Australian shares are poised to open higher today, with ASX 200 futures up 28 points or 0.34% at 8:30 am AEST, following strong gains on Wall Street.
The S&P 500 extended its rally overnight, notching its best six-day run since March 2022. The benchmark index has now recovered nearly all the ground lost after the Liberation Day holiday sell-off, reflecting renewed investor confidence.
Market sentiment was buoyed by a series of upbeat trade-related updates, even though the announcements were light on specific detail. Nevertheless, they were sufficient to lift risk appetite and support equity valuations.
Attention now turns to another full day of corporate earnings, with March quarter results expected from a string of major companies, including Champion Iron and Perseus Mining and the small caps already bombarding the ASX. Investors will be watching closely for guidance updates and margin performance as reporting season picks up pace.
Looking ahead, Australian consumer price index (CPI) and private sector credit data are due for release. Quarterly updates are expected from Champion Iron, Coles Group, Mirvac Group, Origin Energy and Stockland. Bank of Queensland will trade ex-dividend. In China, purchasing managers' indexes (PMIs) are scheduled for release. In the United States, data on gross domestic product (GDP), ADP private payrolls, personal income and spending, inflation, pending home sales and the employment cost index are expected. Earnings results from Caterpillar, Meta Platforms, Microsoft and Qualcomm are also due.
Wall Street rises on trade optimism despite weak data; attention turns to GDP and inflation print
US equity markets closed higher overnight as investors welcomed renewed optimism surrounding trade negotiations and tariff relief. Reports suggesting a major US-China trade deal is nearing completion helped bolster sentiment, alongside the Trump administration’s decision to ease tariffs on car manufacturers. Adding to the positive tone, China reportedly exempted US ethane from its 125% import tariff.
However, the macroeconomic backdrop showed signs of strain. The US trade deficit widened to US$162.0 billion in March, up from US$147.8 billion in February. The increase was underpinned by a 27.5% month-on-month surge in imports of non-automotive consumer goods and inventories. The data has heightened the risk that first-quarter 2025 gross domestic product (GDP), due tonight, may turn negative for the first time since early 2022, following 2.3% growth in the December quarter.
Labour market signals also weakened. The March Job Openings and Labor Turnover Survey (JOLTS) revealed job vacancies fell to 7.19 million from a downwardly revised 7.48 million, with the vacancy rate easing to 1.02% — the lowest since September 2024, a period during which the Federal Open Market Committee (FOMC) voiced concern over labour market conditions.
Consumer sentiment also declined, with the Conference Board’s Consumer Confidence Index dropping for a fifth consecutive month, shedding 7.9 points to 86.0. The fall reflects growing pessimism about future business conditions and marked the weakest reading since March 2009.
Looking at the copmanies, Snap Inc shares slumped 13.97% in after-hours trade to US$7.82 despite beating revenue expectations with US$1.36 billion. The company, like several others, withheld forward guidance citing macroeconomic uncertainty. Super Micro Computers also fell sharply, losing 15.67% to US$30.35 after issuing preliminary earnings well below forecasts — US$4.5 billion to US$4.6 billion versus expectations of US$5.5 billion.
Market focus now turns to key economic releases, including the Federal Reserve’s preferred inflation gauge — the Core Personal Consumption Expenditures (PCE) Price Index — which is expected to rise 0.1% month-on-month in March, easing the annual rate to 2.6% from 2.8%. Personal income is forecast to grow 0.4%, with personal spending expected to increase by 0.6%.
Major corporate earnings from Meta Platforms, Microsoft, Robinhood, Qualcomm and eBay are also due. Meanwhile, the US interest rate futures market is currently pricing in 97 basis points of cumulative rate cuts by year-end, with the first move anticipated in July.
European shares extend winning streak
European sharemarkets advanced for a sixth consecutive session on Tuesday, led by strong gains in the aerospace and defence sector.
Rheinmetall surged 8.5% after Europe’s largest ammunition producer reported a 46% increase in preliminary first-quarter sales, driven by robust demand in its defence division. HSBC Holdings shares rose 3% following the announcement of a US$3 billion share buyback initiative.
- The continent-wide FTSEurofirst 300 index added 0.4%.
- London’s FTSE 100 index rose 0.6%.
Currencies, commodities and metals
Currencies
Currencies moved mixed against the US dollar during European and US trade.
- The Euro strengthened from US$1.1369 to US$1.1417, settling near US$1.1385 at the US close.
- The Australian dollar weakened from A$0.6430 to A$0.6376 and was trading near A$0.6380.
- The Japanese yen firmed from JPY142.75 per US dollar to JPY141.98, closing near JPY142.30.
Commodities
Global oil prices fell more than 2% to a two-week low, as investors prepared for a potential output increase from OPEC+ and remained cautious over the impact of US President Donald Trump’s tariffs on global economic growth.
- Brent crude declined by US$1.61 or 2.4% to US$64.25 a barrel.
- US Nymex crude slid US$1.63 or 2.6% to US$60.42 a barrel.
Metals
Base metals were mixed.
- Copper futures dipped 0.4%, whereas aluminium futures gained 0.8%.
- Gold futures dropped by US$14.10 or 0.4% to US$3,333.60 an ounce, as signs of easing tensions between the United States and China reduced safe-haven demand. Spot gold was trading near US$3,316 at the US close.
- Iron ore futures slipped by US$0.05 or 0.1% to US$99.86 per tonne amid uncertainty surrounding trade negotiations between Washington and Beijing.