US sharemarkets finished lower on Thursday as investors assessed a fresh round of corporate earnings and developments in the Iran war, including efforts to reach an agreement to reopen the Strait of Hormuz. The S&P 500 fell 0.18% to 7,709.96, while the Nasdaq Composite eased 0.06% to 26,348.35. The Dow Jones Industrial Average dropped 464.02 points, or 0.85%, to 53,885.
Corporate results drove much of the session. Salesforce fell 3% after announcing changes to its senior leadership team, weighing on the Dow. Memory and technology stocks also came under pressure, with Sandisk dropping more than 6% after its fiscal fourth-quarter results failed to impress investors.
Western Digital fell 13% after issuing a weaker-than-expected first-quarter outlook, despite fourth-quarter results beating expectations. AppLovin tumbled almost 20% following mixed quarterly results.
The declines came after a strong period for several technology names, prompting some investors to lock in gains. Cboe’s JJ Kinahan said markets appeared to be taking a breather following an earnings-driven stretch of trading, noting that stronger-than-expected profits and revenue do not necessarily support share prices when accompanied by softer guidance.
The broader earnings season remains a key driver for equities, with investors increasingly focused on company outlooks and whether earnings growth can support valuations following the recent market rally.
Oil prices moved higher as investors monitored developments in the Iran war and negotiations around reopening the Strait of Hormuz. The move supported energy stocks but renewed concerns that higher crude prices could add to inflationary pressures and keep interest rates elevated. The outlook for US Treasury yields and monetary policy also remains in focus. XS.com analyst Antonio Di Giacomo said the direction of the US labour market, bond yields, geopolitical developments and the AI investment cycle would be important in determining the next move for US equities.
Australian Market Outlook
Australian shares are expected to open slightly lower following modest declines on Wall Street and renewed uncertainty around energy prices. S&P/ASX 200 futures are down 4 points, or 0.04%, to 9,190. The softer lead comes as eight of the S&P 500’s 11 sectors finished lower overnight, led by industrials, while energy stocks gained alongside higher oil prices. The relatively flat futures signal suggests the local market could remain sensitive to further developments in the Iran war and movements in commodities. Investors will also continue to assess the outlook for inflation and interest rates, with higher energy costs potentially complicating the path for central banks as the August reporting season gathers pace.
