The Australian sharemarket is set for a flat start on the second-last day of the year, after stocks slipped overnight on Wall Street as traders pared bets on the tech giants before the end of the year and volatility hit precious metals.
ASX futures were edging up 5 points, or less than 0.1 per cent, to 8721 as of 7.25am AEDT. In New York afternoon trading, the S&P 500 fell 0.4 per cent, with shares of Tesla, Nvidia and Meta Platform among the losers. The US stock benchmark index is still up close to 18 per cent for the year. The Dow Jones Industrial Average fell 0.4 per cent. The Nasdaq composite dropped 0.6 per cent.
New York kicked off the week leading into the New Year on a cautious note.Credit: Bloomberg
The weakness in equities โis a reversal from last week when tech stocks led on the way up,โ said Joe Mazzola, head trading and derivatives strategist at Charles Schwab. However, it โdoesnโt appear connected to any single fundamental factor.โ
The Australian dollar was trading at US66.93ยข, down 0.3 per cent, as of 7.39am AEDT. Markets face another short week in the final stretch of 2025. Wall Street will be closed on Thursday for New Yearโs Day, while the ASX finishes New Yearโs Eve early and is closed for New Yearโs Day.
Gold and silver plunged overnight, setting metal stocks up for swings on the local market, as traders booked profit following a powerful year-end rally that sent both metals to record highs, with thin market liquidity exacerbating the price swings.
Spot gold fell as much as 5 per cent, marking the biggest intraday drop since October 21, though prices for the precious metal are still up about 64 per cent for the year. Silver tumbled 11 per cent in its biggest intraday decline since September 2020, but it has still more than doubled overall in 2025. Both metals posted a sharp retreat from fresh all-time highs that triggered signals that their rally to records had run too fast, too soon.
โDonโt read into massive moves,โ said Michael Haigh, head of FIC and Commodity Research at Sociรฉtรฉ Gรฉnรฉrale, adding that the end of every year tends to be โso illiquid.โ
Big technology stocks with outsized valuations were among the heaviest weights on the US market. Nvidia fell 1.3 per cent and Tesla was down 2.7 per cent. Investor optimism about the future of artificial intelligence has been driving the sector mostly higher all year and pushing the broader market to a series of records.
Technology stocks have been more unsteady as the year heads to a close, though. They mostly slipped in November and have only notched modest gains through December. Nvidia and several other companies focusing on AI or benefiting heavily from the developing technology have become some of the most valuable in the world. Investors have seemingly become more sceptical about whether the eventual payoff will make the hefty investments worthwhile.
