Australian shares hit 1-month low as banks drag on budget reforms; CBA drops on profit miss
- S&P/ASX 200 index fell 0.5% to 8,631.8
Australian shares edged down on Wednesday, as bank stocks hit a near six-month low, hit by housing tax changes in the federal budget, with top lender CBA tumbling more than 8% after the lender increased its provisions due to the Middle East conflict.
The S&P/ASX 200 index fell 0.5% to 8,631.8 by 0115 GMT. The benchmark was eyeing its fourth session of losses. In a move to improve affordability, the Federal Budget on Tuesday proposed major property tax changes, limiting negative gearing to new builds and replacing the capital gains tax discount with inflation indexation.
UBS analysts view the changes as slightly negative for overall mortgage growth due to the loss of tax incentives for investor mortgages.
Financials were leading declines on the bourse, falling 3.5%, on track for their worst one-day fall since early April 2025, while hitting their lowest level since December 5. Australia’s top lender by market value, CBA fell as much as 9%, tracking its worst trading session since mid-March 2020.
The firm ordered a A$200 million ($144.70 million) increase in its provisions to prepare for the fallout from the Middle East conflict, while its quarterly cash profit came in 2% below Citi estimates.
All the other ‘Big-Four’ banks suffered losses between 1% and 2.3%.
Real estate stocks slipped as much as 0.6% before paring some losses.
Technology stocks dipped 1.3% tracking peer Nasdaq’s move on Wall Street.
Meanwhile, Miners firmed 2.1%, with heavyweights Rio Tinto and BHP hitting new record highs during the session. The sub-index hit its highest level since early March.
Gold stocks added 1.4% even as bullion prices eased overnight
In New Zealand, the benchmark S&P/NZX 50 index weakened 0.3% to 13,042.85.
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