Australian shares to open lower as markets assess US-Iran deal
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The news: The Australian sharemarket is set to open lower after Wall Street ended mixed overnight, as investors awaited further details of a memorandum of understanding between the US and Iran aimed at ending the conflict and reopening the Strait of Hormuz, while falling oil prices eased inflation concerns.
The numbers: Updated at 7:50am AEST:
- ASX futures: down 29 points to 8,875 points
- Wall Street: Dow Jones up 0.64%, S&P 500 down 0.57%, Nasdaq down 1.15%
- Europe: FTSE 100 up 0.61%, CAC 40 up 0.75%, DAX up 0.07%
- Spot gold: up 0.50% to USD4,331 per ounce
- Oil prices: Brent down 4.78% to USD79.27/barrel, US WTI down 5.21% to USD76.52/bbl
- AUD: down 0.09% at 70.66 US cents
- Bitcoin: down 0.90% to USD65,693
The context: The three major US indices finished mixed on Tuesday, with the Nasdaq and S&P 500 closing lower under pressure from technology stocks, while the Dow Jones notched a second consecutive record close.
SpaceX shares rose 4.8% at USD201 ($284), lifting the company’s market value above that of Amazon and briefly surpassed Microsoft during morning trading. The gains followed an agreement to acquire AI coding startup Cursor in an all-stock transaction valuing the company at USD60 billion, strengthening its position in the AI software market.
Elsewhere, Brent crude prices fell 5.1% to below USD80 a barrel, its lowest level since early March, after a senior US official said Iran would be allowed to immediately resume oil and fuel exports under the memorandum of understanding reached with Washington on Monday to end the conflict.
Globally, the Bank of Japan raised its policy rate by 25 basis points on Tuesday to its highest level since 1995, according to the Wall Street Journal. Investors are now awaiting policy decisions from the Bank of England, Swiss National Bank and the Federal Reserve later this week, with all three expected to leave rates unchanged.
Locally, Commonwealth Bank is scheduled to release its May household spending insights report at 9:00am AEST, while the Melbourne Institute will publish its leading index at 11:00am AEST.
