ASX 200 Poised for Decline as Wall Street Weakness Persists

Highlights: 

• Nasdaq Logs Steep Decline: The worst trading session in a month amid investor concerns over economic data. 
• S&P 500 Turns Negative for 2025: Market sentiment deteriorates ahead of upcoming inflation updates. 
• Trump Tariff Uncertainty: Global trade faces volatility as investors assess potential economic impacts. 

The ASX 200 is set to open lower, with futures indicating a decline of 69 points (-0.84%) as of 8:30 am AEDT. Market sentiment remains fragile as Wall Street continues to face turbulence. Overnight, major US indices closed near their session lows, reflecting growing investor concerns about economic resilience and trade policies. The S&P 500 and Nasdaq are both on track for their worst weekly performance since September, with market uncertainty heightened by ongoing macroeconomic and geopolitical developments. 

US Market Performance 

The Nasdaq posted its worst trading day in a month as technology stocks faced selling pressure. The S&P 500 slipped into negative territory for 2025 ahead of a crucial inflation update. Weaker consumer spending data and slowing business activity have added to investor anxiety. 

US hedge funds are increasingly betting on a turnaround in China's struggling property sector, but broader sentiment toward small-cap stocks remains weak. JPMorgan analysts suggest that US equities may face a challenging start to March due to softer economic data, with a potential rebound anticipated later in the season. The shift in sentiment has prompted investors to reassess risk exposure across multiple asset classes. 

Stock Movements 

Several major companies experienced notable price swings: 

• eBay Inc. (NASDAQ:EBAY): Shares declined after first-quarter revenue guidance fell short of Wall Street expectations. 

• Rolls-Royce Holdings plc (LSE: RR.): Shares surged following better-than-expected full-year earnings. 

• Microsoft Corporation (NASDAQ:MSFT): The company is lobbying for regulatory changes that would ease restrictions on AI chip exports. 

• Salesforce Inc. (NYSE:CRM): The company's revenue outlook disappointed amid slower adoption of the Agentforce platform. 

• Nissan Motor Co., Ltd. (TYO: 7201): Reports suggest the company is preparing to replace its CEO following a failed deal with Honda. 

• CoreWeave: The AI infrastructure company is considering an IPO in the US, aiming to raise approximately $4 billion. 

• Mercedes-Benz Group AG (ETR: MBG): Plans to implement job cuts in China due to increased competition. 

• BP plc (LSE: BP.): Activist investor Elliott Management is increasing pressure on the company following investor dissatisfaction with its strategy. 

Geopolitical and Trade Developments 

Uncertainty looms over global trade as the Trump administration considers new tariffs, particularly affecting Canada, Mexico, and the European Union. A recent Federal Reserve study suggests that removing de minimis exemptions and imposing additional tariffs on Chinese imports could have a more significant economic impact than initially anticipated. 

China’s steel exports remain under pressure as Trump’s proposed tariffs threaten $7 billion worth of transshipments. The European Union's trade chief is expected to visit Beijing to navigate increasing trade tensions with the US. Meanwhile, Ukraine views its minerals agreement with the US as a stepping stone toward broader security collaboration. 

Critical minerals have become a focal point in US foreign policy, with high-pressure negotiations underway to secure key resources. The Trump administration has yet to clarify its stance on Taiwan, leaving geopolitical analysts speculating about potential policy shifts. Concerns are also growing over Washington’s evolving relationship with European allies, with debates emerging over whether the administration’s approach is one of indifference or hostility. 

Economic Indicators and Market Outlook 

Macroeconomic uncertainty continues to weigh on investor sentiment. The divergence between US and Eurozone inflation expectations has reached its highest level in three years. The impact of Trump's proposed spending cuts and tariffs on the broader US economy remains a key focus for analysts. 

ASX Company Reports 

Several ASX-listed companies released earnings and operational updates: 

• Life360 Inc. (ASX:360): Reported FY net income of $4.6 million, falling short of the consensus estimate of $12.5 million. 

• Fleetwood Ltd (ASX:FWD): H1 underlying NPAT rose to A$12 million from A$3.9 million a year ago. 

• Lotus Resources Ltd (ASX:LOT): Recorded a total comprehensive loss of A$3.9 million, an improvement from the A$8.9 million loss in the previous period. 

• PEXA Group Ltd (ASX:PXA): H1 underlying NPATA fell to A$13.2 million from A$15 million a year ago. The company announced a share buyback of up to A$50 million. 

• Downer EDI Ltd (ASX:DOW): Secured a field services agreement from Chorus Limited, valued at over NZ$550 million (~A$500 million). 

• Bellevue Gold Ltd (ASX:BGL): Reported H1 net profit after tax (NPAT) of A$12.1 million. 

Market Trends to Watch 

US equity markets closed near their session lows, potentially reversing the ASX 200’s recent rebound. Gold prices declined by 1.5%, which could pressure local mining stocks. However, oil prices rose by over 2%, potentially providing some support to energy stocks. The ASX 200 remains vulnerable to external market movements, with global trade uncertainties and inflation concerns continuing to shape investor sentiment. 

With heightened volatility in the US markets and shifting trade policies, the ASX 200 could face additional headwinds in the near term. Investors will be closely watching economic data releases and geopolitical developments to gauge market direction.