Australia Stocks Eye Fourth Monthly Rise

The ASX 200 closed slightly firmer at 8,978 on Friday, clawing back losses from the prior session as strength in tech, non-energy minerals, and utilities offset broader caution. Sentiment was lifted by a rally in U.S. stock futures after Amazon’s upbeat earnings and a rebound in chip stocks on Wall Street Thursday. Gains, however, were capped by weaker factory activity in China, with July’s official PMI underscoring slowing demand from Australia’s key trading partner. Miners gained on higher copper prices, lifting Rio Tinto (1.0%) and South32 (0.8%), while gold producers Evolution Mining (1.8%) also advanced. However, the big four banks fell between 0.1% and 0.4%. Still, Australian equities booked their first weekly gain in a month, up 2.3%, and a fourth straight monthly rise, supported by robust private credit growth in June. Inflation worries also eased after softer June and Q2 readings, reinforcing views that the central bank’s three rate hikes this year are beginning to bite.

Australian shares advanced 34 points, or 0.4%, to 9,001 in early Friday trade, rebounding from the prior session’s weakness after Wall Street rallied overnight, as heavyweight chipmakers surged on renewed bets the AI-driven bull run still has legs. Gains were led by tech, non-energy minerals, industrial services, and utilities, though healthcare and consumer non-durables weighed. However, gains were capped by lingering caution over whether three rate hikes this year from the Reserve Bank will prove sufficient, with their full impact yet to filter through the economy. Standouts included BHP Group (2.4%), Lynas Rare Earths (4.7%), and Sandfire Resources (3.2%), while the big four banks added between 0.1% and 0.6%. Local markets are on track for weekly gains of more than 2%, reversing three straight weekly declines and setting up a fourth monthly rise. Momentum has been underpinned by easing inflation concerns and signs of resilience in manufacturing and services activity through July.

The ASX 200 slipped 71 points, or 0.8%, to finish at 8,968 on Thursday, halting a three-day rally and retreating from a near five-month high. Profit-taking followed Wall Street’s plunge on Wednesday, as traders weighed the U.S. Fed’s decision to hold interest rates steady, with three officials favoring a 25bps hike. Geopolitical tensions added pressure after Iran’s surprise strikes on U.S. bases in Jordan. At home, the Reserve Bank of Australia Assistant Governor Sarah Hunter noted headline inflation is easing, though housing and services costs remain sticky. Losses were widespread, led by tech, logistics, retail, and non-energy minerals. Softer iron ore and copper prices dragged BHP Group (-1.4%) and Fortescue (-0.9%). Gold miners tumbled, with steep losses in Northern Star Resources (-3.5%) and Evolution Mining (-2.8%). Two of the big four banks slipped between 0.5% and 0.8%. Bucking the trend, Domino Pizza surged 8.6% after reaffirming its annual profit outlook despite write-downs.