ASX Retreats 3.0% Weekly as Inflation Fears Mount

The ASX 200 slid 78 points, or 0.9%, to end at 8,741 on Friday, its lowest in seven weeks. The benchmark index fell for a fourth straight session, logging its worst week in six months with a 3.0% slide. Sentiment weakened as surging crude oil prices raised doubts over a quick easing in Australia's inflation. RBA Deputy Governor Hauser said further hikes will be debated at September’s meeting, echoed by Assistant Governor Hunter’s warning of limited tolerance for stronger cost pressures. The country's 10-year bond yield spiked above 5.3%, the highest since May 2011, tracking U.S. Treasury gains and reinforcing expectations of tighter borrowing conditions. Losses were broad, led by healthcare, non-energy minerals, tech, and consumer stocks. Major miners tumbled, with BHP down 4.3%, Rio Tinto off 3.7%, and Fortescue slipping 2.4%. South32 (-4.4%), Northern Star Resources (-2.3%), and Evolution Mining (-2.0%) also lagged. In contrast, the big four banks gained between 0.6% and 2.5%.

Australian shares dipped 72 points, or 0.8%, to 8,747 on Friday morning, down for the fourth session to hit their lowest in near two months. Losses were broad, led by healthcare, tech, non-energy minerals, and logistics, as Wall Street’s overnight slide weighed on sentiment. Rising U.S. Treasury yields and Brent crude above USD107 fueled inflation and rate-hike fears, while President Trump warned energy costs may stay high until after November’s vote. Locally, concerns grew that elevated rates and sticky inflation could tip the economy into a slowdown. RBA Deputy Gov. Hauser said further tightening will be debated at September’s meeting, echoed by Assistant Gov. Sarah Hunter’s warning of limited tolerance for stronger cost pressures. Heavyweights BHP (-4.1%), Evolution Mining (-3.8%), and Northern Star Resources (-3.6%) fell, though the big four banks bucked the trend, up between 0.2%–1.4%. For the week, the market is on track for a second straight weekly drop, down nearly 3% so far.

The ASX 200 tumbled 92 points or 1.0% to end at a six-week low of 8,804. Markets fell for the third session, as a rebound in U.S. futures failed to lift sentiment after Wall Street logged its third drop Wednesday, pressured by escalating U.S.–Iran tensions that sent Brent crude above USD100 a barrel, stoking inflation fears. Locally, RBA Deputy Gov. Andrew Hauser said policymakers will weigh further tightening at the September meeting, while Assistant Governor Sarah Hunter warned of limited tolerance for stronger price pressures. The hawkish tone prompted all four major banks to forecast another hike before year-end, with NAB tipping September and others November. Losses were broad, led by healthcare, non-energy minerals, tech, and financials. The big four banks slipped between 0.9% and 1.8%, while BHP (-2.4%) and Rio Tinto (-3.1%) also slid. Other laggards included PLS (-3.8%), Nextdc (-3.3%), and Lynas (-2.9%). Gains in Cochlear (1.6%) and Suncorp (1.3%) offered some support.