Australian shares are expected to open slightly higher today, with futures pointing to a positive start after the Dow Jones Industrial Average advanced on optimism around US-Iran peace talks.
ASX 200 futures were up 21 points, or 0.2%, to 8,831, suggesting local investors may look through weakness in US technology stocks and focus instead on easing oil prices and signs of progress in geopolitical negotiations.
Oil prices fell after US Vice President JD Vance said progress had been made in talks with Iran and that the Strait of Hormuz remained open, easing concerns about disruption to global energy supply.
ASX slips in subdued Monday trade
The Australian share market finished slightly lower on Monday as investors weighed developments in the Middle East against inflation data due later in the week.
The S&P/ASX 200 Index closed 12.6 points, or 0.14%, lower at 8,816.10, after spending much of the session trading sideways. Six of the 11 sectors finished higher.
“The US tends to lead and drive global financial markets, and with the Americans sitting out the result is a duller session,” ETF Shares chief investment officer David Tuckwell said.
Technology was the weakest sector, led by an 18.4% fall in WiseTech Global to $30.08, its lowest level in five years. The decline followed reports the Australian Federal Police was investigating executive chairman Richard White over claims relating to a woman’s immigration status and financial insecurity.
Major miners were also under pressure. BHP fell 1.7% to $60.34, Rio Tinto lost 0.8% to $175.99 and Pilbara Minerals dropped 6% to $5.53.
Gold stocks were stronger as bullion rebounded to around US$4,200 an ounce. Newmont rose 0.8% to $144.68, while Ora Banda Mining gained 6.6% to $1.29.
Energy stocks weakened as oil prices eased. Woodside Energy fell 0.9% to $28.77 and Karoon Energy dropped 3.1% to $1.39.
Financials provided some support, with Commonwealth Bank up 0.6% to $163.41 and ANZ also gaining 0.6% to $35.25. Insurance Australia Group rallied 3% to $8.22 as investors bought into insurers.
Wall Street mixed as tech stocks weigh
US markets were mixed on Monday, with the Dow Jones Industrial Average finishing higher while the S&P 500 and Nasdaq Composite declined under pressure from large technology stocks.
The Dow rose 0.3%, supported by gains in Caterpillar, JPMorgan and Amgen. The S&P 500 fell 0.4%, while the Nasdaq lost 1.3%.
Alphabet dropped 5.1% after Google DeepMind vice president John Jumper said he was leaving for Anthropic, marking the second departure of a key leader from the firm to a rival.
Other megacap technology stocks were also weaker, with Meta, Amazon and Microsoft falling between 2.4% and 4.8%. The communication services index declined 3.8%, while software shares fell to their lowest level in more than 2 months.
SpaceX slid 16.3% to US$154.60 after Bloomberg reported the company was selling investment-grade bonds for the first time.
Despite the weakness in technology, 7 of the 11 major S&P 500 sectors finished higher, with real estate and energy among the better performers.
Among company movers, Apogee Therapeutics jumped almost 47% after AbbVie agreed to acquire the biotechnology company for US$10.9 billion in cash. AbbVie shares rose 6%.
US government bond yields also moved higher as traders positioned for a more hawkish Federal Reserve. The 10-year Treasury yield rose 6 basis points to 4.51%, while the 2-year yield gained 5 basis points to 4.23%.
European markets edge higher
European share markets finished higher as investors assessed the latest US-Iran negotiations and political developments in the United Kingdom.
The continent-wide FTSEurofirst 300 Index rose 0.6%, while the UK FTSE 100 advanced 0.7%.
British banks were stronger, with Barclays up 3.9%, NatWest gaining 4% and Standard Chartered rising 1.3%. The broader banking index added 1.4%.
Investors also responded to the resignation of British Prime Minister Keir Starmer, which is expected to pave the way for an orderly transfer of power to Labour Party frontrunner Andy Burnham.
Technology stocks rose 0.5%, supported by a 4.8% gain in chipmaker Infineon, which tracked advances in Asian equities.
Budget airline easyJet gained 2.8% after US investment company Castlelake went public with a £4.74 billion offer.
Currencies lower against US dollar
Major currencies weakened against the US dollar.
- The euro fell 0.4% to US$1.1426.
- The Japanese yen slipped 0.2% to ¥161.41.
- The Australian dollar declined 0.2% to US69.99 cents.
Commodities: oil and gold fall, aluminium jumps
Global oil prices declined as supply concerns eased following signs of progress in US-Iran talks.
- Brent crude futures settled 3.3% lower at US$77.90 a barrel, while earlier in the session Brent had been quoted down 2.1% at US$78.91.
Base metals were mixed.
- Copper futures fell 0.3%, while aluminium futures surged 4.5% after figures showed global aluminium output fell 1.7% in the year to May.
- Gold futures eased as the US dollar firmed, settling 1% lower at US$4,203 an ounce.
- Iron ore futures were steady, slipping 0.4% to US$100.78 a tonne.
Looking ahead
Investors will be watching flash composite PMI data in Australia, the US and Europe.
In the US, earnings results are due from FedEx and Carnival Corp (NYSE:CCL).