The Australian sharemarket is poised to open slightly weaker after Wall Street gave back early gains overnight. ASX 200 futures were down 31 points (-0.34%) as of 8:30 am AEDT, pointing to a cautious end to the week following Thursday’s strong rebound.
Renewed concerns about the health of US regional banks dragged sentiment lower, while gold prices surged beyond US$4,300 an ounce, adding another leg to a record-breaking rally. The move came as investors sought safety amid fresh credit market tremors, ongoing US-China trade tensions, and the unresolved government shutdown in Washington.
Wall Street fades after early strength
US equities opened higher but faded into the close, with the S&P 500 slipping 0.63%, the Dow Jones down 0.65% and the Nasdaq easing 0.47%. Small caps were hit hardest, the Russell 2000 dropping 2.1% as traders rotated away from risk.
Financial stocks led the losses after several smaller US lenders disclosed new loan problems. Zions Bancorp fell 13% after flagging a US$50 million write-down tied to borrower irregularities, while Western Alliance Bancorp slid 11% following allegations of loan fraud. The developments sparked broader worries about bad debt exposure across the regional banking sector.
Elsewhere, strong earnings from chipmaker TSMC helped limit losses. The Taiwanese giant reported a 39% rise in quarterly revenue and lifted full-year guidance, saying demand tied to artificial intelligence is proving even stronger than expected. Oracle and Nvidia also gained, though profit-taking in big tech names capped momentum by session end.
Miners extend rally as defensives lead locally
The S&P/ASX 200 added 0.86% to 9,068 on Thursday, notching a third gain in four sessions as falling bond yields boosted real estate, financials and healthcare. Property stocks led the pack with a 2.8% rise, while energy and materials posted smaller advances.
After weeks of explosive gains, critical minerals stocks took a breather — Iluka Resources tumbled more than 10%, Lynas Rare Earths fell 5.7%, and several smaller players in the lithium and REE space gave up recent highs.
Gold miners, meanwhile, are well placed to resume leadership today after bullion’s overnight surge.
Commodities and currencies
Gold jumped another 2.8% to US$4,326 an ounce, extending its record-breaking climb as traders priced in further rate cuts from the US Federal Reserve. Silver followed higher, while copper edged up 0.4%. Oil retreated sharply — WTI down 2.2% to US$57.42 — amid signs of softer demand and reports of upcoming Trump-Putin talks on Ukraine that could increase Russian supply.
In bond markets, the US 10-year yield fell below 4% for the first time since early April, driving strength in rate-sensitive sectors. The Australian 10-year also eased to around 4.14% after Thursday’s weaker local jobs data raised the odds of an RBA rate cut in November to roughly 80%.
The Aussie dollar held near US$0.648, steady against a softer greenback.
What’s on today
It’s a light day for data and corporate news, with few major catalysts expected ahead of the weekend.
- Company updates: Australian Finance Group reported a 17.7% year-on-year rise in Q1 mortgage lodgements, while Australian Ethical lifted funds under management to $14.28 billion.
- Dividends paid: Ambertech, ARB, Embelton, and Verbrec.
- Ex-dividend: FFI Holdings.
- Macro: No major Australian releases scheduled; offshore, investors will watch US housing starts, building permits and import prices, depending on government data availability.
In small caps news, archTIS Ltd (ASX:AR9, OTCQB:ARHLF) announced a new A$250,000 US Department of Defense development contract, while Askari Metals Ltd (ASX:AS2) completed the sale of its Burracoppin Gold Project to Forrestania Resources Ltd (ASX:FRS), transferring seven exploration licences and one pending application in Western Australia as part of the transaction.
Looking ahead
Markets remain torn between optimism on rate cuts and anxiety about credit stress. With yields sliding and gold flying, defensives and precious metals may keep outperforming, while financials could stay under pressure near-term.
After a powerful week for the ASX, today’s softer open looks more like a pause than a pullback — a chance for investors to catch their breath before next week’s heavy calendar of quarterly updates and earnings guidance.