The Australian sharemarket has opened lower, dragged down by miners and banks, following weak leads from Wall Street overnight as investors await Nvidia’s quarterly results.
The Australian sharemarket has opened lower, dragged down by miners and banks, following weak leads from Wall Street overnight as investors await Nvidia’s quarterly results.
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By Cindy Yin
Updated February 25, 2025 — 10.40amfirst published at 4.23am
The Australian sharemarket opened firmly in the red on Tuesday, weighed down by miners and banks, following weak leads from Wall Street overnight as investors await Nvidia’s quarterly results on Wednesday.
The S&P/ASX200 dropped 76.2 points, or 0.9 per cent, to 8,230 points as at 11.20 am AEDT, with 10 of the 11 industry sectors retreating. The Australian dollar traded at 63.4 US cents.
The slump in mining shares continued, down 0.9 per cent for the sector. BHP, the sharemarket’s second-biggest company, was down 1 per cent in early trade, while Fortescue (down 2.2 per cent) and Rio Tinto (down 0.7 per cent) similarly slipped due to weak iron ore prices.
All big four banks traded in the red at open, with CBA (down 1.3 per cent), NAB (down 1.6 per cent), and ANZ (down 1 per cent) all falling, while Westpac treaded water (down 0.1 per cent). It follows a pullback in bank shares following the release of earnings results last week that triggered a share price wobble across the sector.
Other sectors of the sharemarket similarly see-sawed as traders digested a slew of half-year results across the local bourse. Consumer discretionary was the worst-performing sector, dropping 2.5 per cent, dragged down by retail conglomerate Wesfarmers slipping 1.9 per cent. Domino’s Pizza stock also plunged 10.9 per cent after it posted a loss of $22.2 million for the first half of the financial year. It also comes after it announced heavy restructuring costs associated with the closure of 205 underperforming stores, mostly in Japan.
Energy giant Woodside was up 1.8 per cent in early trade, after reporting its statutory ney profit for the year rose 115 per cent. However, lower oil and gas prices pushed its underlying net profit for the 12 months to December 31 down 13 per cent.
Nine Entertainment shares were up 5.2 per cent, despite reporting its net profit after tax fell 25 per cent to $112.2 million, weighed down by weaker advertising conditions and a loss of revenue from Meta.
WiseTech shares were down 2.8 per cent, leading tech stocks lower, after tumbling 20.1 per cent in the previous trading session. It comes after the embattled software giant announced on Monday that four independent board members were leaving after failing to agree with disgraced company founder Richard White about his role.
In the US, stocks drifted lower on Monday to compound their sharp losses from last week.
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The S&P 500 dipped 0.5 per cent after flipping between small gains and losses several times through the day. The relatively modest moves followed its 1.7 per cent tumble on Friday, which came after several weaker-than-expected reports on the US economy.
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The Dow Jones added 33 points, or 0.1 per cent, while the Nasdaq composite fell 1.2 per cent.
Big US companies have broadly been reporting better profits for the last three months of 2024 than analysts expected, which is one of the main reasons the S&P 500 set a record before sliding at the end of last week. The pace of reports will slow this week, but several potentially market-moving updates are still on deck.
Chief among them is Nvidia, the company that’s become one of Wall Street’s most influential stocks because of what had been nearly insatiable demand for its chips. Wednesday will be the company’s first profit report since a Chinese upstart, DeepSeek, upended the artificial intelligence industry by saying it developed a large language model that can compete with big US rivals without using the top-flight, most expensive chips.
That called into question all the spending Wall Street had assumed would go into not only Nvidia’s chips but also the ecosystem that’s built around the AI boom, including electricity to power large data centres.
Nvidia’s stock bounced between gains and losses through Monday, helping pull the S&P 500 and other indexes up and down in its wake. It ended up falling 3.1 per cent and was the heaviest single weight on the S&P 500. Because of its massive size, Nvidia is the second-most influential stock on the S&P 500 after only Apple, and it alone accounted for more than a fifth of the index’s total return last year.
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Apple shares rose by 0.6 per cent as it sought relief from US President Donald Trump’s tariffs on goods imported from China, saying it will hire 20,000 new workers and produce AI servers in the US.
All told, the S&P 500 fell 29.88 points to 5,983.25. The Dow Jones Industrial Average added 33.19 to 43,461.21, and the Nasdaq composite fell 237.08 to 19,286.92.
Recent reports have shown that consumer sentiment is souring as inflation expectations worsen, in part because of tariffs and other policies pushed by President Donald Trump.
Stubbornly high inflation could prevent the Federal Reserve from delivering more relief for the economy and financial markets through lower interest rates.
The Fed has been holding its main interest rate steady after sharply cutting it through the end of last year. At their last policy meeting in January, Fed officials suggested they may stay on hold for a while given worries about how Trump’s proposed tariffs and mass deportations of migrants, along with other factors, could push upward on inflation.
While lower rates can boost the economy, they can also encourage spending that puts upward pressure on inflation.
With AP
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