Australian shares are expected to open higher on Monday after Wall Street finished Friday’s session in positive territory, although renewed military strikes in Iran could temper early optimism.
ASX futures were pointing to a 43-point, or 0.49%, gain for the S&P/ASX 200 at 6am AEST.
ASX snaps four-day losing streak
The Australian sharemarket broke a four-session losing run on Friday, although the benchmark still finished the week lower as a global rally in artificial intelligence and semiconductor stocks largely bypassed the local market.
The S&P/ASX 200 rose 43.5 points, or 0.5%, to 8,806, while the broader All Ordinaries gained 42.4 points, or 0.47%, to 9,003.7.
Mining stocks rebounded after falling more than 4% over the week, led by gains for BHP, Rio Tinto and gold producers as commodity prices strengthened.
Gold traded near US$4,118 an ounce on Friday, although the All Ordinaries Gold Index still ended the week more than 5% lower.
Energy stocks slipped 0.2% as oil prices eased on expectations that the worst of the US-Iran conflict may have passed, despite further escalation over the weekend.
Woodside Energy and Santos traded lower, while uranium stocks provided some support amid renewed interest in the energy requirements of artificial intelligence and expectations that Australia could increase uranium exports to India.
Financial stocks added 0.6%, recording their strongest daily close in nine weeks as the major banks continued to recover from a weak second quarter.
Healthcare, consumer discretionary and communication services stocks underperformed.
Telstra and WiseTech fall while Mesoblast rallies
Telstra Group Ltd extended its decline following last week’s major network outage, with an apology from chief executive Vicki Brady failing to ease concerns about possible fines, compensation payments and reputational damage.
Telstra shares fell 1.6%.
The Finance Sector Union also accused Commonwealth Bank of using “fake” redundancies to move Australian jobs offshore, alleging that similar roles were subsequently advertised by the bank’s Indian subsidiary.
WiseTech Global Ltd fell 1.8% as the logistics software company sought to dismiss speculation that it was at risk of losing a major customer.
The decline came days after WiseTech shares rallied following news that co-founder Richard White would step away from his lead board role.
Mesoblast Ltd (NASDAQ:MESO, ASX:MSB) was among the strongest performers, climbing more than 6% after reporting US$115 million in FY2026 revenue from its mesenchymal stromal cell therapy Ryoncil.
Wall Street lifted by AI and chip stocks
US sharemarkets closed higher on Friday as strong demand for the US listing of South Korean semiconductor group SK Hynix renewed enthusiasm for memory-chip and artificial intelligence stocks.
Eight of the 11 S&P 500 sectors advanced, led by a 1.65% rise in information technology and a 1.46% gain for consumer discretionary stocks.
SK Hynix finished 13% above its US$149 offer price at US$170 after raising more than US$26 billion through the sale of American Depositary Receipts.
Nvidia gained 4%, while Meta Platforms jumped 6% to its highest level since April as investor confidence improved around the company’s AI strategy.
Delta Air Lines fell 1.8% despite forecasting third-quarter profit above market expectations.
The Dow Jones Industrial Average gained 0.3%, the S&P 500 added 0.4% and the Nasdaq Composite rose 0.3%.
US government bond yields increased as investors assessed renewed tensions between the United States and Iran and the inflationary risks posed by disruptions to shipping through the Strait of Hormuz.
The US 10-year Treasury yield rose one basis point to 4.56%, while the two-year yield increased three basis points to 4.21%.
European markets end winning streak
European sharemarkets finished mixed on Friday and ended a four-week run of gains as technology stocks weakened and tensions in the Middle East unsettled investors.
The European technology sector fell 1.3% on Friday and 1.8% over the week, with semiconductor companies Soitec and ASML dropping 5.9% and 2.1% respectively.
Telecommunications stocks gained 1.3%, supported by a 13% surge in Vodafone after UAE-based telecoms group e& agreed to sell its stake to the family investment group of French billionaire Xavier Niel.
Travel and leisure stocks advanced 1%, with airlines generally higher.
EasyJet surged 14.3% after agreeing in principle to a £5.7 billion takeover offer from Apollo Global Management (NYSE:APO).
The pan-European FTSEurofirst 300 index finished broadly flat, while the UK’s FTSE 100 gained 0.2%.
Australian dollar holds near US69.5 cents
Major currencies weakened against the US dollar as investors moved toward defensive assets amid continued geopolitical uncertainty.
- The euro traded at US$1.1401.
- The Japanese yen weakened to ¥161.69 per US dollar.
- The Australian dollar was slightly lower at US69.46 cents on Friday before recovering to around US69.50 cents early Monday.
Oil retreats but records strong weekly gain
Oil prices settled lower on Friday as traders became increasingly optimistic that shipping through the Strait of Hormuz would eventually resume. That feeling could be revertsed thgis week as the US and Iran resume hostilities.
Brent crude futures declined 0.4% to US$76.01 a barrel but still recorded a sharp weekly gain following continued fighting between the United States and Iran.
Base metal prices were mixed.
- Copper futures rose 0.3%, while aluminium fell 2.3% after Emirates Global Aluminium restarted its alumina refinery in the United Arab Emirates following a three-and-a-half-month outage.
The restart added to expectations that Gulf-region metals production would begin returning to normal levels.
- Gold futures fell 0.7% to US$4,114 an ounce as higher oil prices increased inflation concerns and strengthened expectations that US monetary policy could remain restrictive.
- Iron ore futures gained 0.2% to US$98.72 a tonne, supported by seasonally lower Australian shipments, higher freight costs and declining inventories at major Chinese ports.
Economic data and earnings in focus
Australian investors will turn their attention to the Westpac consumer sentiment survey and NAB business confidence figures due on Tuesday.
In the United States, the second-quarter earnings season will accelerate this week, beginning with results from the major banks before attention shifts to large technology companies next week.