Australian shares to edge lower as Wall St tech rally offsets Middle East tensions
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The news: The Australian sharemarket is set to open marginally lower despite a rally on Wall Street overnight, as falling oil prices and renewed enthusiasm for technology stocks helped investors look past concerns over further military action in the Middle East.
The numbers: Updated at 7:45am AEST:
- ASX futures: down 2 points to 8,736 points
- Wall Street: Dow Jones up 0.27%, S&P 500 up 0.81%, Nasdaq up 1.30%
- Europe: FTSE 100 down 0.16%, CAC 40 up 0.90%, DAX up 0.89%
- Spot gold: up 1.19% to USD4,123 per ounce
- Oil prices: Brent down 2.54% to USD76.04/barrel, US WTI down 2.33% to USD71.81/bbl
- AUD: up 0.13% at 69.37 US cents
- Bitcoin: up 1.51% to USD63,207.
The context: All three major US indices closed higher on Thursday despite renewed conflict in the Middle East, with the US and Iran both announcing military strikes in the Gulf as their fragile interim peace agreement came under renewed strain.
Oil prices, which surged after the US strikes were announced on Wednesday, retreated on Thursday even as shipping activity through the Strait of Hormuz remained subdued.
Iran has also accelerated crude exports, dispatching tankers carrying about 11 million barrels over the past 24 hours as tensions with the US escalated and US President Donald Trump threatened to reinstate a blockade on Iranian ports.
The Philadelphia Semiconductor Index rose 3.1% as investors returned to AI-related stocks ahead of the US listing of SK Hynix’s on Friday (ET). Micron Technology also announced plans to increase investment in US manufacturing to USD250 billion ($360 billion) to meet demand driven by the AI boom.
Elsewhere, US existing home sales unexpectedly fell 2.4% to an annualised 4.09 million units in June, below Reuters forecasts of 4.20 million as tight housing supply pushed prices to a record high, while elevated mortgage rates linked to the Middle East conflict kept prospective buyers on the sidelines.
