The chances of the Australian share investors avoiding losses for a fourth successive day on Friday are uncertain after United States stock prices fell overnight due to a range of factors, including technology sector weakness.
Prices on the Australian Securities Exchange (ASX) are expected to open little changed based on ASX futures traders pricing the December contract of the ASX 200 index just four points below the prior settlement at 8828 points, at the time of writing.
The ASX had fallen on Tuesday, Wednesday and Thursday.
Morgans Financial private client adviser Lachlan Walsh said although the ASX had underperformed the U.S. market due to a paucity of quality technology stocks benefitting from the artificial intelligence (AI) revolution, it had some of the world’s best miners and banks.
“Our tech sector is falling while the U.S. tech sector is ripping,” he said.
“But if you haven’t been long BHP and the (Australian) banks over the last three years, there’s a good chance you have underperformed.”
He saw value in small to medium-sized Australian companies that had been decimated in the recent market sell-off, including ResMed (ASX: RMD), AP Eagers ASX: APE) and Megaport (ASX: MP1).
U.S. stocks weakened from previous record highs in a volatile session on Thursday (Friday AEST) amid a sell-off in software stocks due to renewed concerns about disruption from AI and sagging hopes of a fast end to the Middle East conflict.
U.S. corporate quarterly announcements have delivered a variety of results.
The Dow Jones Industrial Average lost 0.4%, the S&P 500 dropped 0.4%, and the Nasdaq Composite dipped 0.9%.
"We're playing musical chairs between earnings season and these war headlines that are not likely to be that great,” Infrastructure Capital Advisors CEO and CIO Jay Hatfield was quoted as saying in a Reuters story.
"We had a big run, and there are people looking to take some exposure off, and using the war as an excuse is not a bad excuse."
The Australian market had ended down on Thursday as mining stocks led the market down, with the ASX 200 Index dropping 0.6% to 8,793.4 points.
Corporate news today includes quarterly updates from PLS Group (ASX: PLS), IGO Limited (ASX: IGO) and Insignia Financial (ASX: IFL).
In fixed interest markets, the Australian Government bond yield curve continued to steepen as two-year rates dropped 0.08% to 4.716% and 10-year rates rose 0.66% to 5.01% at the time of writing.
