Australian shares are poised for a strong Tuesday open after Wall Street roared back overnight, with tech stocks driving the S&P 500 and Nasdaq to their biggest one-day gains since May. ASX 200 futures were up 86 points (+0.99%) at 8:30 am AEST, signalling a sharp rebound after the local market eked out a flat close on Monday.

Despite steep losses on Wall Street late last week, the ASX 200 finished Monday 1.7 points higher (+0.02%), supported by defensive sectors like gold, consumer staples, and healthcare. Small caps outperformed, with the Small Ords lifting 0.34%, while tech stocks and energy names lagged.

Wall Street rebounds sharply on tech strength and rate cut hopes

US stocks surged overnight, clawing back most of Friday’s losses after weak jobs data renewed expectations for a September Federal Reserve rate cut. The Nasdaq jumped 1.95%, the S&P 500 gained 1.47% and the Dow rose 1.34%, with buying led by the megacap tech cohort. Nvidia rose 3.6%, Meta 3.5%, and Alphabet added 3%.

The S&P 500 now sits within 1.5% of record highs, though some strategists warn of turbulence ahead. Morgan Stanley and Evercore strategists are forecasting a correction of 10–15% in coming months, citing stretched valuations and rising tariff risks. Even so, broad market sentiment has improved, with US Treasury yields dipping and the US dollar softening for a second straight session.

In Europe, stocks also rallied as the EU moved to suspend tariffs on US imports for six months. The Euro Stoxx 50 gained 1.5%, while Germany’s DAX and the UK’s FTSE 100 rose 1.4% and 0.7%, respectively. Swiss shares underperformed, however, still reeling from the impact of Trump’s new 39% tariffs.

Gold breaks out again, oil dips as OPEC+ boosts supply

Gold rose 0.8% to US$3,426 an ounce overnight, hitting its highest level since early 2012, buoyed by falling yields and a weaker US dollar. Spot gold hovered near US$3,373 in late trade. The rally sent the Gold Miners ETF up 4.7%, with ASX-listed gold stocks likely to remain in focus today.

Oil prices slid, with Brent down 1.3% to US$68.76 and WTI off 1.6% at US$66.24, after OPEC+ confirmed it would unwind the final phase of its 2023 production cuts from September. While the move adds 547,000 barrels per day to global supply, traders are watching geopolitical risks closely, particularly Trump’s threats of 100% tariffs on Russian crude buyers and sanctions on India.

Copper edged up 0.3%, and iron ore climbed 1.2% to US$100.77/t on stronger Chinese steel margins and falling port inventories.

Local earnings, economic data on tap

Today’s local economic releases include ANZ-Indeed job ads and household spending data at 11:30 am AEST. On the corporate front, Credit Corp Group (ASX:CCP) will report FY25 results, offering insights into consumer credit trends amid elevated rates and rising arrears.

Investors will also be eyeing follow-through strength in gold and tech stocks, given the overnight lead, as well as any sector rotation after yesterday’s defensive tilt. With key developments expected from macro data out of Australia, China, and the US later in the week, traders are likely to remain cautious yet alert to signs of momentum shifting.