Australian markets face ongoing volatility and potential downturn

Australian sharemarket volatility persists; experts warn worst may not be over amidst ongoing US-China tariff tensions.

In Short

AMP economist Shane Oliver warns that the Australian sharemarket hasn’t hit its lowest point yet, despite recent fluctuations caused by US tariffs.

Experts advise investors to maintain long-term strategies and avoid rash decisions due to market volatility.

The Australian sharemarket is not at its lowest point yet, according to AMP chief economist Shane Oliver.

Last week, share markets experienced significant fluctuations due to ongoing concerns regarding US tariffs initiated by President Donald Trump.

The markets plunged but rebounded after Trump announced a 90-day delay on some tariffs.

Despite the recent recovery, Oliver cautioned that the worst may not be over for investors. He noted that while markets can influence Trump’s decisions, the long-term outlook remains uncertain due to the tariff disputes.

Growth forecasts

Investment risks in the US market continue to mount, impacting growth forecasts.

Zenith Investment Partners‘ Damien Hennessy described the tariffs as a $700 billion tax shock, potentially raising core inflation beyond the Federal Reserve’s target and significantly affecting US GDP growth. Oliver highlighted that past recessions often saw erratic market behaviours, emphasizing the importance of monitoring market lows.

The ASX experienced a volatile week, initially falling before rising sharply after Trump’s tariff retraction, ultimately ending the week down 0.28%.

Experts suggest that while markets can change rapidly, investors should stick to their long-term strategies. Richard Weiss of American Century Investments advised against making speculative purchases driven by market fluctuations.