ABS). The ASX is expected to follow a downward trend set by Wall Street, which experienced a decline after reaching record highs. This drop was influenced by comments from Federal Reserve Chair Jerome Powell, who indicated that U.S. stocks appear to be "fairly highly valued" and did not provide clear guidance on when interest rates might be cut.

In pre-market trading, ASX futures indicated a 0.3% decrease, suggesting a challenging start for the day. The ASX 200 closed at 8,846 points, up 0.4% on the previous day. The Australian dollar remained stable at 65.94 U.S. cents. In the U.S., the Dow Jones Industrial Average fell 0.2% to 46,298 points, the S&P 500 dropped 0.6% to 6,657 points, and the Nasdaq Composite decreased by 1% to 22,573 points.

The decline in U.S. markets was largely attributed to significant losses among major technology companies. Nvidia fell by 2.8%, Microsoft by 1%, Amazon by 3%, Meta by 1.3%, Tesla by 1.9%, and Oracle by 4.4%. These losses contributed to the overall negative sentiment in the tech sector.

During a recent speech, Powell addressed the relationship between market prices and the Federal Reserve's interest rate decisions. He stated, "We do look at overall financial conditions, and we ask ourselves whether our policies are affecting financial conditions in a way that is what we’re trying to achieve. But you’re right, by many measures, for example, equity prices are fairly highly valued." He emphasized the need to balance inflation concerns with a weakening job market, describing the decision on potential rate cuts as a "challenging situation" that remains unclear.

In other market news, gold prices reached a new record high, rising 0.5% to $3,764 per ounce. This increase is partly attributed to Powell's remarks about the U.S. economy, which highlighted risks to inflation and employment. Brent crude oil prices also saw a rise of 2%, reaching $67.87 per barrel, while iron ore prices fell by 0.6% to $106 per tonne. Bitcoin experienced a slight decline of 0.3%, trading at $111,957.

As the trading day unfolds, all eyes will be on the upcoming ABS inflation figures for August. Analysts expect the headline Consumer Price Index (CPI) to remain steady at 2.8% year-on-year. Key factors influencing this data include a decrease in electricity prices due to rebates in New South Wales, although year-on-year comparisons may show an increase due to base effects from the previous year. The release will also provide updates on inflation across various market services, which are expected to remain moderate.