The Australian share market opened lower on Friday, with the S&P/ASX 200 Index shedding 39.10 points or 0.51% to 7,670.50 as of 10:00 am AEST. The downbeat start comes on the heels of a sharp sell-off on Wall Street, particularly the tech-heavy Nasdaq, which plunged 737 points overnight, triggering ripple effects across global markets.
The ASX 200 had opened at 7,709.60, matching the previous close, but weakness quickly set in as investors reacted to a deteriorating global risk sentiment. With no immediate domestic catalysts to offset global trends, the local bourse followed its international counterparts into the red.
Global Headwinds Shake Investor Confidence
The primary driver behind today’s soft open was the unexpectedly strong U.S. Consumer Price Index (CPI) data released on Thursday. Inflation figures exceeded market expectations, reigniting fears that the Federal Reserve may delay anticipated interest rate cuts. The possibility of a more hawkish monetary policy stance in the United States has sent shockwaves across equity markets globally, with growth and tech stocks bearing the brunt of the sell-off.
The Nasdaq Composite’s 4.31% drop was among its worst single-day performances in recent months, and Asian markets were quick to respond. The Hang Seng Index lost 124 points in early trade, while Japan’s Nikkei 225 slumped more than 5% in the first hour of trading. Against this backdrop, the Australian market’s weakness appears in line with global sentiment.
Also Read: US Markets Slip as Initial Tariff Reversal Optimism Fades Amid Inflation Concerns
Sector-Wise Performance: Tech, Energy Under Pressure
On the ASX, sectors with heavy exposure to global risk and interest rate sensitivity—particularly technology and energy—were the early underperformers.
- Tech stocks mirrored the Nasdaq’s retreat, as rising bond yields and concerns over profitability in a high-interest-rate environment put pressure on valuations.
- Energy stocks also traded lower, reacting to weaker crude prices. WTI Crude fell by 0.45%, trading near $60.01 per barrel. Lower oil prices tend to hurt Australian energy giants, many of whom are major index contributors.
- Financials presented a mixed picture, with some profit-taking seen after recent rallies, while bond market movements kept bank stocks volatile.
On the upside, defensive sectors and utilities managed to remain relatively stable, drawing support from risk-averse investors seeking safer havens in times of market uncertainty.
Key Market Metrics – ASX 200 Opening Snapshot
Technical Outlook: Levels to Watch
According to technical analysts, the 7,660 level serves as an immediate support for intraday trades. A breakdown below this threshold could see the index test further support around 7,630. On the flip side, resistance is expected near 7,700, with a more solid ceiling at 7,740.
“If the index fails to hold above 7,660, we might see another leg down,” a Sydney-based trader commented. “Momentum is fragile and heavily dependent on U.S. futures and commodity cues.”
Australian Dollar and Commodity Impact
The Australian dollar was slightly firmer during the morning session, a factor that could potentially weigh on local exporters. While a stronger AUD generally indicates confidence in the domestic economy, it also makes Australian goods more expensive on the global market, potentially impacting trade-sensitive sectors.
In the commodities space, aside from the dip in crude oil, iron ore prices were flat in early Asian trading. Any sustained weakness in key exports like iron ore and coal could add further downside pressure to the local bourse.
Market Commentary: Risk-Off Mode Prevails
“Today’s session reflects a classic risk-off environment,” said James Taylor, Market Analyst at CMC Markets Australia. “Investors are not only reacting to the U.S. data, but also repositioning portfolios that had previously favored high-growth plays. Until we get more clarity from the Fed or see signs of inflation cooling, volatility is likely to persist.”
Taylor added that traders should watch for movements in U.S. futures, bond yields, and commodity prices to determine whether the current trend continues or finds a floor during the session.
Outlook: Uncertainty Lingers
Looking ahead, the ASX 200’s performance for the rest of the day will depend largely on sentiment from the U.S. futures market and any updates on global macroeconomic data. With investor nerves heightened, the market may struggle to stage a meaningful rebound unless a positive catalyst emerges.
As global volatility continues to shape early April trading, Australian investors remain cautious, monitoring every data point and market signal closely.
