Australian shares are set for a lukewarm start amid investor caution ahead of the federal government unveiling the size of its budget deficit later on Thursday.

The Australian SPI 200 futures contract was higher by 7.0 points, or 0.12 per cent, to 6048.0 points at 0800 AEST on Thursday.

An economic and fiscal update by Treasurer Josh Frydenberg, to be released at 1100 AEST, will be the focus of the market’s attention, with the government expected to reveal a huge debt bill after tagging tens of billions of dollars for measures to support the economy through the coronavirus pandemic.

Overnight, US markets edged higher, helped by robust home sales data, with the three main indices see-sawing through the trading session.

The US Federal Reserve’s efforts to support the economy through the pandemic, and expectations the US government will deliver more financial aid, have been key in keeping markets mostly higher since stocks plunged in March.

The Dow Jones Industrial Average rose 0.62 per cent to 27,005.84, the S&P 500 gained 0.57 per cent, to 3,276.02 and the Nasdaq Composite added 0.24 per cent, to 10,706.13.

Meanwhile Westpac has named a new boss for its institutional bank, tapping Deutsche Bank’s chief executive for Australia and New Zealand Anthony Miller for the role.

The Australian dollar was trading at 71.39 US cents at 0800 AEST, higher from 71.34 US cents at Wednesday’s close.