Good morning. A global selloff in technology and semiconductor stocks drove markets overnight. The S&P 500 fell 1.4% to 7,365 and the Nasdaq dropped 2.2% to 25,587, with chip names leading the declines. Interest-rate fears were behind the move. After new Federal Reserve chair Kevin Warsh stressed the bank's commitment to 2% inflation at last week's meeting, Bank of America told clients to expect three rate rises this year rather than holds, calling the Fed's inflation problem 'unambiguously worse'. The two-year Treasury yield rose 5 basis points to 4.24% and the 10-year added 5 basis points to 4.51%.
South Korea's Kospi fell about 10% and triggered a circuit breaker, with Samsung and SK Hynix each down around 12%, and the selling carried into US chip stocks ahead of Micron's results, due after the US close tonight. Oil fell, with Brent down 1.5% to US$76.77, after Washington issued a 60-day waiver allowing Iran to sell crude, a step that could return tens of millions of barrels to the market. Gold dropped 1.5% to US$4,117 and copper fell 3.7%.
Locally, the ASX 200 closed the prior session down 0.1% at 8,816, holding up better than offshore markets. The May inflation figures are due this morning and are the main domestic event, after the Reserve Bank held the cash rate at 4.35% on 16 June and governor Michele Bullock said inflation remained too high. The Australian dollar fell 1.1% to US69.16 cents as the US dollar firmed on the higher-rates outlook.
The regulator, which has made private credit a 2026 enforcement priority, surveyed 22 managers running 52 funds and about $76 billion, and told them not to wait for formal defaults before reassessing values.
The RBA held the cash rate at 4.35% on 16 June, with headline inflation at 4.2% year on year in April, still above the 2-3% target band.
The 10-year Australian government bond yield eased 6 basis points to 4.78%, while the RBA cash rate held at 4.35%.
It described the Fed's inflation problem as 'unambiguously worse'; the 2-year Treasury yield rose to 4.24% and the 10-year to 4.51%.
Brent settled 1.5% lower at US$76.77, and the licence could release a floating inventory of about 67 million barrels, worth an estimated US$8 billion to US$9 billion to Tehran.
The move came as investors rotated out of resources and back into a sector that had lagged, and after non-executive director Carolyn Hewson bought 1,036 shares on-market for about $99,342.
The transaction is expected to settle in late June and adds to Goodman's industrial and data-centre property holdings.
The plant processed about 6.5 million barrels through the two months of disrupted operations, and the alkylation unit that turns LPG into petrol will stay offline into 2027.
If run on green ammonia, the fleet could cut about 250,000 tonnes of carbon dioxide a year against conventional marine fuels.
The company has guided to about US$33.5 billion in revenue and gross margins near 81%, and its shares fell roughly 11% in the selloff ahead of the result.
South Korea's Samsung and SK Hynix each fell around 12% and the Kospi dropped about 10%, triggering a circuit breaker, while Intel and Nvidia led declines on Wall Street.
SpaceX, which has begun a debt raising of its own, fell about 16% to its lowest level since its listing.
Goldman Sachs lifted its forecast to about 420,000 vehicles, citing European demand up an estimated 85% to 90% year on year, which offsets softer US sales.
“We have the capability and commitment to deliver on our price stability objective of 2%. The commitment to deliver is strong, unanimous, and unambiguous.”
“Inflation is still too high. If we need to increase rates again, we will.”
“Participants should use this reporting cycle to challenge assumptions, refresh valuations and lift practices. They should not wait for formal defaults before reassessing asset values and related risks.”
“I am especially encouraged by our progress and pipelines in the key health care, automotive, aerospace, and data center verticals.”
“We achieved these results despite operating through a period of extreme geopolitical volatility, consumer sentiment at historically low levels, and unusually high fuel prices.”
“We are initiating an outlook for calendar year 2026 that implies 20% adjusted EPS growth in the transition year. I have never been more confident on our path ahead.”
For wholesale clients only. Prepared by Arc Point OCIO Pty Ltd (ACN 693 569 765), Corporate Authorised Representative (CAR 1319046) of Capella Advisory (AFSL 550125), for wholesale clients within the meaning of the Corporations Act 2001 (Cth); it is not intended for, and should not be relied on by, retail clients. This note is factual market reporting and general information, with any arcpoint view clearly labelled as such. It is not personal advice and does not take into account any person's objectives, financial situation or needs. Information is drawn from sources believed to be reliable but its accuracy and completeness are not guaranteed. Past performance is not a reliable indicator of future performance.
Sources: Yahoo Finance, FRED, RBA, company filings.