By business reporter
The Australian share market is poised for a significant decline following recent military actions by the United States against Iran, which have caused oil prices to rise to a two-month peak. As of Tuesday’s close, the ASX 200 index dropped by 0.9%, ending at 8,934 points, while the broader market indicators reflect a negative trend with the ASX 200 falling by 0.1% to 9,067 points and the Australian dollar decreasing by 0.3% to 71.5 US cents.
Overnight, US indices experienced substantial losses, with the Dow Jones down by 0.8%, the S&P 500 dropping 0.7%, and the Nasdaq Composite falling by 1%. European markets followed suit, as evidenced by the FTSE’s decline of 0.3%, the DAX’s 1.1% drop, and a 0.6% decrease in the Stoxx 600 index.
The military escalation has sparked concerns, leading to a sell-off in various markets, which in turn has propelled bond yields to multi-year highs. The US dollar gained strength amid rising expectations of an interest rate hike in September, resulting in a 2.7% decrease in gold prices, which now stand at $4,329 per ounce.
Jordan’s military reported that it intercepted 10 out of 13 ballistic missiles aimed at its airspace, further heightening tensions in the region. The Iranian Revolutionary Guard Corps (IRGC) has threatened retaliation for the US strikes, indicating that serious consequences await the aggressors.
In commodity trading, Brent crude oil futures surged by 5.3%, reaching $95.26 per barrel, highlighting renewed apprehensions about inflation and geopolitical instability. The yield on US 10-year Treasury bonds rose sharply to 4.8%, marking its highest point since January 2025.
Earlier this week, an investigation by ABC revealed issues with tampered gift cards sold at major supermarkets in Australia, causing confusion among consumers and raising concerns about a potential large-scale criminal operation. Follow-up reports have since discussed the implications of this scam and how law enforcement has responded.
As we look ahead to the trading day, the Australian market is expected to open lower, reflecting the global sentiment. Investors should stay tuned for further updates as the situation evolves, and please remember that this blog is not intended as investment advice.
