Australian shares plunged more than 2% on Thursday, led by commodity stocks and banks, as global investors reacted to the prospect of fewer rate cuts from the US Federal Reserve next year following its recent quarter-point rate reduction.
The S&P/ASX 200 index was down as much as 2.1% at 8136.6, as of 2357 GMT, its lowest level since Nov. 6.
The benchmark ended almost flat on Wednesday.
The Federal Open Market Committee (FOMC) reduced the Fed funds target rate by 25 basis points at its final meeting of 2024.
However, it lowered its projected rate cuts for 2025 from four to two, signalling a likely pause in January.
In Sydney, miners led losses in the benchmark index, dropping 2.3% as supply concerns eased and demand slightly slowed due to steelmakers in top consumer China conducting maintenance on more furnaces.
Mining behemoths BHP Group, Rio Tinto and Fortescue added between 1.6% and 3%. Gold miners followed suit, dropping as much 5% to their lowest levels since Nov. 18, as underlying bullion prices took a beating after the US Fed’s rate announcement.
Sub-index leaders Northern Star Resources and Evolution Mining slipped as much as 5.4% and 6.1%, respectively.
The financials dropped 2.2%, with the “Big Four” lenders down between 2.2% and 2.6%. Technology stocks fell as much as 3.6%, mirroring the drop in US Nasdaq.
Australian shares fall as miners offset real estate and healthcare gains
In company news, Woodside Energy said it entered into a deal with oil behemoth Chevron for an asset swap, with Chevron making a payment as much as $400 million to the company.
WDS stock lost as much as 1.7%. New Zealand’s benchmark S&P/NZX 50 index slipped as much as 1.4% to 12,689.910, marking its biggest intraday pct drop since Dec. 4.
Comments
Comments are closed for this article.