Australian Stocks End at 4-Month Low

The S&P/ASX 200 slid 1.7% to close at 8,498 on Thursday, breaking a two-session winning streak to hit a four-month low, after mixed labor market data did little to alter expectations of further rate hikes. Data showed employment jumped a strong 48,900 in February, well above the forecasted 20,000 gain, while the unemployment rate unexpectedly climbed to 4.3% as more people went looking for work. The rate remains historically low and reinforced the Reserve Bank’s view that the economy can withstand tighter policy. Meanwhile, the central bank warned that the conflict in the Middle East poses a material risk to the domestic economy and signaled a more severe global shock. The ongoing Iranian attacks on Middle Eastern energy facilities also revived inflation concerns as oil prices surged again. This pushed the energy sub-index up over 5% to its highest since February 2024. However, most sectors retreated, led by banks, miners, and technology stocks.

The S&P/ASX 200 dropped 1.6% to around 8,500 in early Thursday deals, ending a two-session advance as a fresh spike in oil prices, triggered by attacks on Middle Eastern energy facilities, revived inflation concerns. This reinforced the Reserve Bank of Australia’s hawkish stance, as it has repeatedly warned about persistent inflation risks and signaled uncertainty over whether policy is tight enough. After the central bank delivered a back-to-back rate hike in a split decision, markets now await the upcoming jobs report for further clues on the policy outlook. A sharp overnight selloff on Wall Street also weighed, where stronger US PPI data and the Fed’s higher inflation projections dampened bets for rate cuts. Most sectors retreated, led by resource and technology stocks. Among the heavyweights, miners BHP and Rio Tinto fell 2% to 3%, gold producer Northern Star plunged 8%, and software provider Wisetech Global dropped 4%. Conversely, energy firms climbed amid a surge in oil prices.

The S&P/ASX 200 ended 0.3% higher at 8,644 on Wednesday, extending gains from the previous session as strength in tech and energy stocks lifted the market. The index struggled for direction earlier in the session, a day after the Reserve Bank of Australia delivered a back-to-back rate hike in a narrow call. The central bank flagged that the intensifying Middle East war poses a risk to inflation. However, this pushed the energy sector up 0.7% as oil prices climbed on renewed Iranian attacks on the UAE, fueling concerns over tightening global supply. Oil and gas producer Woodside Energy edged up after naming Liz Westcott as CEO and managing director, while Santos (0.8%) and Beach Energy (2.5%) also posted gains. Technology stocks added 1.6%, tracking their Wall Street peers, and the mining sub-index finished 0.4% up. Heavyweight miner BHP Group also jumped 0.7% after naming Brandon Craig, its Americas president, as CEO to succeed Mike Henry, while Rio Tinto gained 0.8%.