Australian shares were muted on Thursday, slipping from a record peak hit in the previous session as losses in banks weighed, while investors remained cautious awaiting policy decisions from the central banks in Australia and the U.S. in the near term.
The S&P/ASX 200 index edged 0.02% lower to 8,841.70, as of 0053 GMT. The benchmark ended at a record closing level of 8,843.70 on Wednesday, after hitting an all-time high of 8,848.80 earlier in the session.
Investors are betting on interest rate cuts by the Reserve Bank of Australia next week and the U.S. Federal Reserve in September respectively, with swaps pricing in more than 92% odds of a quarter-point rate reduction by the RBA on August 12.
Analysts at Morgan Stanley expect the commentary at this meeting will be consistent with their forecast for continued easing towards more neutral settings.
On the local bourse, financials fell 0.1%, with three of the country’s “Big Four” banks declining between 0.1% and 0.5%.
Among these major lenders, Commonwealth Bank of Australia and Westpac are set to report their annual and third-quarter earnings, respectively, next week.
Meanwhile, AMP fell 2.4% as the money manager’s interim earnings missed estimates.
Miners rose 0.2%, while gold stocks gained 1.4%.
Across the Tasman Sea, New Zealand’s benchmark S&P/NZX 50 index was largely unchanged at 12,878.46.
Analysts at Westpac echoed the larger market sentiment of expectations of a 25-basis-point rate cut from the Reserve Bank of New Zealand at their August policy meeting.
“It’s unlikely that the RBNZ will call time on the easing cycle just yet as the economy is yet to decisively and sustainably turn,” they added.
The RBNZ is set to announce its cash rate decision on August 20.
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