Global shares fall from record before US inflation data

Global shares have retreated from record highs before key US inflation data, while worries about shrinking margins for major tech companies and AI disruption fears simmered beneath the surface after a week of selling.

The MSCI all-country index slipped 0.2 per cent on Friday, while Europe's STOXX 600 was flat in early trading.

US futures were also flat following steep losses on Thursday that saw the technology-heavy Nasdaq Composite post its biggest daily drop in three weeks, tumbling two per cent.

The sell-off spilled over to Asia, where Japan's Nikkei fell 1.2 per cent.

US transportation companies were the latest sector to get caught up in worries about AI disruption on Thursday.

Against a more stable market backdrop on Friday, market watchers pointed to a broader rotation towards more defensive parts of the market and a refocus on macro-economics ahead of Friday's US consumer inflation data.

"Markets have had a healthy correction, they've skimmed some of the froth," Arun Sai, senior multi-asset strategist at Pictet Asset Management, said.

He noted that more speculative areas of the market such as meme stocks, high retail sentiment stocks, crypto and non-profitable tech had taken a hit.

"The focus goes back to macro. We had a strong labour market print. If we get a reasonable inflation print today, that would then go back to my narrative that global macro isn't in a bad place," he said.

But turbulence from AI-related worries remains in focus.

Worries over capital spending have hit shares in some of the world's biggest companies, including Apple, which fell five per cent on Thursday, while sectors from software to wealth management have come under pressure from concerns about AI disruption.

Elsewhere, The Financial Times reported on Friday that US President Donald Trump plans to scale back some tariffs on steel and aluminium goods.

The yield on benchmark 10-year US Treasuries rose two basis points to 4.12 per cent after falling seven basis points overnight, its biggest drop since October 10.

Fed funds futures also rallied to reverse most of the losses after the payrolls data that led markets to pare back the chance of a rate cut in June.

Much attention will be on the US inflation data due later on Friday.

Forecasts are centred on a monthly rise of 0.3 per cent in the core measure, which would be enough to see the annual rate slow to 2.5 per cent from 2.7 per cent previously.

Currency markets were stable ahead of the inflation report, with the euro down 0.1 per cent against the dollar to $US1.186.

The yen shed 0.5 per cent against the dollar to trade at 153.49, but remained on track for its strongest weekly gain in more than a year after Japanese Prime Minister Sanae Takaichi's historic election win last weekend.

The risk-sensitive Australian dollar took a step back, slipping 0.3 per cent to $US0.707, but was still headed for a weekly rise of almost one per cent.

Precious metals attempted to recover from heavy losses.

Gold rose 1.1 per cent to $US4,973.66 an ounce, after losing more than three per cent on Thursday, while silver climbed 4.6 per cent to $US78.6 an ounce, having plunged 10 per cent overnight.

Oil prices also rose after a three per cent slide on Thursday.

US West Texas Intermediate crude rose 0.3 per cent to $US63.03 a barrel, while Brent crude futures rose 0.24 per cent to $US67.7.