Australian shares are set to open lower, tracking an extended sell-off on Wall Street overnight. ASX 200 futures were down 98 points, or 1.1%, pointing to an opening level of 8,752.
Yesterday, Australian shares snapped a two-day winning streak as renewed volatility in global metals markets weighed heavily on resource stocks.
The S&P/ASX 200 fell 0.4%, or 38.60 points, to 8,889.20, with three of the 11 sectors ending lower. Materials led the decline after sharp losses across precious and base metals reignited concerns about price stability.
Copper slid more than 3% to US$13,044 a tonne by the Sydney close, while silver plunged 12.7% to US$77 an ounce and gold fell 1.8% to US$4,878 an ounce, extending a historic sell-off earlier in the week.
Capital.com senior market analyst Kyle Rodda said the extreme moves reflected positioning rather than fundamentals following the nomination of Kevin Warsh as a US Federal Reserve governor.
“When volatility erupts in a market so violently, it takes time for it to become efficient again,” Rodda said. “The fundamentals for gold and silver haven’t materially changed. This event is about positioning and sentiment.”
On the ASX, BHP dropped 3.9% to $50.36 as investors locked in gains from the previous session. South32 fell 4% to $4.60 and Sandfire Resources slid 5.8% to $18.91 amid weaker copper prices.
Gold miners also came under pressure, with Northern Star down 4.6% to $27.24, Newmont falling 5.3% to $162.83 and Genesis Minerals losing 6% to $6.87.
Uranium stocks were among the session’s steepest decliners after a sharp sell-off in US technology stocks raised fresh doubts over AI-driven data centre growth. Paladin Energy dropped 9% to $12.36, NexGen Energy slid 9.2% to $16.53 and Deep Yellow fell 6.4% to $2.50.
US: Weak jobs data deepens equity sell-off
US sharemarkets fell sharply overnight as weaker-than-expected labour market data compounded an equity rout already fuelled by concerns around artificial intelligence valuations.
The Dow Jones Industrial Average fell 593 points, or 1.2%, while the S&P 500 slipped 1.2% and the Nasdaq Composite shed 1.6%.
Technology stocks led losses. Alphabet fell 0.5% after flagging plans to double capital expenditure this year to bolster its AI push. Qualcomm slumped 8.5% after forecasting second-quarter revenue and earnings below expectations, citing a global memory shortage. Amazon dropped 4.4% ahead of its quarterly results.
Software and data services names were also weaker, with ServiceNow down 7.6% and Salesforce off 4.8%. Consumer stocks lagged, with Estée Lauder plunging 19.2% after forecasting full-year results below estimates.
Economic data added to recession concerns. JOLTS job openings fell to 6.54 million in December, the lowest level since 2020, while initial jobless claims rose to 231,000. Challenger data showed employers announced 108,435 job cuts in January, the highest January figure since 2009.
Europe: Miners Slide as Central Banks hold steady
European sharemarkets ended lower, dragged down by mining stocks and lingering growth concerns.
Glencore shares fell 7%, while Rio Tinto’s London-listed stock lost 2.6% after confirming it was no longer in takeover talks with Glencore, ending speculation around a potential mega-merger.
The FTSEurofirst 300 index slipped 1%, while the UK’s FTSE 100 fell 0.9%.
Central banks remained cautious. The European Central Bank held interest rates at 2% as expected, with President Christine Lagarde saying inflation was “in a good place.” The Bank of England also left rates unchanged, but a narrow 5–4 vote highlighted growing internal support for cuts if inflation continues to ease.
Currencies: Aussie dollar slips
Currency markets were mixed.
- The euro edged higher to around US$1.18.
- The Australian dollar fell from US69.89 cents to near US69.35 cents at the US close.
- The Japanese yen strengthened modestly, trading near JPY157 per US dollar.
Commodities: Oil, Metals and Iron Ore Retreat
- Oil prices fell almost 3% after the US and Iran agreed to hold talks in Oman, easing concerns about potential disruptions to Iranian crude supply.
- Brent crude dropped 2.7% to US$67.55 a barrel, while US Nymex crude fell 2.8% to US$63.29.
Base metals were weaker, with copper futures down 0.5% and aluminium falling 1.6% amid rising inventories and a firmer US dollar.
- Gold futures settled 1.2% lower at US$4,889.50 an ounce, while spot gold was near US$4,808 at the US close.
- Spot silver tumbled around 14% to US$72.95 an ounce.
- Iron ore futures slipped 1.1% to US$101.03 a tonne as elevated inventories limited upside.
Looking ahead
In Australia, Reserve Bank Governor Michele Bullock appears before the House of Representatives Standing Committee on Economics. Earnings are due from News Corp and REA Group, while Sandfire Resources hosts an investor briefing.
In the US, consumer confidence data is released, with results expected from Centene, Philip Morris, Biogen and Under Armour.