Australian shares are expected to open higher today, with ASX 200 futures up 28 points (+0.34%) as of 8:30 am AEST, following a strong session on Wall Street. The S&P 500 logged its sixth consecutive day of gains, climbing 0.58% to close at 5,561 — its most sustained rally since March 2022. Investor sentiment was boosted by trade-related optimism and a wave of earnings announcements, despite a backdrop of geopolitical trade tensions and tariff-related uncertainty.
U.S. Markets Push Higher Amid Tariff Relief Hopes
The momentum in U.S. equities continued with all major indices finishing in the green. The Dow Jones rose 0.75% to 40,528, while the tech-heavy NASDAQ gained 0.55% to reach 17,461. Small-cap stocks also participated in the rally, with the Russell 2000 up 0.56%. Markets were encouraged by reports suggesting a potential softening of U.S. tariffs on foreign-made vehicles. Although specifics remain unclear, comments from Cantor Fitzgerald CEO Howard Lutnick hinted at a possible trade deal — bolstering investor confidence.
Despite rising trade tensions globally, particularly between the U.S. and China, Wall Street held firm. Comments from President Trump suggest that an executive order will soon be signed to mitigate the cumulative impact of tariffs on auto imports, providing a temporary buffer for manufacturers and consumers alike.
Global Equities Mostly Positive
Asian and European markets posted modest gains. Japan’s Nikkei rose 0.38%, while Germany’s DAX surged 0.69%. In contrast, China’s benchmark index edged down 0.05% as Beijing reiterated it would not engage in market flooding amid rising U.S. tariffs. The UK FTSE added 0.55%, and India’s Sensex ticked up 0.09%, indicating generally stable investor sentiment across global equities.
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Commodities Decline; AUD Drops
Commodities were broadly lower. Gold slipped 0.49% to US$3,321.05 per ounce, while copper dropped 0.83% to US$4.81 per pound. Oil prices took the biggest hit, with WTI crude falling 2.63% to US$60.42 amid ongoing concerns around global demand and rising U.S. inventory levels. This weighed on energy stocks, which were the only sector in the red during the U.S. session.
The Australian dollar also weakened, falling 0.70% to US$0.6385, reflecting a stronger U.S. dollar and concerns around Australia’s trade exposure to China.
Sector Performance: Financials and Materials Lead
In the U.S., Financials led sector gains, rising 0.97%, followed closely by Materials (+0.92%) and Consumer Staples (+0.77%). Real Estate and Utilities also posted solid returns. Energy was the lone decliner, slipping 0.37% in response to weaker oil prices. The Information Technology sector rose 0.46%, supported by resilient demand for AI and cloud infrastructure.
Among major stocks making headlines, Amazon confirmed it will not disclose U.S. tariff costs on product listings, while Pfizer’s CEO warned that ongoing tariff volatility could lead to reduced domestic investment and up to $150 million in added costs. Coca-Cola announced it is holding prices steady despite rising import costs, while UPS is set to cut 20,000 jobs, citing unprecedented trade uncertainty.
Heavy Earnings Calendar Ahead
Investors are bracing for a wave of earnings reports today, including quarterly updates from major Australian miners such as Champion Iron and Perseus Mining. On the global front, eyes remain on upcoming results from several ‘Magnificent 7’ U.S. tech firms.
Spotify shares tumbled after reporting disappointing margins and monthly active user growth, while AstraZeneca surprised with strong profits, buoyed by diabetes drug sales despite lagging cancer treatment revenues. Meanwhile, Deutsche Bank delivered its best quarterly pre-tax profit in over a decade, thanks to robust performance in investment banking.
Tariff Tensions Simmer
Trade remains a hot-button issue globally. China reiterated its refusal to engage in tariff negotiations with the U.S., while simultaneously urging other nations to resist “bullying” tactics. Japan expressed concerns that continued U.S. tariff hikes could draw Asian economies closer to China, potentially realigning global trade dynamics.
In contrast, some reassurance came from China’s promise not to flood global markets with low-cost goods, a gesture aimed at calming fears of supply gluts and deflationary pressure.
Economic Updates
Spain reported a GDP growth slowdown to 0.6% for Q1, though still outperforming much of the Eurozone. All eyes are now on a deluge of macroeconomic data set to be released in the next 24 hours, which could influence central bank rate expectations and market direction.
Industry ETFs Show Mixed Moves
ETFs tracking strategic metals, steel, and lithium posted modest gains, reflecting continued interest in electric vehicle infrastructure and critical minerals. In contrast, gold miners and agricultural ETFs declined, weighed down by falling commodity prices and currency volatility.
Outlook
With global equities largely in positive territory and trade-related fears temporarily offset by easing rhetoric, the ASX 200 looks poised to extend its recent rally. However, ongoing earnings results, economic data releases, and geopolitical developments — especially around U.S.-China relations — will likely shape market sentiment in the days ahead.
