Australian shares are expected to start Thursday on a firmer footing after Wall Street pushed closer to record highs, supported by strong results from artificial intelligence-linked companies and slightly softer US inflation data.
US technology stocks led gains overnight, with CoreWeave, Nebius Group and Super Micro Computer surging on stronger-than-expected results and forecasts, while Nvidia and Micron Technology also advanced.
Locally, investors will turn their attention to another busy day of corporate earnings, including results from Telstra, Transurban, Origin Energy, Treasury Wine Estates, ASX, Insurance Australia Group, Orora and HomeCo Daily Needs REIT.
Assistant RBA Governor Christopher Kent is also due to speak at an event in Sydney.
ASX slips as banks and supermarkets weigh
The Australian sharemarket closed lower on Wednesday, with weakness across the banking, mining and consumer sectors outweighing gains among energy stocks.
The S&P/ASX 200 finished 41.20 points, or 0.45%, lower at 9,209.40, with 9 of the 11 sectors ending in negative territory. The benchmark had gained 0.2% on Tuesday.
Commonwealth Bank of Australia (ASX:CBA) was volatile after reporting full-year cash profit of $11 billion, up 7%, supported by growth across its loan and deposit portfolios.
Despite the strong result, CBA warned that economic conditions were becoming more challenging as higher interest rates and inflation weighed on households.
“Growth is slowing, with higher interest rates and inflation placing uneven pressure on household incomes and economic activity,” chief executive Matt Comyn said. “Housing activity has softened from a high base.”
CBA said new mortgage applications had fallen 15% since the May budget, while costs associated with soured loans had increased amid cost-of-living pressures and economic uncertainty.
CBA shares finished 0.69% lower after falling as much as 2.2% early in the session before briefly trading 1.5% higher.
National Australia Bank dropped 0.85%, Westpac Banking Corp declined 0.9% and ANZ Group Holdings lost 0.6%.
Miners retreat, AGL jumps
Major miners also weighed on the market, with BHP falling 0.75%, Rio Tinto easing 0.24% and Fortescue declining 0.33%.
Gold stocks performed better, with Northern Star Resources gaining 0.66% and Evolution Mining adding 0.14%.
Among individual stocks, Seek plunged 14.31% after reporting a full-year net loss of $307 million, reflecting investment losses from the Seek Growth Fund and write-downs associated with Chinese recruitment platform Zhaopin.
Premier Investments tumbled 11.01% after reporting a 2% decline in annual sales to $795.5 million and trimming its underlying earnings forecast to $176 million. The company will also close its 3 Peter Alexander stores in the UK, citing difficult trading conditions.
Energy was one of the few sectors to advance.
AGL Energy (ASX:AGK) jumped 5.95% after full-year statutory net profit increased 575% to $756 million, helped by the divestment of Tilt Renewables (ASX:TLT) and revaluation of legacy contracts. Underlying profit fell 1.7% to $631 million, broadly in line with expectations.
Origin Energy gained 2.93%.
Wall Street lifted by AI stocks and inflation data
US sharemarkets mostly advanced as strong earnings from AI infrastructure companies and relatively benign inflation figures supported sentiment.
The Dow Jones finished broadly flat, while the S&P 500 gained 0.3% and the Nasdaq added 0.5%.
CoreWeave surged 19% after the AI cloud infrastructure company lifted its annual capital expenditure forecast and exceeded second-quarter earnings expectations.
Data centre operators also rallied, with IREN gaining 10%, Applied Digital rising 4% and Nebius Group jumping 34% following better-than-expected quarterly results.
Super Micro Computer surged 19% after the AI server manufacturer forecast fiscal 2027 revenue above Wall Street expectations.
Semiconductor stocks were also stronger. Nvidia rose 3%, Micron Technology gained 5% and the semiconductor index advanced 2.5%.
Elsewhere, restaurant chain Cava Group jumped 14% after beating expectations for second-quarter sales and underlying earnings.
Investors were also encouraged by US inflation figures showing consumer prices increased just 0.1% in July as gasoline prices declined for a second consecutive month.
Annual CPI inflation stood at 3.4%, while underlying inflation remained relatively contained, reducing expectations that the Federal Reserve will raise interest rates at its September meeting.
US Treasury yields were mixed. The 10-year yield held around 4.69%, while the 2-year yield eased 1 basis point to 4.20%.
European markets retreat from records
European markets eased from record highs as investors assessed corporate earnings and developments in the Middle East.
The continent-wide FTSEurofirst 300 index declined 0.2%, while the UK FTSE 100 lost 0.1%.
Healthcare stocks dropped 1.2%, with EssilorLuxottica falling 4.3% after a German advocacy group filed a criminal complaint relating to Meta's AI-enabled glasses and alleged breaches of privacy laws.
Personal and household goods stocks led sector losses, declining 1.9%.
Nokia was a notable outperformer, jumping 9.6% after US optical components manufacturer Lumentum issued a stronger-than-expected forecast.
Currencies mixed
Currency markets were mixed against the US dollar.
- The euro fell 0.2% to US$1.1522.
- The Japanese yen weakened 0.1% to ¥159.47.
- The Australian dollar was broadly unchanged at US70.61 cents, compared with around US70.58 cents during Wednesday's local session.
Gold rises as oil steadies
Global oil prices were little changed after the OECD and International Energy Agency reduced their forecasts for global oil demand in 2026.
- Brent crude futures gained 0.1% to settle at US$88.98 a barrel.
Base metals were weaker.
- Copper futures fell 0.2%.
- Aluminium dropped 1.4%. Aluminium came under pressure after major producer Emirates Global Aluminium reaffirmed plans to return its war-damaged smelter to full-scale production.
- Gold rallied to its highest level in more than 2 months as softer US inflation data reduced expectations for further Federal Reserve rate increases.
- Gold futures settled 0.6% higher at US$4,468 an ounce.
- Iron ore futures were steady at US$95.09 a tonne.
What to watch today
Australian investors face another heavy corporate reporting schedule, with Telstra, Transurban, Origin Energy, Treasury Wine Estates, ASX, Insurance Australia Group, Orora and HomeCo Daily Needs REIT among companies due to report.
Assistant RBA Governor Christopher Kent is also scheduled to speak in Sydney.
In the US, attention will turn to weekly jobless claims and the Producer Price Index for further signals on inflation and the labour market.
Applied Materials and JD.com are among the major companies scheduled to release earnings.