The ASX is likely to face another decline today, with ASX 200 futures down 0.98% to 8019 points after volatile US trading ended.
The ASX 200 closed 46 points lower (-0.57%) at 8,094 yesterday, weighed down by declines in the Energy (-2.87%), Utilities (-2.07%), and Consumer Discretionary (-1.12%) sectors. In contrast, the Materials (+0.18%), Telecommunications (+0.14%), and Information Technology (+0.10%) sectors outperformed the broader market.
“The ASX200 fell for an eleventh time yesterday over the last fourteen sessions, a disappointing performance despite a strong session on Wall Street and given a trio of unexpectedly positive news flows this week to counter tariff headlines,” IG Markets analyst Tony Sycamore wrote.
- Germany's surprise announcement this week of a larger-than-expected fiscal package proposal now anticipated to exceed 1 trillion Euros.
- China's NPC reiterated its 5% GDP growth target and announced a modest fiscal expansion focusing on accelerating AI adoption and autonomous driving.
- Australia’s Q4 GDP suggests growth has bottomed, and the Australian economy can reach the RBA’s average growth forecast of 2.1% for 2025.”
The ASX 200 Energy sector has dropped 5.9% this week, hitting its lowest level since January 2022, as crude oil faces pressure from tariffs, US economic concerns, the potential easing of US sanctions on Russia, and OPEC+’s decision to raise output. Woodside fell 4.73% to A$22.98 after going ex-dividend, while AGL declined 4.08% to A$10.19, Ampol lost 1.8% to A$24.66, and Santos dropped 1.9% to A$6.13.
The ASX 200 Financial sector edged closer to its February low, with reporting season weighing on major banks. Commonwealth Bank of Australia (CBA) fell 1.79% to A$153.59, Westpac declined 0.89% to A$31.26, and Macquarie slipped 0.42% to A$220.50. Bucking the trend, ANZ edged up 0.07% to A$29.38, while National Australia Bank (NAB) added 0.12% to A$34.59.
Nasdaq leads US declines
US stock markets tumbled overnight, with the tech-heavy Nasdaq leading declines, as trade uncertainty and shifting tariff policies from the Trump administration intensified investor concerns.
“President Donald Trump announced that goods from Canada and Mexico under the US-Mexico-Canada trade agreement (USMCA) would be exempt from the 25% tariffs imposed earlier this week - for a month. This move followed his exemption of automotive goods, which initially only mentioned Mexico, but Trump later extended the exemption to include Canada. The rapidly shifting sands of US tariffs are turning into quicksand for businesses in the US, Canada and Mexico to drown in,” Sycamore noted.
In other news, a surge in Challenger job cuts added to investor anxiety, with US employers announcing 172,017 job cuts in February 2025—the highest since July 2020—compared to 49,795 in January. “With the impact of the Department of Government Efficiency actions, cancelled government contracts, fear of trade wars, and bankruptcies, job cuts soared in February,” said Andrew Challenger, Senior Vice President at Challenger, Gray & Christmas.
However, weekly jobless claims provided some relief. Initial jobless claims fell by 21,000 to 221,000, well below market expectations of 235,000. Attention now turns to tonight’s job report, where the market anticipates the US economy will add 150,000 jobs, with the unemployment rate steady at 4%. A result in line with expectations is seen as key to easing fears of a potential "Trumpcession" and stabilising volatile US stock markets.
In the rates market, expectations for Federal Reserve policy have shifted. Traders are now fully pricing in a 25-basis-point (bp) rate cut in June and a total of 75 bp in cuts for 2025, up from 31 bp following the stronger-than-expected Consumer Price Index (CPI) report in mid-February.
European markets slip as rising bond yields weigh on sentiment
European sharemarkets closed lower on Thursday as rising bond yields pressured equities, while uncertainty over US tariffs clouded the global market outlook. European bond yields climbed further, driven by a global bond sell-off following Germany’s plans to relax fiscal spending rules. The European Central Bank (ECB) cut the deposit rate by 25 basis points to 2.5% as expected, but changes in its policy statement suggested that another rate cut in April is not assured, pushing yields higher.
Banking stocks rose 0.8% to a record high, but gains were limited by a 2.7% drop in British banks. The continent-wide FTSEurofirst 300 index edged down 0.1%, while London’s FTSE 100 index declined 0.8%.
Currency markets mixed against the US dollar
Currencies showed mixed performance in European and US trade. The euro fell from US$1.0849 to US$1.0764, stabilising near US$1.0790 at the US close. The Australian dollar lifted from US63.21 cents to US63.59 cents, before settling at US63.30 cents. The Japanese yen strengthened from JPY149.20 per US dollar to JPY147.32, before easing to JPY147.90 at the US close.
Oil prices flat amid tariff concerns
Global oil prices ended largely unchanged after choppy trade, with markets under pressure from tariff disputes between the US, Canada, and China, alongside OPEC+’s decision to increase output. Brent crude rose US16 cents (0.2%) to US$69.46 per barrel, while US Nymex crude added US5 cents (0.1%) to US$66.36 per barrel.
Commodities: base metals and iron ore rise
Base metal prices advanced, with copper futures gaining 0.3% to reach a four-month high, supported by a weaker US dollar and a temporary tariff exemption for automakers granted by US President Donald Trump. Aluminium futures climbed 1.8%.
Gold prices edged higher, with gold futures rising US60 cents to US$2,926.60 an ounce, as investors weighed rising US bond yields and engaged in profit-taking. Spot gold traded near US$2,910 at the US close.
Iron ore futures gained US52 cents (0.5%) to US$101.24 per tonne, as investors assessed China’s demand outlook, including Beijing’s potential plans to cut nationwide steel output this year.
What about small caps?
The S&P/ASX Small Ordinaries (XSO) gained 0.50% yesterday to 3,094.40. Over the past five days, it has declined a total of 2.58%.
News is trickling in today, but you can read about the following and more throughout the day.
- American Rare Earths Ltd has released the results of its Updated Halleck Creek Scoping Study, reaffirming the project’s strong economic potential, scalability, and strategic significance. The study, conducted by independent engineering firm Stantec Consulting Services Inc., outlines Halleck Creek’s economic viability and competitive advantages, positioning it as a key U.S.-based rare earths project. Located in Wyoming, a Tier 1 mining jurisdiction, the project benefits from state land tenure, which facilitates a streamlined permitting process and accelerated development timeline.
- Highfield Resources Ltd has announced that Beijing Energy International Holding Co., Ltd has received a statement of no objection from the Foreign Investment Review Board (FIRB) regarding its proposed US$50 million investment in Highfield. The investment involves the subscription of ordinary shares at A$0.50 per share, securing FIRB approval for the transaction.
- Ora Banda Mining Ltd has entered into a secured Syndicated Facility Agreement (SFA) with Australia and New Zealand Banking Group (ANZ) and the Commonwealth Bank of Australia (CBA). The agreement provides Ora Banda with a A$50 million revolving credit facility (RCF) for a two-year term, with an option for a one-year extension subject to mutual agreement. The facility is structured on competitive terms and includes customary covenants, conditions precedent, and third-party consents.
- Cyprium Metals Ltd has completed the divestment of its Meekatharra Project, aligning with its previously announced strategy to focus on core assets. The transaction follows the company's February 5, 2025 announcement regarding the sale of the non-core asset.
- Anteris Technologies Global Corp. has appointed David St Denis as President and Class II Director of the Board, effective 6 March 2025. As a non-independent director, St Denis will not serve on any Board committees.