The ASX is set to rise today, with ASX 200 futures up 27pts (+0.31%) as of 8:30 am AEST.
The S&P/ASX 200 Index ended Thursday marginally lower, slipping 1 point (-0.02%) to close at 8,595, despite earlier hitting an intraday high of 8,623.6. A late-session retreat saw the benchmark fall as much as 0.92% from its peak before support emerged above key technical levels.
The rotation out of financials and consumer-facing stocks and into materials helped cushion the fall, with the Materials sector climbing 3.02% on the back of a 2.5% gain in iron ore to US$95.55 per tonne. Energy (+0.83%) and Health Care (+0.60%) also gained, while Telecommunications (-1.47%), Financials (-1.27%) and Consumer Discretionary (-1.08%) weighed on the index.
Commonwealth Bank of Australia dropped 2.17% to A$179.68, extending its pullback from a record high last week. JB Hi-Fi, Harvey Norman, and Myer Holdings all posted losses following weak retail sales figures, despite growing market expectations for an interest rate cut by the Reserve Bank of Australia next week. The futures market is pricing in an 86% chance of a 25 basis point cut on 8 July and 77 basis points of easing by year-end.
Miners surged as capital rotated from banks, led by Mineral Resources (+7.76%), BHP (+5.56%), Rio Tinto (+1.80%) and Fortescue (+1.82%), supported by Chinese policy signals to curb low-price competition across key industries.
Pro Medicus also rallied 7.78% to A$307.39 on news of US$190 million in US contracts, including a 10-year A$170 million deal with UCHealth in Colorado.
US markets rally as jobs data cools rate cut bets
Wall Street closed the shortened holiday week in positive territory, buoyed by stronger-than-expected employment data and optimism around trade policy. The US economy added 147,000 jobs in June, exceeding consensus expectations of 110,000, while the unemployment rate eased to 4.1%. The participation rate dipped to 62.3%, its lowest since December 2022.
Bond markets reacted with front-end yields rising 10 basis points as traders reassessed the outlook for monetary easing. The probability of a US Federal Reserve rate cut in September fell to 70% from 100%.
Investors are now focused on the July 9, deadline for the White House to decide whether to extend reciprocal tariff suspensions or reinstate higher trade barriers, setting the stage for potential volatility in the coming week.
Europe rebounds on trade hopes, UK political reassurance
European sharemarkets rose on Thursday, lifted by hopes of a trade deal between the European Union and United States.
- The FTSEurofirst 300 index gained 0.4%, led by a 1.4% rise in the banking sector. UK lenders NatWest and Lloyds each climbed more than 3%.
- In London, the FTSE 100 rebounded 0.6% following losses a day earlier, with sentiment stabilised after Prime Minister Keir Starmer publicly backed Finance Minister Rachel Reeves amid parliamentary tensions.
Commodities mixed, currencies ease against US dollar
Currency markets saw broad US dollar strength.
- The Euro declined to US$1.1722 before stabilising near US$1.1760.
- The Australian dollar eased to US65.70 cents.
- The Japanese yen weakened to JPY144.90.
Commodity prices were mixed.
- Brent crude fell US31 cents to US$68.80 per barrel and WTI dipped US45 cents to US$67.00, on concerns tariffs may dampen demand.
- Copper lost 1%, aluminium slipped 0.2%, and gold dropped US$16.80 to US$3,342.90 per ounce as Fed rate cut expectations were pared back.
- Iron ore rose 1.2% to US$96.24 per tonne, continuing its upward momentum.