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The Australian stock market is expected to start the week down as a result of escalating tensions between the United States and Iran.
Iran's seizure of two oil tankers – a British one – after the United States said its navy had shot down an Iranian UAV in the Strait of Hormuz would be a key part of the market in the next 24 to 48 hours, said the chief economist of CommSec, Craig James.
Growing worries over relations between the United States and Iran resulted in a 69-point decline in the Dow Jones. This decline should be reflected Monday on the Australian market.
"We are expecting a fall in futures in the face of the weakness that the United States experienced on Friday," James told AAP Sunday.
"The relationship between the United States and Iran is causing some concern."
The ASX / 200 Futures is expected to start the week down 26 points after a positive day on Friday.
A decline in the US market this weekend, with the Nasdaq, which has a high technicality, also fell 61 points, which means that the ASX / 200 will have to be corrected Monday, added Mr. James.
The US market will also see interest rate cuts of 25 basis points at the end of July as the US central bank is not ready to make a larger 50 basis point cut, which was expected before.
On the domestic market, traders will attend a speech on inflation delivered Thursday afternoon by Governor of the Reserve Bank of Australia, Philip Lowe.
CommBank is also expected to release Monday its monthly business figure indicator.
But, Mr James said the market will mainly focus on developments between the United States and Iran.
The Australian dollar lost some ground and buys 70.4 US cents, down 70.63 cents US on Friday.
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