The Australian sharemarket opened lower on Wednesday, following its worst performance in four years after technology stocks powered a strong session on Wall Street overnight.
By 10:30 am AEST (12:30 am GMT), the ASX 200 index had declined 0.5% to 8,733.0 points.
The lower start follows another record-setting session in the United States where the Dow Jones Industrial Average hit a record close as investors focussed more on economic fundamentals than geopolitical worries.
The Dow rose 0.3% on Tuesday (Wednesday AEST) but was surpassed by the S&P 500, which added 0.8%, and the Nasdaq Composite, which jumped 1.5%, as the market looked to the next round of quarterly profit reports with optimism about artificial intelligence (AI).
"The market is looking forward and preparing for earnings season, which is not that far away," Spartan Capital Securities chief market economist Peter Cardillo was quoted as saying in a Reuters story.
CommSec Equity Market Strategist James Gruber said Australian technology stocks should be well supported today given the strong performance of stocks on the Nasdaq overnight.
“The positive is that normally you get a bit of buying at the start of the financial year because tax loss selling of stocks before the financial year ended is over and it's a fresh start in terms of buyers and sellers and demand,” he said.
Australian shares had ended lower on the final day of the 2026 financial year with the ASX 200 losing 0.5% to 8,778.7 points.
This left the benchmark with a 2.8% gain over the year to 30 June, significantly trailing the main U.S. benchmarks, which increased by 19% (Dow Jones), 24% (S&P 500), and 36% (Nasdaq), respectively.
Although analysts are expecting an improved performance in Australia in the current year to a 3-6% lift in prices over 12 months, the ASX is still expected to be outperformed by U.S. stocks, which are tipped to rise by several percentage points more.
Stocks to watch today include South32 (ASX: S32), which has agreed to sell its bauxite, alumina and aluminium assets to Alcoa for US$4.1 billion (A$5.9 billion).
In bond markets, the Australian Government bond yield curve steepened as two-year interest rates fell 0.20% to 4.432% while 10-year rates were flat at 4.769% at the time of writing.
