Good morning, and welcome to the ABC’s finance blog. I’ll be guiding you through the latest market action for the next few hours.
The local share market is expected to start its day slightly higher (with ASX futures up 0.1%), while the Australian dollar is marginally lower at 70.2 US cents.
That’s despite US forces launching missile strikes against Iran “in response to yesterday’s downing of a US Army Apache helicopter“, according to US Central Command.
The US retaliation was a “proportional response to unjustified Iranian aggression”, Centcom said in an X post, shortly after 7am AEST.
But earlier in the week, US President Donald Trump said both countries were in the final stages of a “very, very good deal” that will stop Iran from getting nuclear weapons and fully reopen the Strait “immediately upon signing”.
Mr Trump also said the deal could be signed “in two or three days” — claims that he has been repeating throughout the past three months of the war.
Market reaction
Despite the renewed hostilities between the two warring nations, there was a steep fall in the price of oil — which is normally a sign that traders are expecting the war to end soon.
Brent crude futures had fallen 2.1% to $US92.25 a barrel by 8am AEST.
The US strikes against Iran happened after Wall Street has finished trading (with mixed results).
While the Dow Jones rose slightly by 0.2%, the S&P 500 slipped by 0.3% while the tech-heavy Nasdaq Composite dropped 1%.
Essentially, investors took profits by ‘selling down’ their high-flying tech and AI stocks and ‘rotating’ their money into more defensive sectors like real estate, utilities .and healthcare — which haven’t risen anywhere near as much in the past few months.
Spot gold, meanwhile, has dropped 1.5% to $US4,263 an ounce.
In the meantime, go grab a coffee, tea or brekky! I’ll have more updates for you shortly.
