ASX drops amid broad selloff; banks and healthcare stocks lead losses
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More news: Australian shares opened sharply lower, tracking losses on Wall Street overnight, with all but one sector falling into the red.
The benchmark S&P/ASX 200 index was down 80.2 points, or 0.92%, to 8,662.6 at 10:45am AEST. 10 of the 11 sectoral indices were in negative territory.
Financials, down 1.2%, was among the hardest hit, as major lenders NAB (-1.5%), Commonwealth Bank (-1.4%), Westpac (-1.3%) and ANZ (-0.9%) all retreated.
Healthcare stocks also fell around 1.2%, as the sector's largest companies CSL (-1.9%), Pro Medicus (-1.6%) and Sigma Healthcare (-1.4%) fell. The selloff came after US President Donald Trump issued letters to the bosses of 17 major pharmaceutical firms overnight, urging them to lower US pricing on prescription drugs, and sending US healthcare shares lower.
Meanwhile, Capstone Copper was the best performing ASX 200 company, adding 4.8%, after reporting record second-quarter production and adjusted earnings.
Australian shares to fall as tech earnings take US stocks lower
The news: Australian shares are set to drop at the open after each of the major US indices closed lower overnight following a mixed set of second-quarter earnings from tech megacaps.
The numbers: Updated at 7:30am AEST:
- ASX futures: down 64 points to 8,639 points
- Wall Street: Dow Jones down 0.74%, S&P 500 down 0.37% and Nasdaq down 0.03%
- Europe: CAC 40 down 1.14%, DAX down 0.81% and FTSE 100 down 0.05%
- Spot gold: up 0.45% to USD3,290 per ounce
- Oil prices: Brent up 0.02% to USD71.72/bbl and US WTI down 0.91% to USD69.36/bbl
- AUD: down 0.14% to 64.29 US cents
- Bitcoin: up 0.12% to USD116,627.
The context: US stocks ended lower after a mixed bag of second-quarter earnings by tech megacaps. Microsoft (+4%) briefly became the second publicly traded company to hit a USD4 trillion market valuation after reporting quarterly earnings that beat Wall Street’s expectations. Meta Platforms (+11.3%) shares surged after second-quarter revenue jumped 22%.
Investors also braced for earnings results from fellow tech giants Apple and Amazon, which reported after the close. Apple climbed 2.9% in after-hours trade after topping market estimates for iPhone sales, while Amazon tumbled 6.1% after forecasting lower-than-expected operating profit in the third quarter.
However, pharmaceutical stocks ended mostly lower after US President Donald Trump sent letters to 17 major drugmakers urging them to lower US prices. Copper prices also dragged after Trump set 50% tariffs on copper products, but not on the raw material.
