It looks as though the Australian sharemarket will dip when trade begins, with ASX futures pointing down -0.7% to 8,290 points this morning.
Wall Street had some similar hiccups overnight as investors evaluated key economic indicators in anticipation of next week’s Federal Reserve meeting.
The Dow Jones fell 234 points, or 0.5%, the S&P 500 followed suit with a 0.5% dip and the Nasdaq shed 132 points, or 0.7%.
Tech leads the downturn
Technology stocks were a drag on the markets, with Nvidia falling 1.4%, and slumps for fellow giants including Alphabet (NASDAQ:GOOGL), Amazon (NASDAQ:AMZN), Meta Platforms and Tesla (NASDAQ:TSLA) ranging between 0.3% and 1.8%.
Adobe (NASDAQ:ADBE) plummeted 13.7% after its fiscal 2025 revenue outlook fell short of market expectations. Conversely, Warner Bros Discovery surged 15.4% on plans to restructure its cable TV segment.
In Europe, markets closed mostly lower as the European Central Bank (ECB) cut its deposit rate by 25 basis points to 3%, citing economic headwinds from political instability and potential US trade disputes.
The Swiss National Bank slashed its interest rate by 50 basis points to 0.5%, while Denmark’s central bank reduced its key policy rate by 25 basis points to 2.6%.
The FTSEurofirst 300 index fell 0.2%, though UK’s FTSE 100 edged up 0.1%.
US producer price data exceeded expectations, with the index rising 0.4% in November (survey: 0.2%), pushing annual growth to 3%. Initial jobless claims increased by 17,000 to 242,000 last week.
Treasury yields climbed, with the US 10-year yield up 6 points to 4.33%.
Court slaps penalty on Kraken Australia
The Federal Court has fined crypto company Kraken’s Australian operation $8 million for violating the Corporations Act by offering an unlicensed credit facility to over 1,100 customers.
Australia's crypto industry faces growing calls for regulatory clarity, with only 40 of 400 crypto-related businesses currently licensed and the Australian Securities and Investments Commission (ASIC) pursuing enforcement actions in the absence of comprehensive regulation.
Industry leaders have criticised the "stagnant" regulatory environment, urging legislative action to replace ASIC’s "regulation by enforcement" approach.
Fred Schebesta, founder of Finder, argues that enforcement-driven regulation stifles innovation, likening it to "suing the Wright brothers for not having a pilot's licence”.
But despite legal and regulatory challenges, enthusiasm for cryptocurrency remains strong.
Bitcoin has surged to record highs, nearing US$100,000, buoyed by optimism following Donald Trump’s re-election and his pledge to make the US a "crypto capital”.
At the recent Aus Crypto Convention in Sydney, thousands of attendees celebrated the sector’s potential, with organiser David Haslop comparing the crypto boom to the dot-com era, enthusing: "This is the future of finance, and we're right in the thick of it.”
Currencies and commodities
The US dollar strengthened against major currencies, with the euro slipping to US$1.0470 and the Australian dollar dipping to 63.65 US cents.
Commodities faced mixed fortunes. Brent crude fell 0.1% to US$73.41 per barrel, while gold slid 1.7% to US$2,709.40 an ounce.
Copper dropped 0.5%, reflecting dollar strength and Chinese stimulus uncertainty.
Looking ahead, Reserve Bank of Australia official Sarah Hunter is set to deliver a key address today.
Market snapshot
- ASX 200 futures: +0.1% to 8,290
- Australian dollar: Flat at 63.66 US cents
- S&P 500: -0.5% to 6,051 points
- Nasdaq: -0.7% to 19,902 points
- FTSE: +0.1% to 8,311 points
- EuroStoxx: -0.1% to 519 points
- Spot gold: -1.4% to $US2,682/ounce
- Brent crude: Flat at $US73.49/barrel
- Iron ore: +1.1% to $US105.70 a tonne
- Bitcoin: -1.6% to $US100,016
Source: ABC