Australian shares are expected to defy a technology sell-off that undermined stocks in New York overnight, opening higher on Thursday as corporate earnings remain in the spotlight.
The Australian Securities Exchange’s (ASX) main price index should open about 0.25% higher, according to ASX futures trading, as investors assess results already announced and await earnings news today.
At the time of writing, the S&P/ASX 200 September share price index (SPI) contract was trading 23 points above the previous settlement at 8,902 points, leaving it 0.5% off its recent record high.
Chief CommSec Economist Ryan Felsman said ASX prices would be supported by higher oil and gold prices overnight, but the overall direction would depend on profit releases.
“We’ve some quite large moves in share prices in relation to these earnings,” Felsman said, citing the 28% drop in James Hardie (ASX: JHX) on Wednesday following its drop in quarterly profits and weak guidance.
Felsman said the technology sell-off was likely to have less influence on the ASX given it had more in common with the industrial-focussed Dow Jones Industrial Average rather than the tech-laden Nasdaq Composite index.
Two of the three main Wall Street stock indices ended lower on Wednesday (Thursday AEST) as technology companies were sold down for a second day, as investors waited for the Jackson Hole central bankers meeting for monetary policy guidance.
The S&P 500 dropped 0.2% and the Nasdaq lost 0.7%, having rebounded from larger losses earlier, while the Dow Jones barely moved to end with a 0.04% gain.
"To me, tech was overbought," Mindset Wealth Management Managing Partner Seth Hickle was quoted in a Reuters story as saying.
The Australian sharemarket had closed marginally higher on Wednesday with the S&P/ASX 200 adding 0.3% to 8,918.0 after a mixed day of corporate reports.
The direction today will be determined by the detail in results with Goodman Group (ASX: GMG), Northern Star Resources (ASX: NST) and Brambles (ASX: BXB) among those reporting.
In fixed interest markets, yields on Australian Government bonds dropped, with two-year rates down 0.42% to 3.332% and 10-year rates off by 0.09% to 4.275%.
