Investing.com - The Australian stock market fell 1.2% after the first hour of Monday's trade. At the same time, oil prices are expected to rally due to potential disruptions following airstrikes in Iraq, Syria, and Yemen by the United States and Britain. These attacks were directed at Iran-related targets as a response to a fatal assault on American soldiers.
Before the airstrikes, futures were down by 0.7% or 54 points. The S&P/ASX 200 Index had a strong performance last week, gaining nearly 2% and reaching a record intraday peak on Friday. This was largely driven by speculation that the Reserve Bank may reduce interest rates at least twice this year, starting in August.
The RBA is anticipated to maintain the cash rate at 4.35% on Tuesday, given that the official inflation data has slowed more than expected. Investors will be keenly eyeing the statement's tone regarding the rate outlook. On Friday, Governor Michele Bullock will address the House of Representatives Standing Committee on Economics.
This week also marks the beginning of corporate earnings season, with companies like Amcor PLC (ASX:AMC), AGL Energy Ltd (ASX:AGL), Cettire Ltd (ASX:CTT), and Mirvac Group (ASX:MGR) set to report their results.
In the commodities market, oil prices fell by 2% on Friday following a strong US jobs data report, which decreased the likelihood of immediate rate cuts. Brent crude for April delivery dropped 1.7% to $US77.33 a barrel, and West Texas Intermediate declined 2% to $US72.28. Both contracts concluded trading before the news of the weekend's airstrikes.
On Wall Street, the NASDAQ Composite and S&P 500 experienced significant gains of 1.7% and 1.1% respectively, following a US jobs report that dashed hopes of an imminent cut in interest rates while showcasing a robust economy.
Investors will also be monitoring as Argo Investments Ltd (ASX:ARG) releases of its half-year earnings.