ASX opens lower as industrial losses outweigh energy gains
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More news: Australian shares opened lower dragged down by losses in industrial and financial sectors, however the declines were partially offset by a sharp rally in energy stocks, which surged after global oil prices jumped more than 9% overnight.
The benchmark ASX 200 was down by 41.2 points, or 0.47%, to 8,767 at 10:33am AEST. Six of the 11 sectoral indices opened in the red.
Energy (+2.6%) was the strongest performing sector for a second consecutive session, supported by a lift in Woodside (+3.6%), Santos (+2.3%), Ampol (+2.2%) and Whitehaven Coal (+3%) following Trump’s decision to reimpose a naval blockade on Iranian shipping through the Strait of Hormuz overnight.
Beyond energy stocks, Light & Wonder (+4.9%), Seek (+2.4%) and WiseTech Global (+2.4%) were among the best performing stocks at the open.
Elsewhere, industrials (-1.5%) was the worst performing sector at the open, weighed down by Computershare (-1.5%), Qantas Airways (-2.5%), Worley (-2.4%) and NRW Holdings (-2.3%).
Kingsgate Consolidated (-13.7%), Silex Systems (-7.2%), Deep Yellow (-5.3%) and Predictive Discoveries (-5.1%) were among the worst performing stocks across the ASX 200.
On the data front, the ABS is scheduled to publish overseas arrivals and departures data for May at 11:30am AEST.
Australian shares to open lower as Trump’s 20% Hormuz toll lifts oil
The news: The Australian sharemarket is set to open marginally lower after a sell-off in technology shares dragged Wall Street lower overnight, as a sharp decline in chip stocks rattled confidence in the AI trade and oil prices surged after US President Donald Trump reimposed a blockade on Iranian shipping.
The numbers: Updated at 7:45am AEST:
- ASX futures: down 8 points to 8,775 points
- Wall Street: Dow Jones down 0.26%, S&P 500 down 0.79%, Nasdaq down 1.55%
- Europe: FTSE 100 up 0.01%, CAC 40 up 0.31%, DAX up 0.19%
- Spot gold: down 2.89% to USD4,001 per ounce
- Oil prices: Brent up 7.98% to USD82.07/barrel, US WTI up 9.20% to USD77.97/bbl
- AUD: down 0.58% at 69.17 US cents
- Bitcoin: down 2.84% to USD61,994.
The context: All three major US indices closed lower on Monday, led by a sell-off in chipmakers, with the Philadelphia Semiconductor Index falling 4.8%. US-listed shares of SK Hynix dropped 9.3% after surging about 13% in their Nasdaq debut on Friday. Micron fell 4.4%, Intel lost 6.1% and Sandisk tumbled 13%. SpaceX declined 4.2% to USD139 ($200), nearing its initial public offering price of USD135.
Elsewhere, oil prices surged after Trump reinstated the US blockade on Iranian shipping through the Strait of Hormuz and demanded a 20% levy on all other cargo transiting the waterway. US Central Command said the blockade of Iranian ports would take effect at 4pm New York time on Tuesday, and apply to all vessel traffic regardless of flag.
OPEC cut its global oil demand growth forecast to 780,000 barrels a day from 970,000, while the International Energy Agency expects demand to decline by 1 million barrels a day this year. The US Energy Information Administration forecasts a decline of 1.2 million barrels a day, the Wall Street Journal reported.
US Federal Reserve chair Kevin Warsh is due to deliver his first semiannual testimony before Congress on Tuesday and Wednesday (ET), where he is expected to face questions on the inflationary impact of the US-Iran conflict and the Fed’s policy outlook. Markets are pricing in at least one 25 basis point rate hike by year-end, according to LSEG data.
Locally, the Australian Bureau of Statistics will release overseas arrivals and departures data for May at 11:30am AEST.
