ASX 200 Turns Early Strength to Finish Lower

The S&P/ASX 200 slipped 24 points, or 0.3%, to close at 8,955 on Thursday, reversing morning gains and a two-day advance as weakness in process industries, non-energy minerals, logistics, and financials weighed. Sentiment soured after April data showed inflation expectations in Australia jumped to their highest since November 2022, stoking cost-pressure concerns. Employment growth also slowed to a four-month low in March, driven by a drop in part-time jobs. Traders remained cautious after China’s Q1 2026 GDP beat forecasts, but face risks of softer growth if the Middle East crisis drags on. In the U.S., President Trump said the war with Iran was “close to over,” though Washington’s port blockade keeps supply-disruption risks elevated. Australia’s “big four” banks fell 1.3%–2.8%, while notable laggards included Reece Ltd. (-5.3%), Viva Energy (-4.5%), Evolution Mining (-4.2%), and Greatland Resources (-4.0%).

Australian equities edged 20 points higher, or 0.2%, to 8,999 in Thursday morning’s trade, extending gains for the third straight session after Wall Street’s S&P 500 and Nasdaq closed at record highs overnight on upbeat earnings and optimism over US-Iran talks. Investors awaited local releases later in the day, including April inflation expectations and March labor market figures. At the same time, focus turned to the upcoming Q1 GDP and March activity data in top trading partner China, which cover industrial output, retail sales, and unemployment. Gains were capped by recent remarks from Treasurer Jim Chalmers, who said Australians were “paying a hefty price for events on the other side of the world", referring to the Middle East conflict. Commercial services, healthcare, and consumer durables led the advance, though softness in process industries and logistics capped momentum. Early movers included Pro Medicus (7.5%), Technology One (5.8%), Xero Ltd. (6.9%), and REA Group (4.6%).

The S&P/ASX 200 was little changed on Wednesday, closing at 8,979 after edging higher in early deals, as gains in healthcare, commercial services, and producer manufacturing were offset by losses in energy minerals, consumer durables, and industrial services. Risk appetite faded a touch as U.S. stock futures were mixed, with traders assessing the path of the U.S.-Iran war amid uncertainty about renewed peace talks. At the same time, vigilance emerged ahead of the releases of March labor market data in Australia and Q1 GDP figures in top trading partner China, both scheduled for Thursday. Meantime, the IMF warned the US–Israel war on Iran risks triggering an “energy crisis of unprecedented scale” that could push the global economy into recession. Evolution Mining (9.1%), Pro Medicus (4.0%), and Wisetech Global (2.9%) advanced while Lynas Rare Earths Ltd. (-6.6%), Santos (-2.6%), and Yancoal Australia (-2.2%) lagged.