Aussie Stocks Retreat to 5-Month Lows

The ASX 200 finished flat at 8,731 on Friday, following recent gains, with strength in tech, industrial services, and non-energy minerals offset by weakness in healthcare, energy names, and consumer non-durables. Early gains faded after Reserve Bank of Australia's Governor Michele Bullock struck a hawkish tone in parliament, warning inflation remains stubbornly high and upside risks are materializing, keeping the door open for further hikes. Meanwhile, U.S. stock futures firmed on softer oil prices and U.S. Treasury yields. Heavyweight BHP Group climbed 1.4%, while gold miners Evolution Mining (4.4%) and Northern Star Resources (2.4%) also advanced. In contrast, the big four banks slipped between 0.2% and 1.9%, with Xero (-4.1%) and Bluescope (-3.1%) also lagging. For the week, the benchmark index eased 0.1%, its third straight decline, as caution grew ahead of Australia's labor data for August, due next week, after July’s surprise rise in unemployment and drop in jobs.

Australian stocks edged up 14 points, or 0.2%, to 8,747 in early Friday trade, extending gains for a third straight session after Wall Street rebounded overnight as easing oil prices and softer Treasury yields helped calm nerves after the Fed’s rate-hike shock. Tech, non-energy minerals, and consumer durables drove the gains, though losses in healthcare, energy minerals, and retail trade capped the upside. Gold miners advanced, with Northern Star Resources up 2.7% and Evolution Mining rising 3.0%, while Lynas Rare Earths, Perseus Mining, and South32 each added over 2%. For the week, the domestic market was little changed, stabilizing after recent declines as traders weighed remarks before parliament from RBA Governor Michele Bullock, who warned that upside inflation risks are emerging amid surging global energy costs from the prolonged Middle East conflict, compounded by pressures from the AI data-centre boom and extreme weather.

The ASX 200 added 36 points, or 0.4%, to finish at 8,732 on Thursday, extending gains from the prior session as U.S. stock futures rallied after the Federal Reserve raised borrowing costs for the first time since 2023. Analysts said the move bolstered the central bank’s credibility and reassured markets of its resolve to curb inflation. Locally, bargain hunting persisted after Australian shares hit a near ten-week low earlier this week, driving strength in financials, industries, and logistics. The big four banks surged between 1.3% and 2.6% after a volatile week shaped by rising domestic rate expectations. Insurers also advanced, with QBE up 1.1% and Insurance Australia 0.6% higher. Energy stocks lagged after oil prices retreated on a surprise build in U.S. crude inventories, while miners were subdued, with BHP edging lower and Rio Tinto flat. Traders now anticipate remarks from Reserve Bank Governor Michele Bullock, who is scheduled to testify before Parliament on Friday.