SYDNEY: Australian shares gave up early gains to end lower on Thursday, hit by broad-based losses, as risk appetite faded after US President Donald Trump vowed more aggressive strikes on Iran and gave no concrete timeline for ending the war.
The benchmark S&P/ASX 200 index closed down 1.1 percent - its biggest daily decline since March 19 - at 8,579.5 points. However, the index logged a 0.7 percent gain for the holiday-shortened week
Global stocks fell and oil prices jumped as Trump’s comments shattered expectations for a swift end to the Middle East conflict, which has disrupted energy supplies and threatened to tip the world economy into a tailspin.
“Trump’s latest comments have eroded the fragile hope for a near-term de-escalation, prompting a clear recalibration in risk sentiment,” said Hebe Chen, market analyst at Vantage Markets.
“This is not a full risk-off capitulation, but a loss of conviction; investors are becoming more selective, with sensitivity to headlines rising again across all asset groups.”
Sectors across the Australian bourse reversed gains shortly after Trump’s prime-time address.
Miners lost 2.9 percent, logging their lowest close in three weeks.
Mining giants Rio Tinto and BHP shed 3.3 percent and 2.5 percent, respectively. Gold miners logged their worst fall of 3.6 percent in over a week. The sub-index rose as much as 3.1 percent earlier in the day.
“A gloomier growth outlook is weighing on the materials sector, while gold miners have been hit again by another rise in yields and the US dollar,” said Kyle Rodda, senior financial market analyst at Capital.com.
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