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Highlights
- ASX drops 1.7%, with all sectors in the red.
- Mining and banking stocks face significant declines.
- Mineral Resources and Viva Energy see sharp losses.
The Australian sharemarket saw a significant drop on Tuesday, with the S&P/ASX 200 Index declining by 1.7%, closing at 8205.7 points. This marks the sharpest decline in over six weeks, following a period of strong market performance. All 11 sectors ended the day in negative territory, reflecting a broad market pullback influenced by shifting expectations around interest rates.
The All Ordinaries Index also fell by 1.6%, as investors adjusted to the likelihood of interest rate cuts being pushed back into the middle of next year. This shift came after a rise in bond yields, both in Australia and the US, which signaled a potential "higher-for-longer" interest rate environment. Sectors sensitive to interest rates, such as property and banking, experienced notable losses during the trading session.
Sector Performance Overview
Property stocks were among the hardest hit, with Goodman Group (ASX:GMG) leading the sector’s decline, falling by 2.7% to close at AUD 36.07. The banking sector also experienced a significant downturn, with Commonwealth Bank (ASX:CBA) dropping by 2.2% to AUD 141.23, along with similar losses for the other major Australian banks.
Mining giants followed suit, impacted by a drop in iron ore prices in Singapore. BHP Group (ASX:BHP) declined by 1.2% to AUD 42.14, while Fortescue Metals (ASX:FMG) dropped 1.6% to AUD 19.53. These declines contributed to the overall market weakness, with the resource-heavy Australian market particularly vulnerable to fluctuations in commodity prices.
Stocks in Focus
Mineral Resources (ASX:MIN) extended its losses on Tuesday, dropping by 4.3% to AUD 37.87, following a significant 10% decline on Monday. This followed an investigation by the Australian Financial Review, which revealed potential tax issues involving the company’s managing director, Chris Ellison.
Meanwhile, Viva Energy (ASX:VEA) saw a sharp decline of 6.7%, falling to AUD 2.66. The company reported challenges in the retail sector, including lower tobacco sales and rising business costs, which weighed heavily on its stock performance.
On the tech side, WiseTech Global (ASX:WTC) rebounded 2.8% to AUD 107.62 after a volatile session. The company had seen its shares slump nearly 15% on Monday after news broke that founder Richard White had been selling shares due to personal financial obligations.
Transurban (ASX:TCL), the toll road operator, also experienced a 1.6% decline, closing at AUD 13.05, despite reaffirming its FY25 distribution guidance of 65¢ per share. The company reported growth in daily traffic across most of its markets, with Melbourne being the only exception.
Lastly, Audinate Group (ASX:AD8), a software provider, fell by 6.1% to AUD 8.96 after warning that it may not meet its full-year gross profit target. The company cited ongoing challenges expected to extend into the next quarter.
Despite the broad declines, the Australian sharemarket continues to adjust to the evolving global economic landscape, with bond yields and interest rate expectations playing a central role in market dynamics.
