ASX 200 Ends Week Down 0.8% as RBA Rate Decision Nears

Australia’s ASX 200 lost 37 points, or 0.4%, to end at 8,665 on Friday, marking a second session of losses as caution grew ahead of next week’s Reserve Bank policy decision. Sticky inflation has fueled expectations of further rate hikes following three moves earlier this year, while August inflation data is also due after July’s reading exceeded forecasts and remained above the central bank’s 2–3% target band. Separately, August labor data showed mixed signals, with the jobless rate rising to a near five-year high of 4.6%, while employment rose more than expected. In the U.S., a summit between President Trump and Chinese leader Xi Jinping failed to produce breakthroughs on key geopolitical issues, despite an extension of their trade truce. Most sectors slid, led by tech, consumer services, and logistics. Mineral Resources (-4.8%), PLS Group (-3.7%), REA Group (-3.2%), and Xero (-2.8%) posted heavy losses. For the week, the index fell 0.8%, marking its fourth straight weekly decline.

Australian shares fell 47 points or 0.5% to 8,655 in Friday morning trade, extending losses as U.S. futures weakened after Wall Street’s choppy session overnight, pressured by rising Treasury yields and volatile oil prices. Local sentiment stayed cautious ahead of next week’s policy decision, with persistent inflation fueling expectations of another rate hike after three moves earlier this year. August labor data painted a mixed picture: the jobless rate climbed to a near five-year high of 4.6%, but employment rose more than forecast. Sectoral weakness was broad, led by tech, non-energy minerals, logistics, and industrials, with notable laggards including Xero Ltd. (-2.9%), Greatland Resources (-2.5%), REA Group (-2.2%), and Aristocrat Leisure (-2.1%). In contrast, the four major banks edged higher, up between 0.2% and 0.4%. For the week, the market is set for a fourth straight decline, down about 0.9% so far. Markets now eye U.S. President Trump–Xi Jinping summit for policy direction.

The ASX 200 eased 63 points, or 0.7%, to close at 8,702 on Thursday, snapping recent gains as U.S. stock futures fell amid concerns over more Fed tightening after last week’s first rate hike since 2023. Locally, traders weighed the risk of a hawkish move from the Reserve Bank of Australia at next week’s meeting amid stubborn inflation. Still, markets trimmed early weakness after fresh data showed unemployment edged up to 4.6% in August, slightly above consensus. Governor Bullock earlier noted that joblessness in the 4.5%–5.0% range could help restrain inflation. Manufacturing, non-energy minerals, and commercial services lagged, partially offset by strength in energy minerals and logistics. A stronger U.S. dollar and softer copper weighed on resources, with BHP and Rio Tinto down 1.8% and 1.2%. The big four banks fell 1.0%–1.9%, while other notable decliners included PLS Group (-6.1%) and HUB24 (-3.5%). Energy stocks bucked the trend, lifted by Santos (2.1%) and Woodside Energy (1.5%).