The Australian sharemarket is expected to open lower on Monday, with ASX 200 futures down 33 points, or 0.36%, at 8:30 am AEST.
The softer lead follows the Australian market’s worst week since April, with investors taking some money off the table amid weaker commodity prices, uncertainty around company earnings and elevated equity valuations.
Attention will remain firmly on reporting season, with results due today from JB Hi-Fi, a2 Milk, Aurizon, BlueScope Steel (ASX:BSL), GPT GROUP (ASX:GPT), Lendlease, IRESS and Growthpoint Properties, while NAB is scheduled to provide a quarterly update.
Later in the week, BHP, CSL, Cochlear and Pro Medicus are among the major companies reporting on Tuesday.
Investors will also be watching Australia’s wage price index on Wednesday and employment figures on Thursday for further clues on the economic outlook.
ASX records worst week since April
The S&P/ASX 200 fell 73.3 points, or 0.8%, to 9,115.2 on Friday, while the All Ordinaries lost 68.2 points, or 0.73%, to 9,313.2.
That left the ASX 200 down 1.6% for the week, with financial stocks among the biggest drags.
Housing market concerns weighed on the banks, while weaker copper and gold prices pressured the miners.
BHP fell more than 3% to $61.35 as copper prices declined for a fourth consecutive session.
Reporting season has so far delivered a mix of earnings beats and misses. With valuations close to record highs, investors have been demanding strong results before committing further capital.
Energy stocks eased on Friday but still gained 2.8% across the week, supported by firm oil prices as hopes faded for an agreement to reopen the Strait of Hormuz.
Utilities, healthcare and information technology were the only other sectors to finish the week higher, benefiting from defensive buying, bargain hunting and some company-specific earnings results.
Consumer stocks were weaker as broader economic concerns weighed on expectations for household spending.
Upcoming results from JB Hi-Fi, Temple & Webster, Breville, Super Retail and Zip Co should provide further insight into consumer conditions.
Other companies reporting during the week include Goodman Group, Santos, Charter Hall, Northern Star Resources, Whitehaven Coal, Vicinity Centres, Dexus, Inghams and Telix Pharmaceuticals.
Wall Street slips but posts another positive week
US sharemarkets finished modestly lower on Friday as weakness in semiconductor stocks offset some support from softer retail sales data.
The Dow Jones fell 0.2%, the S&P 500 declined 0.2% and the Nasdaq lost 0.3%.
Despite Friday’s retreat, the S&P 500 gained 0.4% for the week and the Nasdaq added 0.1%, giving both indices a third consecutive weekly advance.
Applied Materials fell 5.1% after its quarterly outlook failed to meet elevated investor expectations, despite continued strong demand associated with artificial intelligence data centre investment.
Other semiconductor stocks also retreated, with Broadcom down 5.9% and Intel losing 2% as investors remained cautious about valuations across AI-related companies.
Reddit jumped almost 13% after being named as a new addition to the S&P 500 index, effective August 18.
Workday fell 3.8%, giving back part of Thursday’s 18% surge following reports that private equity firm Silver Lake was in talks to acquire the software company.
US Treasury yields initially fell after weaker-than-expected retail sales data before reversing course.
Retail sales declined 0.6% in July, following an unrevised 0.2% increase in June and marking the first fall in 9 months.
The US 10-year Treasury yield rose 5 basis points to 4.69%, while the 2-year yield added 3 basis points to 4.17%.
The Empire State Manufacturing Index for August is due in the US today.
European markets end four-week winning streak
European equities finished lower on Friday as higher crude oil prices and renewed geopolitical concerns outweighed support from corporate earnings.
The continent-wide FTSEurofirst 300 fell 0.2%, while the UK’s FTSE 100 also declined 0.2%, snapping a four-week run of gains for European markets.
Healthcare stocks were among the weakest performers, falling 1.5%, with Zealand Pharma down more than 5.8%.
Defence stocks moved in the opposite direction, gaining 1.2%, led by a rise of more than 3.2% for Rheinmetall.
European software stocks advanced 2.7% after reports of private equity interest in US software group Workday boosted sentiment across the sector.
Nemetschek gained 8% and Temenos added 2%.
Elsewhere, British insurer Aviva rose 1.8% after beating first-half profit expectations, while shipping group Maersk gained 9% to reach its highest level in 4 years after stronger-than-expected quarterly results and an upgraded outlook.
Currencies steady after weaker US retail sales
Major currencies were relatively steady against the US dollar this morning after mostly strengthening on Friday following the surprise decline in US retail sales.
- The euro was trading at US$1.1569.
- The Japanese yen was at ¥159.30 per US dollar.
- The Australian dollar was trading at US70.90 cents.
Oil climbs as geopolitical tensions persist
Global oil prices moved higher as tanker attacks continued and there was little sign of progress toward a peace agreement between the Trump administration and Iran’s leadership.
- Brent crude futures rose 1.7% to settle at US$88.52 a barrel.
Base metals were mixed, with copper futures slipping 0.1% and aluminium falling 1.1% on profit-taking.
- Gold futures gained as a weaker US dollar and inflation data reinforced expectations that the US Federal Reserve could leave interest rates unchanged next month.
- Gold settled 0.4% higher at US$4,437 an ounce.
- Iron ore futures edged 0.1% lower to US$95.17 a tonne.