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Highlights
- Australian sharemarket slides as all sectors retreat.
- Mining and technology sectors lead significant losses.
- Australian dollar hits two-year low against the US dollar.
The Australian sharemarket experienced a sharp decline on Thursday, influenced by a Wall Street downturn following signals from the US Federal Reserve regarding fewer interest rate cuts in 2025 than previously anticipated. The S&P/ASX 200 dropped to 8137.2 points by mid-morning, reflecting a fall across all sectors, while the Australian dollar slid to a two-year low of 62.08 US cents.
Mining Sector Declines
The materials sector saw notable losses as key players reported declines. Iron ore companies like (ASX:FMG) fell over three percent, while (ASX:BHP) and (ASX:RIO) both shed nearly two percent. Gold miners faced even steeper declines; (ASX:NEM) dropped over three percent, and (ASX:NST) recorded a fall exceeding five percent as global gold prices hit a one-month low. Lower interest rates generally support bullion, but the current economic uncertainty has dampened sentiment.
Financial Stocks Under Pressure
Major Australian banks also recorded losses during Thursday trading. (ASX:ANZ) suffered the largest dip among the big four banks, while (ASX:CBA), (ASX:NAB), and (ASX:WBC) each saw declines exceeding two percent. Financial services providers (ASX:QBE) and (ASX:SUN) also experienced reduced value.
Technology and Energy Stocks Hit Hard
The information technology sector endured the steepest losses, mirroring Wall Street's trends. (ASX:WTC) fell significantly, losing over four percent, with (ASX:XRO) and (ASX:TNE) both posting declines exceeding three percent. The energy sector also faced challenges as (ASX:WDS) and (ASX:STO) fell, accompanied by losses from coal companies like (ASX:WHC) and (ASX:YAL). Meanwhile, (ASX:DYL) reported an 11.9 percent drop following delays in decisions for its Tumas uranium project in Namibia.
Global Factors Impacting Markets
Wall Street's downturn overnight added to the pressure on Australian markets. The US Federal Reserve's indication of reduced rate cuts for 2025, combined with rising Treasury yields, weighed on investor sentiment. Major US indices, including the S&P 500, Dow Jones, and Nasdaq, recorded substantial losses.
The Australian market's struggles underscore global economic concerns as uncertainty over future interest rate decisions continues to influence stock and currency markets. The outlook remains cautious, with sectors across the board reacting to shifting monetary policies and broader global economic dynamics.
