The ASX is set for a firmer open on Friday, with futures pointing around 70 points (0.8%) higher at 9:30 am AEST after another record-setting session on Wall Street driven by renewed enthusiasm around AI and semiconductor stocks.
The positive lead follows a choppy local session on Thursday, when late buying in the banks helped the ASX 200 finish slightly higher despite broad weakness across technology, healthcare and consumer sectors.
Wall Street hits new highs again
US equities pushed further into record territory overnight, with the S&P 500 up 0.77% to close above 7,500 for the first time while the Nasdaq and Dow Jones also advanced strongly, up 0.88% and 0.75%, respectively.
Technology stocks again did much of the heavy lifting as investors piled back into the AI trade following strong earnings and guidance from networking giant Cisco.
Cisco surged 13% after the company lifted its revenue forecasts and sharply increased its outlook for AI-related demand from hyperscale customers. The result added fresh momentum to semiconductor and infrastructure names, with Nvidia extending its latest rally and broader chip stocks remaining well bid.
Another major talking point was the blockbuster debut of AI chipmaker Cerebras, whose shares soared after completing the largest IPO of the year so far, raising US$5.55 billion.
The broader tone remained constructive despite rising bond yields and ongoing geopolitical uncertainty, with investors appearing more focused on earnings momentum and AI spending trends.
Bond yields climb as inflation concerns linger
Markets continue to wrestle with the prospect of higher interest rates lasting longer than previously expected.
US Treasury yields pushed back towards yearly highs after stronger retail sales and producer price data reinforced the view that inflation pressures remain difficult to contain.
Investors are now increasingly questioning whether the Federal Reserve will cut rates at all this year under newly confirmed incoming chair Kevin Warsh, with several policymakers reiterating concerns around inflation.
Oil steadies as Trump-Xi talks continue
Energy markets were relatively calmer overnight, though oil prices remain elevated against the backdrop of continuing tensions in the Middle East.
Brent crude held above US$105 a barrel while WTI traded around US$101, with traders closely monitoring developments around the Strait of Hormuz and broader US–Iran negotiations.
At the same time, markets were digesting developments from President Donald Trump’s meeting with Chinese President Xi Jinping in Beijing.
The talks produced a notably softer tone on trade than markets had feared, with both sides signalling support for improved commercial ties and greater Chinese purchases of US goods, including aircraft and agriculture.
There were also signs of progress around semiconductor trade restrictions, with the US reportedly approving limited H200 chip sales from Nvidia to several Chinese technology firms.
Commodities and currencies
Commodity markets delivered a more mixed picture overnight.
- Copper retreated from recent highs amid profit-taking and softer Chinese buying activity
- Gold slipped below US$4,700/oz as rising yields weighed on bullion
- Silver fell nearly 5% to US$83/oz
Currency markets were relatively subdued. The Australian dollar held around US72.2 cents after retracing part of this week’s earlier rally.
Meanwhile, Bitcoin climbed back above US$81,000 as improving risk appetite and AI-related momentum spilled back into crypto markets.
ASX steadies as banks rebound
Locally, Thursday’s trade highlighted the increasingly uneven nature of the Australian market.
The ASX 200 finished just 0.12% higher, though much of the strength came late in the session as Commonwealth Bank rebounded from Wednesday’s heavy post-result sell-off.
Macquarie Group was also strong, while BHP and Rio Tinto continued trading at record levels despite weaker commodity prices overnight.
Elsewhere, the picture was weaker.
Technology stocks slid sharply after disappointing reactions to Xero’s earnings result, while healthcare remained under pressure.
Rare earths and critical minerals stocks also came under renewed selling pressure following a strong recent run, with Lynas dropping almost 10%.
What’s on the radar today
Resources stocks may face a more mixed session after weakness overnight in copper, lithium and gold-related ETFs, even as broader market sentiment improves. Investors will also be watching earnings updates from QBE and Auckland Airport locally, while US industrial production data is due overnight.
For now, markets remain caught between two competing forces — surging AI optimism and still-elevated inflation and energy risks. So far, the AI trade is continuing to win.