Australian Shares Start New Month Lower as RBA Decision Looms

The ASX 200 lost 52 points, or 0.6%, to close at 8,857 on the first trading day of a new month, halting gains in the prior two sessions as caution prevailed ahead of Tuesday’s Reserve Bank of Australia rate decision. The central bank is widely expected to deliver its fifth hike this year to curb persistent inflationary pressures. Meanwhile, manufacturing data in top trading partner China sent mixed signals, with the official PMI unexpectedly contracting while a private survey showed further expansion. Still, losses were partly capped by a sharp rise in U.S. stock futures as oil prices fell, amid reports that the U.S. and Iran are seeking diplomatic efforts on the Middle East conflict. Non-energy minerals, healthcare, logistics, and financials led declines, partly offset by strength in transport, consumer, and industrial services. Three of the four major banks fell, while BHP Group (-1.5%) and Rio Tinto (-1.2%) also slipped. Gold miners weakened, led by Northern Star Resources (-4.5%).

Australian stocks fell 26 points, or 0.3%, to 8,883 on the first trading day of November, reversing recent gains as tech, non-energy minerals, and healthcare stocks fell. Caution prevailed ahead of Tuesday’s Reserve Bank interest rate decision, with the central bank expected to raise its cash rate for the fifth time this year amid persistent inflationary pressure. In key trading partner China, official data showed an unexpected drop in manufacturing during October, partly reflecting the impact of the Golden Week break. However, losses were capped by fresh data showing a September rebound in Australia's building permits, driven by a recovery in private-sector dwellings excl. houses. In the U.S., stock futures strengthened ahead of further corporate earnings, jobs data, and the midterm elections. BHP Group fell 1.1% while Rio Tinto lost 1.4%. Gold miners like Northern Star (-3.9%) and Evolution Mining (-2.5%) also slipped. In contrast, the four major banks rose between 0.2% and 1.6%.

Australia's ASX 200 rose 16 points, or 0.2%, to close at 8,908 on Friday, extending prior gains as consumer discretionary, industrials, and commercial services stocks advanced. However, the index fell from an over seven-week high as early gains faded following a sharp drop in U.S. stock futures after Alphabet posted a historic share-price decline, reviving concerns over heavy AI spending. Meanwhile, caution prevailed ahead of official PMI data in top trading partner China this Saturday. Traders weighed the prospect of another RBA rate hike next week, following four increases this year, as inflation could stay elevated longer than expected. Wesfarmers (3.2%), Brambles (2.3%), and Aristocrat Leisure (2.0%) led gains. Woolworths rose 1.9% on stronger food sales. Conversely, Coles plunged 7.6% due to weak supermarket sales and a likely flat first-half EBIT. The index gained 1.3% for the week, reversing prior modest losses. It rose 1.4% for October, a turnaround from September's 3.2% fall.