The Australian sharemarket is set to rise at the open, with futures pointing to a gain of 44 points, or 0.5%, after Wall Street ended mixed in a holiday-shortened session and investors weighed softer US labour market data.
ASX avoids third straight loss
The local market finished virtually flat on Thursday, avoiding a third consecutive session of losses after a rebound in banking stocks helped offset early weakness.
The benchmark S&P/ASX200 index added 1.6 points, or 0.02%, to close at 8,724.5, while the broader All Ordinaries slipped 0.5 points to 8,930.9.
IG analyst Tony Sycamore said the ASX200 had fallen 66 points at the open to a three-week low of 8,656.20 before fresh buying, likely linked to the start of the new financial year, helped the market recover its losses.
Despite the flat finish, only two of the ASX’s 11 sectors closed higher: healthcare and financials.
Financials rose 1.2% after a weaker session on Wednesday, with all four major banks finishing higher.
NAB led the gains, rising 3.8% to $38.41, while Westpac added 2.2% to $35.46. ANZ climbed 0.9% to $34.79 and Commonwealth Bank edged up 0.3% to $161.14.
Gold stocks also found support as bullion rebounded to around US$4,077 an ounce after a dip earlier in the week. Evolution Mining gained 1.9%, Northern Star rose 5.5% and Newmont added 2.6%.
Among the major miners, BHP fell 0.6% to $59.57, Rio Tinto added 0.3% to $171.27 and Fortescue lost 1.5% to $18.96.
US markets mixed as tech slides again
US sharemarkets finished the holiday-shortened week little changed as early gains from a cooler-than-expected jobs report were erased by renewed weakness in technology stocks.
The Philadelphia Semiconductor Index fell 5.4% as chip stocks sold off, with investors taking profits after a strong recent run. KLA dropped 12%, Sandisk sank 14% and Marvell Technology fell 10%.
Tesla shares lost 7.5% despite the electric vehicle maker posting second-quarter deliveries ahead of estimates, with the stock having rallied ahead of the update.
Defensive sectors performed better as investors rotated away from technology, with consumer staples, utilities and healthcare stocks gaining ground.
The Dow Jones Industrial Average rose 1.1%, marking its fourth consecutive weekly gain and its longest such run since October 2024. The S&P 500 was flat, while the Nasdaq lost 0.8%.
In economic data, US nonfarm payrolls increased by 57,000 jobs last month, well below the 110,000 expected by economists polled by Reuters. Following the report, expectations for a Federal Reserve rate hike eased, with CME FedWatch showing September hike expectations falling to 55% from 64.1%.
Europe rises as healthcare offsets tech weakness
European sharemarkets finished higher as broad-based sector gains offset weakness in AI-related stocks.
Healthcare led the market higher, rising 3.3%, with Bayer gaining 8.9% after announcing it would consolidate its US Roundup business into a new unit, Ruveon, following a major legal victory that blocked thousands of state-court lawsuits alleging its weedkiller causes cancer.
Consumer-facing sectors also advanced, with personal and household goods up 2% and food and beverages rising 2.2%.
Technology was the only sector in the red, falling 2.1%.
The continent-wide FTSEurofirst 300 index rose 1.4%, while the UK’s FTSE 100 gained 1.7%.
Currencies higher against US dollar
Major currencies strengthened against the US dollar following the softer US jobs data.
- The euro advanced 0.5% to US$1.1433.
- The Japanese yen climbed 0.9% to JPY161.09.
- The Australian dollar rose 0.4% to around US69.20 cents.
Commodities mixed as gold gains
Global oil prices advanced after data showed oil flows through the Strait of Hormuz surged to 14 million barrels on July 1.
- Brent crude futures settled 0.3% higher at US$71.80 a barrel.
Base metals were mixed.
- Copper futures dipped 0.1%, while aluminium rebounded 0.9% as the US dollar weakened following the jobs report.
- Gold futures gained as the softer labour data lowered expectations of further US rate hikes this year, settling 1.1% higher at US$4,126 an ounce.
- Iron ore futures were steady despite China moving to restrict deliveries of certain Fortescue products to some local steel mills, tightening supply in the world’s largest market for the steelmaking ingredient. Futures slipped 0.1% to US$98.25 a tonne.
US markets will be closed on Friday for the Independence Day holiday.