Australia Stocks Rebound But Head for Weakest Month Since 2022

Australian stocks rose 73 points, or 0.9%, to 8,534 in afternoon trade on Tuesday, snapping a three-session losing streak as U.S. futures advanced after Wall Street closed mostly lower Monday in a holiday-shortened week. Sentiment was lifted by domestic data showing resilient February private credit growth, broadly in line with estimates. Top gainers included Xero (5.1%), Northern Star Resources (3.0%), REA Group (2.5%), and CSL (2.0%). However, the market is on track for its first weekly decline in four, down about 7% so far and set for its weakest month since January 2022, amid inflation concerns tied to the widening Middle East conflict. Meanwhile, minutes from the Reserve Bank’s March meeting showed members agreed further tightening would likely be needed, though timing remained uncertain. Policymakers also warned that if oil prices hold near USD 100 a barrel, headline inflation could climb to around 5% in Q2 2026.

The S&P/ASX 200 was down 60 points, or 0.7%, to close at 8,456 on Monday, marking a third straight decline amid broad-based losses, led by logistics, producer manufacturing, financials, and healthcare. Sentiment remained downbeat on growing fears that Australia’s economic outlook has shifted materially amid renewed Middle East conflict, with higher energy prices expected to fuel inflation, slow growth, and lift unemployment. Adding pressure, LNG production stayed offline, and thousands were still without power in the northwest part of Australia, over a week after severe storms, Reuters reported. In the U.S., rate expectations flipped, with markets now pricing 12bps of Fed tightening this year versus 50bps of cuts a month ago. Four major banks slipped between 1.7% to 3.8%. Meanwhile, Wisetech Global (-4.9%), Pro Medicus (-2.7%), and Qantas (-1.9%) led other decliners. Traders now await upcoming releases, including RBA minutes, U.S. NFP data, and global PMIs, all due later this week.

Australian shares dropped 82 points, or 1.0%, to 8,434 in early Monday trade, marking a third straight decline as risk sentiment weakened. The drop tracked softer U.S. futures, with the Iran war entering its fifth week and raising concerns over broader economic fallout, particularly via higher energy costs. Also, caution mounted ahead of key U.S. NFP data this week, alongside global manufacturing and services PMI figures. Economists expect these readings to show a slowdown in March, reflecting high energy prices linked to the conflict. Meanwhile, the OECD last week warned that Australia could face one of the highest inflation rates among advanced economies. Major players in the transport sector, including Uber and Qantas, are announcing price hikes, local media said. Losses were broad-based, led by consumer, industrial services, logistics, and financial stocks. Notable decliners included Wisetech Global (-5.5%), Xero (-4.7%), Mineral Resources (-2.9%), and Ramsay Health Care (-2.2%).