Markets Overview

  • ASX SPI 200 futures up 0.1% to 8,913.00
  • S&P 500 down 1% to 6,823.13
  • Dow Average down 0.3% to 47,504.06
  • Aussie down 0.4% to 0.6549 per US$
  • US 10-year yield rose 1.3bps to 4.0892%
  • Australia 3-year bond yield rose 4.3 bps to 3.61%
  • Australia 10-year bond yield rose 8.3 bps to 4.31%
  • Gold spot up 2.3% to $4,021.83
  • Brent futures down 0.4% to $64.66/bbl

Economic Events

  • 11:00: (AU) Australia to Sell A$800 Million 3.25% 2029 Bonds
  • 11:30: (AU) Sept. Private Sector Credit MoM, est. 0.6%, prior 0.6%
  • 11:30: (AU) Sept. Private Sector Credit YoY, prior 7.2%
  • 11:30: (AU) 3Q PPI YoY, prior 3.4%
  • 11:30: (AU) 3Q PPI QoQ, prior 0.7%

Australian banking shares could face a reckoning as lenders unveil earnings starting next week, with valuations setting a high bar for results. RBNZ policy committee member Prasanna Gai to speaks at the Melbourne Annual Macro Policy Meeting.

Wall Street pumped the brakes on a stock rally as concerns over whether massive artificial-intelligence spending will pay off sent Meta Platforms Inc. down 11%. Bond yields and the dollar rose as the Federal Reserve tempered rate-cut expectations.

A selloff in several megacaps dragged down the S&P 500, following a $17 trillion surge from its April lows. While the US and China agreed on a trade truce, the deal was seen as mostly priced in. Meantime, equities triggered a “Hindenburg Omen” – a technical indicator that occurs when a bifurcated market loses momentum amid lackluster breadth.

Those developments gave some reasons for stocks to take a breather amid warnings about valuations and a narrowing of participation that had spurred a significant outperformance of megacaps.

The AI trade is so essential to the bull market that any updates on spending and progress developing the technology could quickly sway traders one way or the other.

“None of this means that the AI bubble is going to burst and that we’re on the cusp of a major reversal in the stock market,” said Matt Maley at Miller Tabak. “However, it does raise the odds that we could see a short-term pullback.”

Meta sold $30 billion of bonds amid record orders. Microsoft Corp. slid on underwhelming results. Alphabet Inc. climbed on a revenue beat. Nvidia Corp. dropped as Donald Trump said he didn’t discuss approving sales of Blackwell chips to China with Xi Jinping.

In late hours, Apple Inc. reported strong overall sales, though revenue in China fell short of estimates. Amazon.com Inc.’s cloud unit posted a solid growth rate. Netflix Inc. approved a 10-for-1 stock split.

The S&P 500 fell 1%. The yield on 10-year Treasuries rose one basis point to 4.09%. The dollar hit a three-month high. Bitcoin sank.