ASX Market Outlook: Pre-Open Brief 04.04.2025
ASX Stock Market Outlook
The ASX 200 is poised for a brutal session, with SPI futures down 1.18%. This comes after two weeks of modest gains were wiped off the board in one fell swoop. A devastating session on Wall Street, escalating geopolitical tensions, and the reality check that sticky inflation is not going anywhere. The result is classic risk-off chaos, with every market corner flashing red.
The macro environment is full of pessimism.
Trump’s ‘Liberation Day’ tariffs have kicked in, rattling trade-sensitive sectors and reigniting fears of a full-scale decoupling between the US and China. Combine that with hotter-than-expected inflation prints, central bank hawkishness, and simmering tensions in the Taiwan Strait, and you’ve got the perfect cocktail for global market panic.
ASX SPI Futures are testing key support at 7735 with tech, financials, and China-leveraged names are firmly in the firing line.
Expect the usual safe-haven bid for gold producers and defensives — but outside that, it’s risk-off carnage across the board.
Overnight Wrap: Inflation Rears Its Head Again
There was no hiding overnight. Wall Street was hit hard.
S&P 500 futures plunged 5.09%
NASDAQ 100 futures down 5.61%
E-mini Dow futures down 4.27%
This wasn’t just a pullback — it was a wholesale liquidation event. A surge in VIX Futures to 26.38 says it all. Panic is firmly back on the menu.
It started with the macro. Inflation refuses to die. Sticky price pressures continue to challenge the ‘soft landing’ narrative, and with Donald Trump’s sweeping tariffs on Chinese goods coming into effect, the market is staring down the barrel of higher prices and deteriorating global trade conditions.
Bond were up as investors scrambled for a safe haven:
US 2Y yield down 3.80% to 3.696%
US 10Y yield down 2.16% to 4.038%
Europe fared slightly better than the US, but the heat is still on:
DAX Futures fell 3.23%
EURO STOXX 50 Futures dropped 3.80%
FTSE 100 Futures slipped 1.61%
STOXX 600 off 2.84%
Commodities weren’t spared. Gold Futures lost 0.92%, while WTI Crude Oil Futures plunged 7.10%, dragged lower by a deteriorating global demand outlook.
In Asia, Nikkei Futures dropped 3.41%, while China A50 Futures were down 0.50%. Hang Seng Futures lost another 0.11%. Add Taiwan tensions and weak trade data from South Korea into the mix, and the region looks fragile.
The Play Today
Extreme caution is warranted today, especially as traders will be wary of weekend developments.
Gold is slightly weaker on futures markets, but local gold miners could rally as panic fuels demand for tangible assets. Defensive plays like healthcare and consumer staples will likely outperform, but they won’t be immune from the selloff.
Everything cyclical is in danger.
Currency markets are also on edge. The AUD/USD is up 0.55% to 0.6332, but that bounce could be short-lived if the mood worsens. Watch the Japanese Yen, up 2.59% overnight. Aa clear sign that traders are rushing into traditional safety nets.
Major Themes Driving the Financial Markets:
Inflation in Japan: The return of inflation to Japan has major implications. Japanese Government Bonds are tanking as the market factors in higher rates over time. This has the potential to lead to a highly disruptive unravelling of the Yen Carry Trade.
Trade Tensions and Tariffs: The Trump administration's tariff policies continue to inject volatility into global markets. The potential for higher inflation and slower growth—stagflation—remains a concern. Nasdaq futures are up again overnight. AI, semis, and mega-cap tech are leading the charge globally. Can Aussie tech keep up?
Tech Sector Dynamics: Significant movements in major tech stocks, particularly companies like Tesla and Alphabet, highlight the sector's sensitivity to broader economic indicators and policy decisions. Investors should monitor these developments closely.
Economic Data to Watch this Week:
Economic Data to Watch This Week:
Monday: Chinese Manufacturing PMI, German Prelim CPI
Tuesday: RBA rate decision
Friday: US Non-farm Unemployment, Fed Chair Powell to talk
Global Market Prices
Global Markets (Source: TradingView)
ASX S&P200 SPI Future
The ASX SPI Future is testing key support at 7735. A break opens the way to 7598 and further volatility.
SPI - ASX S&P 200 Futures (Source: TradingView)
ASX Stock to Watch: Austin Engineering (ASX:ANG)
Austin Engineering is a US based manufacturer, supplying into the US market. So, will it see a benefit from these tariffs?
ASX Stocks to Watch (Source: TradingView)
