ASX 200 Closes 0.6% Lower on First Day of Fiscal Year

Australia's ASX 200 dipped 56 points or 0.6% to finish at 8,723 on Wednesday, the first day of the new financial year. Markets extended declines from the day before amid a sharp drop in U.S. stock futures following strong gains on Wall Street during H1 of 2026, supported by a continued surge in chip stocks. Caution lingered ahead of May trade data, due Thursday, after April exports outpaced imports to deliver a modest surplus. Meanwhile, building permits dropped for a third month in May, marking the fourth contraction this year. In its June meeting minutes, the central bank signalled further tightening remains possible after three hikes since January, citing rising Q2 cost pressures. Most sectors fell, led by commercial services, financials, logistics, and consumer names. The big four banks lost 1.5%–2.5%, while Greatland Resources (-4.7%), Coles Group (-4.2%), and Xero (-2.8%) slipped. In contrast, South32 surged 9.7% after agreeing to sell most of its aluminium assets to Alcoa.

Australian equities slipped 26 points, or 0.3%, to 8,751 on the first trading day of a new month, marking a second session of losses as retail trade, commercial services, producer manufacturing, and utilities weighed. Sentiment remained cautious at the start of the new financial year, with the Reserve Bank's June minutes underscoring inflation still well above the 2–3% target and underlying pressures mounting in Q2, leaving scope for further tightening after three hikes this year. Meanwhile, industry conditions remained deeply contracted in June despite a slight improvement from May, as higher costs and uncertainty lingered. Offshore cues added pressure: weaker U.S. futures followed Wall Street’s strongest quarter in six years, capped by volatility in chip stocks and geopolitical strains from the war in the Middle East. The big four banks fell between 0.6% and 1.7%, while sharp declines hit Coles Group (-6.7%), Greatland Resources (-4.7%), Whitehaven Coal (-2.8%), and Ampol (-1.1%).

The ASX 200 fell 45 points, or 0.5%, to close at 8,779 on Tuesday, snapping two sessions of gains as weakness in non-energy minerals, transport, and producer manufacturing weighed. Sentiment turned cautious after the Reserve Bank of Australia's June meeting minutes flagged inflation still well above the 2–3% target, with underlying pressures seen mounting in Q2. Policymakers signaled further tightening remains possible after three hikes this year, noting restrictive policy and elevated oil prices could temper demand and aid economic rebalancing. Two of the big four banks slipped between 0.3% and 0.7%, while BHP Group (-0.9%), Northern Star (-5.2%), and Evolution (-4.7%) lagged. In contrast, Euroz Hartleys jumped 7.6% after agreeing to sell its capital markets arm to Canada’s Bank of Montreal. Despite the pullback, the market logged a third straight monthly gain, up by 0.5% and around 3.5% for the quarter, underpinned by resilient spending, stronger jobs, and continued factory growth.