US sharemarkets finished lower overnight as rising oil prices and renewed tensions in the Middle East weighed on investor sentiment, while traders looked ahead to key US inflation data and the start of the earnings season.
The S&P 500 fell 0.79% to 7,515.34, while the Nasdaq Composite dropped 1.55% to 25,873.18. The Dow Jones Industrial Average lost 138.37 points, or 0.26%, to 52,498.64.
Markets weakened after US President Donald Trump announced the reinstatement of a blockade on Iranian shipping through the Strait of Hormuz, prompting a sharp rise in oil prices. Brent crude climbed 9.6% to above US$83 a barrel, while West Texas Intermediate surged 9.4% to more than US$78.
Technology stocks were among the biggest losers. Semiconductor shares remained under pressure, with Micron Technology falling 4%, Intel losing 6%, Advanced Micro Devices shedding 4% and Sandisk dropping 12%. South Korean chipmaker SK Hynix also retreated after its recent Nasdaq debut.
Investors also turned their attention to the upcoming US earnings season, with major banks including JPMorgan Chase, Goldman Sachs and Bank of America due to report this week. June inflation figures are also due overnight, with markets watching for clues on the Federal Reserve’s next interest rate move.
Australian Market Outlook
Australian shares are expected to open slightly lower after the jump in oil prices offset weakness across Wall Street.
S&P/ASX 200 futures are down 8 points, or 0.1%, to 8,775.
Locally, investors will focus on the Westpac Consumer Sentiment survey at 10:30am AEST and the NAB Business Confidence survey at 11:30am. Overseas, attention will turn to China’s trade data, while US June CPI and Federal Reserve Chair Kevin Warsh’s testimony before Congress are expected to provide fresh guidance on the outlook for interest rates.
