Australian shares dip 0.1% after volatile Wall Street session
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More news: The Australian sharemarket opened lower following a volatile session on Wall Street, after US economic data raised fears of a potential recession in the world’s largest economy.
The benchmark S&P/ASX 200 index was down 9.50 points or 0.12% to 8,116.70 after the first 20 minutes of trade, with the heavyweight materials, energy and financials sectors proving to be a drag. Top miners BHP, Rio Tinto and Fortescue were down between 0.7% and 2.2%, while energy majors Woodside and Santos lost more than 1% each amid a continuing decline in crude oil prices. Each of the Big Four banks were also trading lower.
However, local technology stocks got a tailwind after better-than-expected quarterly numbers from Microsoft and Meta Platforms overnight.
The cautious sentiment comes after all three major US stock indices tumbled as much as 2% earlier in the session before erasing the losses in a late rally after data showed the US economy contracted in the March quarter for the first time in three years.
Australian shares to slip after volatile Wall Street session
The news: The Australian sharemarket is set to open lower after a volatile session on Wall Street after data showed the US economy contracted in the March quarter for the first time in three years.
The numbers: Updated at 7.25am AEDT:
- ASX futures: down 28 points or 0.34% at 8,114 points
- Wall Street: Dow Jones up 0.35%, S&P 500 up 0.15%, Nasdaq down 0.09%
- Europe: FTSE 100 up 0.37%, CAC 40 up 0.50%, DAX up 0.32%
- Spot gold: up 0.01% at USD3,288.79 per ounce
- Oil prices: Brent down 1.76% to USD63.12/bbl, US WTI down 3.66% to USD58.21/bbl
- AUD: up 0.02% at 64.03 US cents
- Bitcoin: up 0.31% to USD94,598.87.
The context: All three major US stock indices tumbled as much as 2% earlier in the session but erased the losses following a late rally. That came after the US Commerce Department said its advance gross domestic product report showed a 0.3% contraction for the first quarter, falling short of expectations for 0.3% growth. A separate report on monthly consumer spending, which accounts for more than two-thirds of US economic activity, showed a jump of 0.7% in March, topping expectations for a 0.5% rise. Both the GDP and consumer spending data appeared to be affected by the trade war, as businesses and consumers pulled forward spending to avoid tariffs. Traders are now pricing in a full one percentage point interest rate cut from the Federal Reserve by the end of the year.
Meanwhile, Meta Platforms and Microsoft shares rose 5% and 6% respectively in after hours trading after their results topped analyst estimates.
What to watch: International Trade in Goods data for March at 11.30am AEST; annual general meetings for Rio Tinto and GPT Group.
