Markets Overview

  • ASX SPI 200 futures down 0.5% to 8,698.00
  • S&P 500 little changed at 7,520.36
  • Dow Average up 0.4% to 50,644.28
  • Aussie down 0.4% to 0.7141 per US$
  • US 10-year yield little changed at 4.4827%
  • Australia 3-year bond yield fell 5.4 bps to 4.50%
  • Australia 10-year bond yield fell 5.4 bps to 4.86%
  • Gold spot down 1.1% to $4,456.09
  • Brent futures down 4.7% to $94.92/bbl

Economic Events

  • 10:30: (AU) Australia to Sell A$1 Billion 84-Day Bills on May 28
  • 10:30: (AU) Australia to Sell A$1 Billion 133-Day Bills on May 28
  • 11:30: (AU) 1Q Private Capital Expenditure, est. 1.0%, prior 0.4%
  • 11:30: (AU) SURVEY: Private Capital Expenditure 2026-27 A$165.5b
  • 11:30: (AU) April Household Spending MoM, est. -0.5%, prior 1.6%
  • 11:30: (AU) April Household Spending YoY, est. 5.8%, prior 6.3%

Asian equities fell from record highs after conflicting signals from the US and Iran on prospects for a deal to end the war. Crude oil gained.

Stocks in Australia, South Korea and Japan edged down, pushing the MSCI Asia Pacific Index 0.6% lower. US stock futures erased earlier gains to slip 0.1% after Reuters reported new strikes by the US in Iran. Brent, the global crude oil benchmark, advanced 2% to $96.15 a barrel. The dollar gained.

Treasuries fell slightly in Asian trading after bonds erased their gains during the US session following the White House’s dismissal of an Iranian media report that indicated peace negotiations were progressing toward ending a war that’s pushing up inflation. Bonds in Australia and New Zealand also edged lower.

The technology sector remained in focus after some mixed earnings. Salesforce Inc. gave a lukewarm outlook and HP Inc. gave a profit outlook that failed to ease the chip-cost concern. Snowflake Inc. shares jumped almost 30% in late trading after the software maker gave a stronger-than-expected annual outlook. Marvell Technology Inc. delivered a quarterly forecast that exceeded analysts’ estimates.

While resilient demand for AI-linked shares has repeatedly pushed global equities to records, elevated energy prices and the risk of renewed inflation have kept bond investors cautious. Attention now turns to Thursday’s release of the April personal consumption expenditures index — the Fed’s preferred inflation gauge — for clues on the path of interest rates.

“The stock market has enough confidence that a resolution with Iran will eventually come to light, even if it’s not immediate,” said Alexander Guiliano at Resonate Wealth Partners. “While it may seem like stocks have moved too fast, we saw a garden variety correction only two months ago, which helped to reset sentiment.”

President Donald Trump said he was “not satisfied” in negotiations with Iran, damping expectations for an imminent breakthrough. The US denied an Iranian media report about a draft interim deal that said traffic through the Strait of Hormuz could return to normal within a month of it coming into effect.

Trump asserted that no one nation would control the waterway, highlighting a key sticking point in resolving the conflict as it enters its fourth month. He didn’t indicate what steps the US would take to ensure free passage of vessels. The president also downplayed the possibility of Iranian sanctions relief.

US Secretary of State Marco Rubio said that “we’ll see over the next few hours and days whether progress could be made” on Iran. US Special Envoy Steve Witkoff, Jared Kushner and Vice President JD Vance “have been very involved,” he noted.

US stocks ended Wednesday’s session roughly where they started, as investors took profits in tech names but remained optimistic that an end to the war in the Middle East was near.

Despite the day’s see-saw trading, Wall Street strategists remain largely bullish on stocks, with the S&P 500 hovering near all-time highs.

An “exceptionally strong first-quarter reporting season” prompted Goldman Sachs Group Inc. strategists led by Ben Snider to raise the year-end target for the S&P 500 to 8,000 points from a previous forecast of 7,600. Goldman joins Morgan Stanley and Deutsche Bank AG in seeing the benchmark end the year at 8,000 points.

The failure to strike a deal to end the conflict is threatening to prolong the disruption to oil supplies, which has caused a steep jump in bond yields since late February by rekindling inflation. Central banks including the Federal Reserve are expected to raise interest rates in response.

Investors and traders are “looking for something concrete on US and Iran that signals the conflict is coming to an end,” pointing to “a rally in Treasuries along with the decline in oil prices,” said Jack McIntyre, portfolio manager at Brandywine Global Investment Management.