Australian shares open lower; oil stocks rally on surging crude prices
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More news: Australian shares lowered in early trading, following investor concerns over the growing conflict in the Middle East, as oil companies rocketed on surging oil prices.
The benchmark S&P/ASX 200 index was down 55.6 points, or 0.65%, to 8,449.9 at 10:30am AEST. Nine of the 11 sectoral indices were in the red.
Energy was the best performing sector, up 0.8%, as oil giants Woodside Energy (2.2%) and Santos (1.4%) climbed. Smaller rivals Beach Energy (3.5%) and Karoon Energy (2.7%) were also higher. The rally followed a spike in global crude prices after Iran's parliament endorsed a measure to close the Strait of Hormuz in response to US strikes on Iranian nuclear sites over the weekend.
Oil refiners Viva Energy (2.9%) and Ampol (0.8%) also rose after E&P Capital played up the chances of a tighter global refinery market in the event of further attacks on Iranian infrastructure.
Retailer group Metcash (4.3%) was the best performing ASX 200 stock after reporting a 10% increase in full-year net profit.
Technology stocks (-1.4%) weighed on the market, with Siteminder (-5.5%), WiseTech Global (-2%) and Technology One (-1.9%) all among the worst performers.
Australian shares to fall after US strikes Iran nuclear sites
The news: Australian shares are poised to drop this morning, with equity markets set to slide globally following US attacks on Iran over the weekend.
The numbers: Updated at 7:30am AEST:
- ASX futures: down 29 points to 8,520
- Wall Street: Dow Jones up 0.08%, S&P 500 down 0.22%, and Nasdaq down 0.51%
- Europe: CAC 40 up 0.48%, DAX up 1.27%, and FTSE 100 down 0.2%
- Spot gold: down 0.07% to USD3,368 per ounce
- Oil prices: Brent up 0.4% to USD77.32/bbl, and US WTI up 0.09% to USD75/bbl
- AUD: down 0.7% to 64.35 US cents
- Bitcoin: flat at USD99,542.
The context: The US bombed Iranian nuclear targets at Fordow, Natanz and Isfahan, with US President Donald Trump describing the attack "a spectacular military success" in a televised address to the nation.
Iran is now weighing its response, as global powers urge restraint and oil markets face continued disruption. Iran's parliament is reportedly considering closing the Strait of Hormuz, through which around 20% of the world's oil and gas demand flows.
Equity markets have remained relatively stable amid escalating conflict between Israel and Iran in recent weeks. However, higher oil prices could trigger fresh concerns about inflation and plans for further interest rate cuts.
