Australian shares inched down in early trade on Thursday, with marginal losses in local mining and financial stocks, while risks of persisting inflation dashed hopes for early interest rate cuts from the country’s central bank.
The S&P/ASX 200 index fell 0.1% to 7,762.70 by 00:09 GMT.
The benchmark closed down 0.1% on Wednesday.
The Reserve Bank of Australia kept rates at a 12-year high of 4.35% on Tuesday, over persistent woes of sticky inflation as it remains well above the central bank’s target band.
Markets remained gloomy about prospects of rate cuts in the year, with traders now expecting a possible cut only by early 2025. Rate-sensitive financial stocks were the biggest laggard on the benchmark index, falling 0.2%.
The “Big Four” banks fell between 0.1% and 0.3%.
Domestic mining stocks fell 0.2%, tracking weakness in iron ore prices over potential steel production cuts in China, Australia’s largest trading partner. Mining behemoths BHP Group, Rio Tinto and Fortescue fell between 0.1% and 0.4%.
The energy sub-index slipped 0.1% as well, in tandem with falling oil prices over war jitters in the Middle East.
Sector giant Woodside Energy dropped 0.4%, while smaller rival Santos fell 0.1%.
Australian shares hit record high; RBA cautious on inflation
In company news, Namoi Cotton dropped as much as 7.2%, after Australia’s competition watchdog raised concerns over its proposed acquisition by Singapore’s Olam Agri in cotton ginning services.
Treasury Wine Estates was also down as much as 1.9%, after the winemaker’s fiscal 2024 EBIT forecasts for its Penfolds segment missed analyst expectations.
Across the Tasman Sea, New Zealand’s benchmark S&P/NZX 50 index remained largely unchanged, edging up 0.02% to 11,673.63.
Official data released on Thursday showed the country’s gross domestic product rose 0.2% in the March quarter, beating analysts average forecast of 0.1% growth.
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