Australian shares are set to open modestly lower, dragged down by a wave of selling in New York after Nvidia’s blockbuster quarterly results failed to offset concerns AI is poised for further disruption.

Oil gave up all its earlier gains after the US and Iran agreed to extend their talks into next week after a third round of negotiations in Geneva on Thursday (Friday AEDT).

ASX 200 futures were down 11 points or 0.1 per cent to 9151 near 7.15am AEDT. The S&P 500 were 0.6 per cent lower at 3.17pm in New York, halving earlier losses.

Nvidia slumped 5.6 per cent. Broadcom shed 4.5 per cent. The Philadelphia semiconductor index lost 3.8 per cent. Barring a massive late day turnaround, this will be the seventh straight quarter where Nvidia shares fell from the open to the close of trading on the day after it reports earnings.

“The fact that Nvidia just posted $US68.1 billion ($95.8 billion) in quarterly revenue, yet markets are unimpressed, is telling,” said to Adam Kobeissi, who publishes The Kobeissi Letter. “Nvidia’s free cash flow jumped nearly $US20 billion year-over-year and the company crushed just about all expectations.”

“Because expectations are so high that it’s becoming difficult to impress, Kobeissi said in a post on X. “At this stage, companies do not just need to beat earnings, they need to beat the beat.”

In its first six earnings reports following the release of ChatGPT, Nvidia shares averaged a one-day gain of more than 10 per cent on its earnings reaction day, according to Bespoke Investment. Following its last seven reports, though, shares have averaged a decline of 3 per cent.

In contrast to the collapse in chip stocks, software shares rebounded. Atlassian was 8.4 per cent higher, helping to almost reverse its losses over the past five days.

Market highlights

ASX 200 futures are pointing down 11 points or 0.1 per cent to 9151.
All US prices near 3.15pm New York time.

AUD -0.2% to US71.09¢Bitcoin -1.5% to $US67,722On Wall St: Dow -0.4% S&P -1.1% Nasdaq -1.9%VIX +0.80 to 18.73Gold +0.5% to $US5192.38 an ounceBrent oil -0.03% to $US70.83 a barrelIron ore +0.1% to $US98.30 a tonne10-year yield: US 4.01% Australia 4.70%Today’s agenda

Results pending on Friday: Airtasker (ART) | Coles (COL) | Harvey Norman (HVN) | PEXA (PXA) | TPG Telecom (TPG) | Virgin Australia (VGN) | Star Entertainment (SGR)

Private sector credit data for January is set for release at 11.30am. Overseas, there are CPI reports pending from France and Germany and early on Saturday, PPI data from the US.

Top stories

Albanese can’t get out in front on Trump like Carney can | Don’t be surprised if the prime minister dials it back a touch next week, regardless of how hard his Canadian counterpart, Mark Carney, may lean in.

Woolworths’ AI assistant goes rogue, starts talking about its mother | Olive has been around for years, but has recently become more sophisticated after the supermarket partnered with Google. Shoppers are noticing some oddities.

Labor moves to protect spies appearing at Bondi royal commission | Attorney-General Michelle Rowland has announced she will introduce legislation when parliament returns next week to shield spooks who appear before the inquiry.

Chanticleer: The ‘meh’ reaction to Nvidia’s profit stunner shows that other AI risk | Investors are worried AI will smash software businesses, but concerns about too much spending on the infrastructure for too little in returns haven’t gone away.