Australian shares to edge higher as Wall Street extends tech rout
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The news: The Australian sharemarket is set to open modestly higher despite a renewed selloff in US technology stocks overnight, as investors weighed escalating tension between the US and Iran after Tehran reportedly shot down an US Apache helicopter near the Strait of Hormuz.
The numbers: Updated at 7:40am AEST:
- ASX futures: up 13 points to 8,624 points
- Wall Street: Dow Jones down 0.20%, S&P 500 down 0.26%, Nasdaq down 0.97%
- Europe: FTSE 100 down 1.41%, CAC 40 up 0.05%, DAX down 0.74%
- Spot gold: down 1.31% to USD4,260.41 per ounce
- Oil prices: Brent down 1.67% to USD91.76/barrel, US WTI down 2.57% to USD88.96/bbl
- AUD: up 0.25% at 70.21 US cents
- Bitcoin: down 2.11% to USD61,754.
The context: US tech stocks resumed their selloff on Tuesday following a brief rebound on Monday. The S&P 500 information tech index fell more than 4% before trimming losses, while the Philadelphia Semiconductor Index dropped as much as 8.6% after rising 3% earlier in the session.
Chipmakers led the declines, with Marvell Technology falling 7.6%, Micron Technology down 1.4%, and Apple, Cisco Systems, Qualcomm and AMD each falling more than 3%.
Oil prices closed around 3% lower, with Brent crude settling around USD91 ($129) a barrel and US crude ending near USD88. However, losses narrowed after Trump said the US must respond to Iran’s attack on an American helicopter, reducing hopes for a near-term resolution to the conflict. Earlier, US Central Command said the cause of the helicopter crash remained under investigation.
Trump has repeatedly said the US and Iran are close to reaching an agreement, although there have been few signs of tangible progress since a fragile ceasefire took effect in early April.
Locally, the Australian Bureau of Statistics is scheduled to release data on industrial disputes, and expenditure in research and development at 11:30am AEST.
