Investing.com - The Australian sharemarket is expected to open markedly lower on Thursday in the wake of Wall Street pulling back from its record highs.
The NASDAQ Composite saw a substantial drop due to concerns over possible stricter US restrictions on chip sales to China, triggering a sell-off in the tech giants that have been driving the bull market.
The S&P 500 experienced a 1.4% fall, while the Nasdaq Composite fell by 2.8%, marking its most significant drop in 18 months.
The "Magnificent Seven" group, comprising giants like Amazon.com Inc (NASDAQ:AMZN), Apple Inc (NASDAQ:AAPL), NVIDIA Corporation (NASDAQ:NVDA), and Microsoft Corporation (NASDAQ:MSFT), slipped 3.4%. Wall Street's "fear gauge", the VIX, surged to its highest level since early May.
Reports of the Biden Administration considering severe trade restrictions as part of a chip clampdown against China weighed heavily on chipmakers. This sent the Philadelphia Semiconductor Index spiralling 6.8% and led to the Nasdaq's worst day since December 2022.
On the bond markets, 10-year and 2-year rates were at 4.275% and 4.117%, respectively.