The ASX is set for a strong rebound on Thursday, with futures up 93.1 points (+1.1%) at 9:25 am AEST after easing oil prices and renewed AI enthusiasm helped Wall Street recover from this week’s bond-driven sell-off.
The stronger lead follows a bruising local session on Wednesday, when the ASX 200 dropped 1.26% to a seven-week low as surging global bond yields hammered miners, gold stocks, banks and other rate-sensitive sectors.
Wall Street rallies as yields retreat
US markets recovered strongly overnight after hopes of progress in US-Iran negotiations triggered a sharp pullback in oil prices and eased pressure on bond markets.
The S&P 500 rose 1.08%, the Dow Jones climbed back above 50,000 with a 1.31% gain, and the Nasdaq added 1.54%, while smaller-cap stocks outperformed again.
The turnaround came after President Donald Trump said negotiations with Iran were in their “final stages”, helping calm fears of a prolonged supply shock through the Strait of Hormuz.
That shift flowed quickly into bond markets. US Treasury yields eased after several sessions of aggressive selling, with the 10-year yield retreating to around 4.57% after briefly peaking at 4.7% earlier in the week.
The relief rally also interrupted what had become an increasingly uncomfortable backdrop for equities, with markets recently rattled by rising long-term borrowing costs globally.
Still, investors remain cautious about the broader interest-rate outlook.
Minutes from the Federal Reserve’s April meeting showed policymakers growing increasingly concerned inflation could remain elevated for longer, with several officials indicating further rate increases may still be possible if price pressures fail to ease.
Nvidia delivers another blockbuster quarter
Technology sentiment also received another boost after Nvidia again beat expectations with a huge earnings result after the bell.
The AI chip giant reported quarterly revenue of US$81.6 billion, up 85% year-on-year, while forecasting current-quarter revenue of around US$91 billion — comfortably ahead of analyst forecasts.
Nvidia also announced an additional US$80 billion share buyback and lifted its dividend, reinforcing investor confidence that AI-related infrastructure spending remains exceptionally strong.
Oil tumbles as diplomacy hopes improve
Energy markets were a major driver overnight after oil prices recorded their sharpest one-day decline in roughly a month.
WTI crude fell almost 5% to around US$99 a barrel, while Brent slipped towards US$105 as traders scaled back some of the extreme supply-risk premium built into prices during recent weeks.
Shipping activity through the Strait of Hormuz also showed tentative signs of improvement, with several supertankers reportedly resuming movement through the region.
Even so, tensions remain elevated.
Iran’s Revolutionary Guard warned of potential retaliation if the US resumes military action, while uncertainty around any lasting diplomatic breakthrough continues to keep energy markets volatile.
Commodities and currencies
Beyond oil, commodity markets were mixed overnight, though broader sentiment improved. Copper rose more than 2%, extending its powerful recent rally, while gold rebounded above US$4,500/oz after recent heavy selling.
Strategic metals, uranium and lithium-related ETFs also rebounded strongly in US trade, suggesting local critical minerals names may stabilise after several volatile sessions.
The Australian dollar strengthened slightly to around US71.5 cents as the US dollar softened.
Meanwhile, volatility indicators eased back, with the VIX slipping below 18.
ASX hit hard by bond market fears
Locally, Wednesday’s sell-off reflected growing concern that higher global bond yields may begin weighing more heavily on valuations across equity markets.
Gold stocks were among the worst performers as rising yields reduced the appeal of non-income-producing assets, while miners also came under pressure despite relatively resilient commodity prices.
Banks, real estate and utilities weakened sharply as investors reassessed the outlook for interest rates both globally and domestically.
There were still pockets of resilience. Consumer staples outperformed as investors rotated towards more defensive earnings exposure, while TechnologyOne and Catapult Sports both rallied strongly after recent earnings updates.
What’s on today
Locally, attention will turn to Australia’s unemployment data at 11:30 am AEST, with markets watching closely for any signs labour market strength could complicate the RBA’s inflation fight.
There is also plenty of corporate activity on the calendar, including SkinKandy’s ASX debut and earnings from Australian Agricultural Co.
Small-cap news flow has also been relatively light so far this morning, though Resolution Minerals Ltd (ASX:RML, OTCQB:RLMLF, FRA:NC3) reported encouraging early signs from drilling at its Horse Heaven project in Idaho.
The company said the first three holes of its 2026 Golden Gate drill campaign had all intersected strong sulphides, alteration and veining associated with potential gold and tungsten mineralisation, with a second rig arriving next week as the company ramps up its 2026 campaign.
After several volatile sessions dominated by oil and bond yields, markets appear to have found at least temporary relief overnight — though inflation, rates and geopolitics remain firmly in the background.