The Australian sharemarket is expected to start the week under pressure, although the opening signal may prove less negative after US President Donald Trump delayed further strikes on Iran.
ASX 200 futures on Saturday pointed to a fall of 85 points, or 1%, but were set before Trump said Iran and other Middle Eastern countries had requested time to finalise an agreement that could quickly reopen the Strait of Hormuz.
The development may ease some of the geopolitical concerns that have driven oil prices sharply higher and weighed on global risk sentiment.
ASX edges higher as miners lead
The Australian sharemarket finished slightly higher on Friday as strong gains across the mining sector offset weakness in financial and technology stocks.
The S&P/ASX 200 added 9.1 points, or 0.1%, to close at 8,976.80, with five of the 11 industry sectors ending in positive territory.
Materials stocks led the advance as BHP gained 2% and Rio Tinto rose 1.3%. Fortescue fell 1.9% after flagging a US$525 million, or A$746.8 million, after-tax impairment charge associated with its Iron Bridge project in the Pilbara.
Fortescue also reported record FY26 iron ore shipments of 201.3 million tonnes.
Regional markets strengthened alongside the ASX, with South Korea’s Kospi surging 17% as investors followed a powerful rebound in US artificial intelligence stocks.
Financial stocks were mostly weaker. Commonwealth Bank declined 0.4%, while National Australia Bank and ANZ Bank each lost 0.5%.
HSBC also announced plans to sell its A$36 billion Australian home loan portfolio to private equity group Blackstone and wind down the remainder of its local retail banking operations over the next 18 months.
Technology stocks were mixed. NEXTDC (ASX:NXT) jumped 4.5%, Megaport surged 11.2% and Codan (ASX:CDA) added 4.1%, while WiseTech Global fell 4.1% and Xero declined 2.1%.
Energy stocks moved higher alongside oil prices, with Woodside Energy and Santos both gaining 0.1%. Ampol rose 1% and Viva Energy advanced 2.1%.
Wall Street lifted by Amazon and AI rebound
US sharemarkets ended Friday higher as a strong quarterly result from Amazon revived confidence in artificial intelligence-related stocks.
Amazon surged more than 15% after reporting its strongest quarterly revenue growth in more than four years.
Microsoft gained another 3% after jumping more than 15% on Thursday, its largest one-day percentage rise since 2008, following a stronger-than-expected cloud growth forecast.
Apple fell more than 7% after warning that component shortages would constrain growth, while domain registrar GoDaddy dropped almost 17% after narrowing its annual revenue guidance.
The Dow Jones Industrial Average closed 0.5% higher, the S&P 500 gained 0.7% and the Nasdaq advanced 1%.
For the week, the S&P 500 rose 1.1% and the Nasdaq added 1.6%. The S&P 500 finished July broadly flat, while the Nasdaq fell 3.2%. Both indices remain about 9% higher for 2026.
US Treasury yields also rose after three Federal Reserve policymakers who dissented in favour of a rate increase at last week’s meeting publicly argued for tighter monetary policy.
The US 10-year Treasury yield added six basis points to 4.72%, while the two-year yield rose three basis points to 4.26%.
European markets finish lower
European sharemarkets ended Friday modestly weaker, although the FTSE 100 still recorded weekly and monthly gains supported by strong corporate earnings.
The pan-European FTSEurofirst 300 index declined 0.1%, while the UK’s FTSE 100 fell 0.3%.
Energy stocks gained 1.9% as Brent crude traded above US$90 a barrel.
British Airways owner International Airlines Group fell 1.5% after trimming its 2026 capacity outlook to flat.
IG Group also lost 1.5% after agreeing to acquire US fantasy sports and prediction markets operator Underdog for up to US$1.3 billion, while Universal Music Group (AEX:UMG) declined following its first-half results.
Currencies mixed against US dollar
Major currencies were mixed against the US dollar.
- The euro traded at US$1.1549.
- The Japanese yen was at 157.06 per US dollar.
- The Australian dollar changed hands at US70.53 cents.
Oil rises on Strait of Hormuz concerns
Global oil prices recorded their strongest monthly gains since March as renewed concerns emerged over crude shipments through the Strait of Hormuz.
Reports indicated some tankers had been forced to turn back, while the alternative route through the Bab el-Mandeb Strait remained under pressure from attacks by Iran-backed Houthi forces.
- Brent crude futures settled US$1, or 1.2%, higher at US$90.12 a barrel and gained 24% over July.
However, Trump’s announcement late on Saturday that he had cancelled further attacks on Iran to allow time for negotiations may ease supply concerns when markets reopen.
Base metal prices finished Friday broadly flat.
- Gold futures fell 1.3% to US$4,107 an ounce as the US dollar rebounded from a more than one-month low.
- Iron ore futures also declined, settling at US$95.06 a tonne.
Reporting season and Middle East remain in focus
Corporate earnings and developments in the Middle East are expected to dominate markets this week.
Australia’s August reporting season gathers momentum with Pinnacle Investment Management due to report on Wednesday, REA Group on Thursday and ResMed and James Hardie on Friday.
In the US, results are expected from Palantir, SpaceX and Caterpillar early in the week, followed by pharmaceutical group Eli Lilly and data storage company SanDisk on Wednesday.