Rising geopolitical tensions in the Middle East, which unsettled investors in the United States overnight, could have the same effect in Australia on Wednesday, although futures trading indicated the market benchmark would open modestly higher.
The ASX 200 index was forecast to rise 0.15% at the start, based on Australian Securities Exchange (ASX) futures trading, which priced the June contract of the benchmark at 13 points above the previous settlement, at 8,624 points.
However, by 10:20 am AEST (12:20 am GMT), the ASX 200 index was trading flat at 8,604.2.
But CommSec Equity Market Strategist James Gruber said the threat of “tit for tat” strikes between the United States and Iran and the sell-off of technology stocks on Wall Street had thrown this into doubt.
Technology stocks again led the declines on Wall Street on Tuesday (Wednesday AEST) as two of the three main price markers dipped with traders unnerved by the latest threat of renewed fighting.
U.S. President Donald Trump wrote in a social media post that his country “must, of necessity, respond" after Iran shot down an American helicopter near the coast of Oman.
“I think the ASX may be pushing it uphill today,” said Gruber.
Although the Dow Jones Industrial Average put on 0.2%, the S&P 500 dropped 0.3%, and the technology-heavy Nasdaq Composite lost 1%.
"When the bounce ran its course this morning, the tape came for sale more broadly," JonesTrading chief market strategist Michael O'Rourke was quoted in a Reuters report.
"There's also a rotation going on ... so part of it is more of a momentum unwind."
He said Trump's post also briefly "created another leg down”.
The ASX 200 had ended 0.2% lower at 8,604.2 points on Tuesday despite seven of the 11 sectors closing higher amid lower mining and gold stocks.
Stocks to watch today include Chemist Warehouse parent Sigma Healthcare (ASX: SIG) amid media reports it is considering bidding for British pharmacy and beauty group Boots.
Boots is in talks with Sigma and the Weston family over a $10 billion (£7.5 billion) sale that would see the British retailer scrap plans for a London initial public offer, according to this Reuters story citing a Financial Times article.
In fixed interest markets, Australian Government bond yields fell, with two-year rates down by 0.53% to 4.543% and 10-year rates off by 0.08% to 4.890% at the time of writing.
