Australian shares are set to open lower on Friday, tracking sharp losses on Wall Street after renewed hostilities between the United States and Iran pushed oil prices above US$100 a barrel, reigniting concerns about inflation and higher interest rates.
ASX 200 futures were down 50 points, or 0.6%, to 8,750, signalling a weaker start for the local market.
Overnight, all three major U.S. benchmark indexes finished lower. The Dow Jones Industrial Average fell 1%, the S&P 500 declined 1.2%, while the Nasdaq Composite tumbled 2.2% as investors reacted to earnings from major technology companies.
Tesla plunged 14.5% after reporting negative free cash flow, while Google parent Alphabet dropped 6.9% after outlining higher artificial intelligence investment plans, renewing investor concerns over the hundreds of billions of dollars being committed to AI infrastructure.
"The numbers in aggregate are great but many companies have had a story that's caused the stock to fall," Matt Miskin, co-chief investment strategist at Manulife John Hancock Investments, told Reuters.
"Any chink in the armour and the stocks are being sold off," he said, pointing to investor concerns over rising capital expenditure.
In after-hours trading, Intel briefly surged more than 12% after issuing a revenue forecast that comfortably exceeded analysts' expectations, driven by continued strength in demand for its data centre business.
Locally, the Australian sharemarket ended Thursday's session modestly higher after stronger-than-expected employment data reinforced expectations that the Reserve Bank of Australia could raise interest rates again. Gains in the materials and energy sectors offset weakness in technology stocks.
On the bond markets, the 10-year Australian government bond yield climbed 0.04% to 5.069%, while the two-year yield dipped 0.3% to 4.697%.
