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Highlights:
- S&P 500 posts eight-day win streak but ends session near lows
- Meta (NASDAQ:META) and Microsoft (NASDAQ:MSFT) surpass expectations, boosting tech sentiment
- Block (ASX:SQ2) shares set for steep decline after sharp earnings miss and downgraded outlook
The ASX 200 is set to open lower, with futures down 32 points (-0.39%) as of early morning trade, following a mixed overnight session on Wall Street. Despite strong recent momentum, major US indices faded sharply into the close, tempering enthusiasm from another round of blockbuster big tech earnings. The S&P 500 extended its winning streak to eight sessions—the longest since 2021—driven by robust earnings from several “Magnificent Seven” names. Microsoft reported a 13% rise in total revenue to $70 billion, with its Azure cloud unit accelerating to 35% year-over-year growth, beating guidance. Meta delivered a 16% jump in quarterly revenue, raised its 2025 capital expenditure forecast to up to $72 billion, and highlighted its AI roadmap as a key growth driver across advertising, engagement, and emerging hardware.
Despite strong corporate results, sentiment cooled as investors grappled with broader macro risks. Oil prices surged after the US imposed fresh sanctions on Iranian oil-trading entities, raising geopolitical tensions ahead of nuclear talks. The US Federal Reserve held rates steady, brushing off market bets for multiple cuts this year, while the Bank of Japan and Bank of England signaled caution amid global tariff concerns. Former President Trump stirred trade tensions further, hinting at potential deals with India, South Korea, and Japan, but taking aim at China as the main trade adversary. Market participants largely expect limited progress on tariff negotiations this month, keeping pressure on trade-sensitive sectors.
In the corporate sphere, Block (ASX:SQ2), the payments company formerly known as Square, rattled investors by missing first-quarter earnings expectations by a sharp 42% margin, reporting EPS of $0.56 against a $0.97 estimate. Management also cut full-year gross profit guidance by 2.5% to $9.96 billion, citing a “more dynamic macro environment” and soft Q2 projections. Shares plunged roughly 18% in after-hours trade, setting up for a potentially heavy open on the ASX. Elsewhere, Kingsgate Consolidated (ASX:KCN) announced plans for a share buyback program over the next 12 months, Qube Holdings (ASX:QUB) reaffirmed its full-year growth targets, and ResMed (ASX:RMD) disclosed its acquisition of VirtuOx, a US-based diagnostic testing facility, to expand its sleep and respiratory care portfolio. Rio Tinto (ASX:RIO) shareholders voted decisively against an independent review of the company’s dual-listed structure, while Wisetech (ASX:WTC) is reportedly in advanced talks to acquire US supply chain software firm e2open for up to $3.5 billion.
Looking ahead, investors will be watching whether the recent rally can hold or if the market will cool after such a strong run. Gold prices, now on a three-day losing streak and down 3.1%, remain under pressure amid reports of waning Chinese demand and potential stockpile reductions, dragging gold mining stocks lower. The Gold Miner ETF (NYSEARCA:GDX) slipped 3.6% overnight to its weakest level since mid-April.
