ASX 200 Extends Slide Amid U.S. Strike Concerns, Price Pressures

Australia's ASX 200 fell 67 points, or 0.8%, to finish at 8,661 on Thursday, marking a second straight session of decline and nearing a one-week low. Sentiment weakened after U.S. stock futures slipped as President Donald Trump ruled out a deal with Iran, with reports suggesting the U.S. military is preparing possible strikes ahead of the midterms. Domestically, October inflation expectations climbed to a four-month high, underscoring persistent price pressures from elevated global energy costs even as the Reserve Bank continues its policy tightening. Losses were broad, led by tech, non-energy minerals, industrial services, and logistics. The four major banks each shed around 1.5%, while BHP Group dropped 2.0% and Rio Tinto slid 2.9%. Fortescue dipped 1.4% amid a standoff with China Mineral Resources Group over long-term iron ore contracts. Other notable laggards included Lottery Corp. (-3.8%), Xero (-3.0%), and Endeavor Group (-1.7%).

Australian shares slipped 26 points, or 0.3%, to 8,701 in early Thursday trade, extending the prior session’s drop as subdued U.S. stock futures followed Wall Street’s break from recent winning streaks overnight. Surging Treasury yields reignited inflation concerns, while Fed minutes revealed divisions over the rationale for further hikes, with most officials anticipating another move by year-end. Locally, October inflation expectations rose to a four-month high, reflecting persistent price pressures amid elevated global energy costs linked to Middle East tensions. Losses were contained as markets in top trading partner China prepared to reopen after the Golden Week holiday. Tech, non-energy minerals, and logistics drove weakness, though gains in consumer non-durables, energy minerals, and retail trade limited downside. Heavyweight BHP Group fell 2.4%, while Lynas Rare Earths (-4.4%), Fortescue (-3.4%), Evolution Mining (-2.2%), and Northern Star Resources (-2.0%) also weighed.

The ASX 200 closed nearly flat at 8,728 on Wednesday, as gains in utilities, healthcare, and industrial services were offset by declines in tech, transport, and financials. The muted tone followed three sessions of advances, with U.S. stock futures softening after Wall Street hit fresh records Tuesday on a tech rally. Locally, September data showed Australia's industry activity slumping, with firms citing tighter access to finance and persistent cost pressures amid renewed fuel-driven inflation. Mining giant BHP Group slipped 0.7% after agreeing to sell its Kambalda nickel concentrator and related assets to Gold Fields, with completion slated for 2027. The move follows BHP’s suspension of broader WA nickel operations in 2024 due to oversupply. Three of the four major banks lost between 0.8% and 1.3%. On the upside, Evolution Mining rose 2.5%, Northern Star Resources gained 1.9%, PLS Group added 1.8%, and Lynas Rare Earths advanced 1.6%.