Live market updates: Wall Street's 'Wall of worry' triggers sharp decline, ASX expected to remain stable
Wall Street's tech-driven sell-off has triggered a 'Wall of worry', causing US stocks to plummet. This downturn is attributed to disappointing Palantir earnings and AI bubble concerns. However, the ASX appears to be unaffected, with ASX 200 futures holding steady at 8,831. The market's resilience contrasts with Wall Street's volatility, prompting questions about the impact of tech sector investments.
The Australian Securities and Investments Commission (ASIC) has launched major reports into private markets, particularly private credit, revealing that super funds invest 20-25% of their funds in these opaque areas. While these investments have a legitimate place, ASIC warns of poorly disclosed risks and high fees. Meanwhile, Norway's sovereign wealth fund, the seventh-largest Tesla shareholder, is voting against Elon Musk's share-based incentive package, which could be worth over a trillion dollars.
US banks are seeking record amounts of cash from the New York Fed's repo facility, indicating potential liquidity concerns. The Fed's quantitative tightening, a process of reducing the money supply, has been criticized for triggering a credit crunch. Despite these concerns, the ASX's stability suggests that local traders may be diversifying away from US big tech investments.
The tech sector's sell-off is led by Palantir's earnings report, with traders expecting more. Financial news services cite old comments from Wall Street leaders as catalysts, but experts caution against overreacting. The market's correction is a natural part of the cycle, and analysts predict a recovery. As of today, the S&P 500 and Nasdaq indices are down 1.2% and 1.9%, respectively, with less than an hour of trade left.
