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Australian shares appeared poised to end a 10-session winning streak on Friday, weighed down by declines in local mining stocks, as investors exercised caution ahead of upcoming domestic inflation data and a wave of corporate earnings reports that could influence the Reserve Bank of Australia's (RBA) monetary policy decisions.
The S&P/ASX 200 index slipped 0.3% to 8,002.2 at the time of writing on 23 August 2024, after a modest 0.2% gain in the previous session. For the week, the index is also down 0.3%.
The RBA has indicated that near-term interest rate cuts are unlikely, suggesting that restrictive monetary policy may need to remain in place for an "extended period" to ensure inflation is brought under control. Despite this stance, traders are betting on an 84% chance that the RBA will cut rates by the end of the year.
The Australian dollar weakened by 0.13% against the U.S. dollar, trading at AU$0.67.
Mining stocks were the biggest decliners on the benchmark index, falling around 1% amid a broad-based pullback. However, the mining sub-index remained up by more than 3% for the week. Heavyweights BHP Group, Rio Tinto, and Fortescue Metals were all down between 0.7% and 1.3%.
Financials struggled for direction, with the sector trading within a narrow range after early losses. Among the "Big Four" banks, ANZ Group dropped 0.8% following a decision by Australia’s prudential regulator to increase the capital add-on requirement for the lender to AU$750 million, citing ongoing concerns over ANZ's risk management practices.
On Wall Street, the S&P 500 index remained mostly unchanged overnight, while the Nasdaq lost 1.67%. Meanwhile, S&P 500 E-mini futures inched up 0.2% after a 0.28% decline from the close.
In New Zealand, the benchmark S&P/NZX 50 index managed to recover from early losses, edging up 0.3% to 12,512.68.
