Staff reporter
Updated ,first published
Energy shares gained ground on the Australian sharemarket after oil prices jumped again following a dramatic day on Wall Street where investors wiped $US357 billion ($506 billion) off Microsoft’s market capitalisation.
The S&P/ASX 200 was up 22.1 points, or 0.3 per cent, to 894961 in early trade, with seven of 11 industry sectors in the green. Technology shares are the heaviest weight on the index.
Energy stocks jumped as oil prices rose on worries tension between the United States and Iran could constrict the flow of crude. Defence Secretary Pete Hegseth warned the US military “will be prepared to deliver whatever the president expects,” just a day after President Donald Trump told Iran to “make a deal” on its nuclear program. Woodside Energy advanced 1 per cent and Santos gained 3.1 per cent in early afternoon trade.
Shares in embattled gaming company The Star erased early gains to slump 11 per cent lower in early afternoon trade. In a quarterly update, the company posted $301 million revenue in the December quarter, a 6 per cent rise over the prior quarter, but warned of “numerous material” uncertainties.
Local tech shares suffered losses echoing a difficult night on Wall Street for tech giants following Microsoft’s 10 per cent tumble. WiseTech fell 1.6 per cent, Xero lost 1.4 per cent and Technology One retreated 2.2 per cent.
Gold stocks retreated after the price of the safe haven metal fell sharply overnight.
Gold, near $US5600 an ounce, suddenly and briefly dropped below $US5200 before advancing again to fetch around $US5427 at 10.36am AEDT. In early trade, Northern Star added 0.7 per cent, Evolution Mining fell 0.8 per cent and Newmont slipped 2.9 per cent. Among the iron ore heavyweights, BHP advanced 0.8 per cent, Rio Tinto added 0.6 per cent and Fortescue lost 1 per cent.
Bank stocks are mixed. Westpac climbed 0.8 per cent in early afternoon trade, ANZ Bank added 0.5 per cent, National Australia Bank edged up 0.2 per cent while Commonwealth Bank dipped 0.1 per cent.
Nine Entertainment, owner of this masthead, added 4.1 per cent after it struck a deal to sell Australia’s top-rating conservative talkback stations 2GB, 3AW, 4BC and 6PR to publican and pokies billionaire Arthur Laundy and his family for $56 million. Nine has also purchased outdoor media firm QMS for $850 million.
The Australian dollar was trading at US70.14¢ at 12.24pm AEDT.
Overnight, the S&P 500 slipped 0.1 per cent after flirting with its record high in the morning and dropping by as much as 1.5 per cent later in the day. The Dow Jones rose 55 points, or 0.1 per cent, after erasing an earlier loss of more than 400 points, and the Nasdaq composite fell 0.7 per cent.
Microsoft was the heaviest weight on Wall Street by far. The tech giant plunged amid scepticism over how much the company is investing in artificial intelligence, despite reporting stronger profit and revenue for the latest quarter than analysts expected.
It was the stock’s worst day since the market’s COVID-19 crash in 2020.
Apple’s iPhone sales soared to a new quarterly record during the holiday season, despite artificial intelligence blunders that prompted the technology trendsetter to get a helping hand from Google. Shares are up 1 per cent in after-hours trading.
Tesla weighed on the market after falling 3.5 per cent. It delivered a bigger profit for the latest quarter than analysts expected, but the results were sharply lower than from a year earlier. Tesla’s leader, Elon Musk, has been trying to get investors to focus less on its flagging car sales and more on the company’s robotaxis and robots.
Companies across the market are under pressure to deliver at least solid growth in profits following record-setting runs for their stock prices. Stock prices tend to follow the path of corporate profits over the long term, and earnings need to rise to quiet criticism that stocks have grown too expensive.
Still, more stocks rose within the S&P 500 than fell. Leading them was Meta Platforms, which rallied 10.4 per cent after the company behind Facebook, Instagram and WhatsApp topped profit expectations, even though it also said it will continue its massive investments in AI. IBM was another winner and climbed 5.1 per cent after surpassing analysts’ expectations for profit and revenue.
Some of the wildest action in financial markets was again for precious metals. Silver, which has been zooming higher in its own feverish run, had a similar and sudden reversal of momentum before ticking higher again.
Bitcoin, which is pitched as a form of “digital gold”, also fell sharply. It sank nearly 6 per cent and dropped toward $US84,000.
On the bond market, the yield on the 10-year Treasury dipped to 4.23 per cent from 4.26 per cent late on Wednesday.
With AP
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