Australian shares closed lower on Friday and recorded their worst week since mid-June, as growing fears of aggressive rate hikes in the United States soured risk sentiment ahead of a key US jobs report. The S&P/ASX 200 index settled down 0.3% at 6,828.7.
The benchmark fell 3.9% this week, the biggest such decline in two-and-a-half months. Intensified tightening of monetary policies globally and weaker commodity prices have hit the resource-heavy bourse.
“This is what I’d call a nervous market,” said Brad Smoling, Manging Director at Smoling Stockbroking. Market participants look ahead to US August non-farm payroll data due later in the day.
Investors may not like a strong number if it supports a continuation of aggressive rate hikes from the Federal Reserve.
Australia-focused investors also await a central bank rate decision next week.
Economists polled by Reuters expect another half point hike by the Reserve Bank of Australia, to curb soaring inflation.
Mining stocks fell 2.2% on Friday, hurt by weaker iron ore and base metal prices on China demand woes.
The sub-index fell nearly 11% in the week, posting its biggest drop since August 2021. Separately, minority shareholder of Turquoise Hill Resources said they do not support Rio Tinto’s sweetened offer to buy the rest of the Canadian miner for $3.3 billion.
BHP Group and Fortescue Metals Group fell 2.1% and 2.5%, respectively, while Rio dropped to its lowest level since November, 2021.
Gold stocks fell 0.6% to their lowest since October 2018, underpinned by weaker bullion prices.
Australia shares close lower as mining, energy stocks weigh
Financials were among the better performers, with “Big Four” banks adding 0.5%-0.9%.
Building materials maker James Hardie named Aaron Erter as its new chief executive officer. Shares closed up 0.1%.
New Zealand’s benchmark S&P/NZX 50 index closed 0.2% higher at 11,628.25.
The index rose 0.2% over the week.
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