US sharemarkets finished mixed on Wednesday as investors continued rotating away from parts of the technology sector, while falling oil prices and bond yields helped limit broader market losses.
The Nasdaq Composite fell 0.43% to 25,476.64, while the S&P 500 eased 0.10% to 7,358.22. The Dow Jones Industrial Average added 182.06 points, or 0.35%, to close at 51,848.90.
Technology stocks remained under pressure following Tuesday’s semiconductor sell-off. Micron Technology slipped 0.3% ahead of its quarterly earnings report, while Sandisk fell 2.5%. The VanEck Semiconductor ETF finished marginally lower after tumbling 7% in the previous session.
Alphabet also closed slightly lower after surrendering earlier gains despite news it will replace Verizon in the Dow Jones Industrial Average.
Oil and Macro
Oil prices extended their recent decline as investors grew more confident that improving conditions in the Middle East could support a more stable inflation outlook.
Brent crude fell 4.33% to settle at US$73.74 a barrel, while West Texas Intermediate crude dropped 3.92% to US$70.34 a barrel. Both benchmarks reached their lowest levels since early March.
The decline in energy prices helped push US Treasury yields lower, with the 10-year yield falling below 4.5%.
Energy stocks weakened in response, with Exxon Mobil, Chevron, ConocoPhillips and SLB all falling more than 2%.
Attention now turns to US economic data, with May PCE inflation figures and the third estimate of first-quarter GDP due later today.
Australian Market Outlook
Australian shares are expected to open modestly higher following a late improvement in sentiment on Wall Street and strong after-hours results from Micron Technology.
S&P/ASX 200 futures are up 16 points, or 0.2%, to 8,810.
Investor focus today will centre on Australia’s May labour force report, due at 11.30am AEST. Economists expect more than 40,000 jobs were added during the month, with the unemployment rate forecast to edge down to 4.4%.
Further domestic economic indicators are due today, including job vacancies and household spending data, which may help shape expectations for interest rates.
