分类： business

Australia’s benchmark stock index has extended its downward trend for a fourth consecutive trading session, as escalating geopolitical tensions between the United States and Iran triggered risk aversion among global and domestic investors, dragging down key mining shares while select sectors managed to eke out gains on Thursday.

The S&P/ASX 200 fell 22.60 points, or 0.26%, to close at 8762.50, while the broader All Ordinaries index dropped 18 points, or 0.20%, to settle at 8961.30. The Australian dollar held steady against the U.S. dollar, ending the trading day at 69.36 U.S. cents.

Against the overall market downturn, eight out of Australia’s 11 major industry sectors closed in positive territory, with energy, consumer staples and technology leading the gains. Energy stocks rallied in lockstep with climbing global crude oil prices, which were lifted by supply disruption fears tied to tensions in the key Strait of Hormuz. Woodside Energy gained 1.49% to $29.30, Santos climbed 2.00% to $7.65, and Ampol rose 1.47% to $35.29. Major domestic supermarket chains also posted solid gains, with Woolworths adding 1.35% to $40.44 and Coles increasing 1.11% to $23.67.

Offsets to these sector gains came from a sharp pullback in material and mining stocks, which were pressured by a dual hit of heightened Middle East conflict and softer-than-expected Chinese economic data. China is the world’s largest importer of iron ore, Australia’s top export, making the sector particularly sensitive to shifts in both Chinese demand and global risk sentiment. Shares in mining giant BHP fell 1.11% to $56.87, Rio Tinto slumped 3.25% to $158.52, and Fortescue Metals Group dropped 1.58% to $18.11, dragging the broader market lower.

The market volatility was triggered by fresh threats from former U.S. President Donald Trump, who pledged “retribution” against Iran following alleged attacks on commercial shipping vessels transiting the Strait of Hormuz, a chokepoint through which roughly a fifth of the world’s oil supplies pass. After a series of exchanged attacks earlier this week, Trump confirmed new U.S. strikes against Iran in a Truth Social post, writing: “This is in retribution for yesterday’s bombing of ships by Iran. If it happens again, it will get much worse!”

Brent crude stabilized at $78 U.S. per barrel after a sharp rally on Wednesday, while West Texas Intermediate added 1% to trade around $74 U.S. per barrel, extending a three-day winning streak for oil prices. Shipping traffic through the Strait of Hormuz remains heavily disrupted, with only a small fraction of normal vessel traffic moving through the waterway, according to market analysts.

Marc Jocum, senior product and investment strategist at Global X, described the current market environment as “geopolitical whiplash” for domestic Australian investors. “One day hopes of de-escalation emerge, the next they disappear. Investors are playing a game of geopolitical whiplash, where optimism at breakfast can turn into panic by dinner as each new headline rewrites the market narrative,” Jocum said. “Renewed U.S. military strikes on Iran for a second straight day, alongside Mr. Trump’s dismissal of a ceasefire as a ‘waste of time’, kept risk appetite firmly on the sidelines.”

In individual company news, insurance broker Steadfast Group gained 0.78% to $5.19 amid ongoing discussions over a $7.7 billion takeover bid led by U.S.-based Amwins Group and investment firm Dragoneer Investments. New Zealand-headquartered building materials firm Fletcher Building jumped 7.55% to $2.99 after upgrading its full-year 2026 earnings guidance, now forecasting earnings before interest and tax of between $400 million and $403 million, including $52 million in revenue from surplus property sales. Commercial construction company FDC Consolidated soared 12% to $3.37 in its debut trading session on the ASX, which opened at 12:30 p.m. local time.

The International Monetary Fund (IMF) has once again downgraded its 2026 global economic growth projection, citing heightened geopolitical uncertainty and rising risks spurred by the resumption of hostilities in the Middle East. In its latest World Economic Outlook update released Wednesday, the fund cut the 2026 global growth forecast to 3.0 percent, down 0.1 percentage points from its April prediction. This marks the second downward adjustment to global growth expectations this year, and represents a gradual cooling of economic expansion from 2025 levels.

Crucially, the revised projections were finalized before recent cross-border military exchanges between the United States and Iran reignited open conflict in the region. Petya Koeva Brooks, deputy director of the IMF’s research department, emphasized that the rapid escalation of tensions overnight underscores the profound uncertainty hanging over the global economic outlook. “We’re going to be monitoring developments very closely,” she told reporters, speaking shortly after former U.S. President Donald Trump announced an end to the temporary U.S.-Iran ceasefire and warned of imminent heavy strikes on Iranian targets.

Inflation projections have also been revised upward, with the IMF now forecasting global inflation will hit 4.7 percent in 2026, higher than earlier estimates. While Koeva Brooks projected that any disruptions from the conflict would normalize gradually over a nine-month period, she warned that sustained shocks pushing up oil prices and unanchoring inflation expectations could cause further damage to global economic activity.

Despite the downgrade, the downward revision remains modest, as booming growth in the artificial intelligence sector has partially offset the economic drag from the Middle East war. The IMF projects global growth will rebound to 3.4 percent in 2027, a recovery Deniz Igan, division chief at the IMF’s research department, describes as a “V-shaped recovery”. Delayed post-conflict normalization, prolonged supply chain disruptions and elevated energy costs are the core factors dragging down 2026 global growth, Igan told Agence France-Presse.

The economic fallout from the conflict varies dramatically across different national economies, the fund notes. Energy-exporting countries outside the active conflict zone benefit from improved terms of trade driven by higher oil prices, while economies integrated into the AI-led technology expansion have recorded stronger activity even if they rely on energy imports. By contrast, energy-importing economies with limited participation in global technology value chains have seen a pronounced slowdown in economic activity.

The current conflict traces back to February 28, when U.S.-Israeli strikes on Iran prompted Tehran to retaliate by effectively blocking traffic through the Strait of Hormuz, the world’s most critical chokepoint for global oil shipments. The closure sent global oil prices soaring, putting immediate pressure on major economies around the world. A temporary U.S-Iran truce later reopened the waterway and resumed oil and gas flows, but hostilities have now reignited.

While the global economy has weathered the conflict’s initial shocks better than many analysts initially feared, the IMF warns the aggregate global outlook masks stark divergence across regions and countries. For example, retail gasoline prices rose 30 percent in emerging Asia after the conflict began, compared to just a 15 percent increase in Latin America. The U.S. economy is still projected to grow 2.3 percent in 2026, but growth for the Middle East and Central Asia region has been cut by 1.2 percentage points to just 0.7 percent. The euro area also saw a downward revision, with 2026 growth now pegged at 0.9 percent; France’s growth forecast was cut 0.3 percentage points to 0.6 percent.

China, the world’s second-largest economy, saw a small upward adjustment to its 2026 growth projection, which now stands at 4.6 percent. Even so, the IMF warns the full economic impact of the renewed conflict has not yet filtered through to global data. The release of strategic petroleum reserves has temporarily eased energy market pressures, but weakening growth remains a distinct possibility going forward. The conflict could also accelerate global trade fragmentation, pushing up prices for key goods across the board.

There are some bright spots amid the gloom, however. Major economies central to global technology supply chains have posted stronger-than-expected performance, even amid their exposure to conflict-related disruptions. The world’s four largest net exporters of AI-related hardware — Taiwan, South Korea, Thailand and Malaysia — have all recorded resilient growth this year. Igan added that the upward revision to 2026 inflation forecasts only represents a temporary pause in the global disinflation trend, rather than a permanent reversal.

Renewed geopolitical upheaval in the Middle East sent shockwaves through global financial markets on Wednesday, after U.S. President Donald Trump announced that a temporary ceasefire with Iran had ended, reigniting investor fears over disrupted energy supplies. The resurgence of tensions traces back to recent Iranian attacks on commercial vessels transiting the Strait of Hormuz, the world’s most critical chokepoint for global oil shipping, which prompted the U.S. to launch new extensive strikes against Iranian targets this week. Washington also moved to revoke a temporary sanctions waiver that had allowed limited exports of Iranian crude, further tightening global energy supplies.

Speaking to reporters on the sidelines of a NATO summit held in Turkey, Trump confirmed the ceasefire was “over” while stopping short of ruling out future diplomatic negotiations. The announcement immediately upended market sentiment that had stabilized in recent days, when oil prices had drifted back down to pre-conflict levels following a period of earlier volatility.

By mid-trading on Wednesday, global energy prices had posted sharp double-digit percentage jumps from their previous closes. The international benchmark Brent North Sea crude climbed more than 5% to peak near $78 per barrel, while U.S. West Texas Intermediate crude also gained 4.6% to settle around $73.65 a barrel. Both benchmarks pulled back slightly in afternoon trading, but still held onto most of their daily gains by the 1350 GMT reporting cutoff.

The spike in geopolitical risk triggered a broad sell-off across equities markets worldwide. On Wall Street, the Dow Jones Industrial Average fell 1.0% to 52,412.15 in early midday trading, while the broad S&P 500 dropped 0.5% and the tech-heavy Nasdaq Composite declined 0.3%. “Trump triggered a sell-off,” noted Sam Stovall, chief market analyst at CFRA Research, summarizing the immediate market reaction.

European markets saw even steeper losses: 90 minutes before closing, France’s CAC 40 and Germany’s DAX were both down 1.8%, while London’s FTSE 100 had shed 1.2%. Asian equities closed the trading day deep in negative territory as well, compounded by existing investor concerns over overinflated valuations and excessive capital spending in the AI technology sector. South Korea’s Kospi, which has been the leading benchmark for the regional AI-driven tech rally, plummeted 5.4% to close at 7,246.79 — falling more than 20% below its record high set just one month prior. Tech giants Samsung and SK hynix both dropped around 6% on Wednesday, extending steep losses from the previous session even after Samsung projected a roughly 19-fold year-on-year jump in second-quarter operating profit fueled by strong AI chip demand.

“Investors have been spooked in recent weeks by fears of excessive spending in the AI world and rich valuations in parts of the tech space, causing widespread profit-taking,” explained Dan Coatsworth, head of markets at British investment firm AJ Bell.

Market analysts warn that the return of open conflict in the Middle East could have long-lasting spillover effects for the global economy. “Geopolitical risks are rising for markets,” said Kathleen Brooks, research director at global trading group XTB. Fawad Razaqzada, a senior market analyst at Forex.com, framed the renewed tensions as an unwelcome development for market participants heading into the summer holiday period. “After a long and eventful first half of the year dominated by the US-Israel war on Iran and Trump’s constant flip-flopping, the last thing investors, and frankly anyone else, needed was a return of the same geopolitical environment,” he said. “Unfortunately, it looks like we could be heading back to that.”

Brooks added that a further escalation that blocks the Strait of Hormuz would send prices even higher: “For the Brent crude oil price to extend gains above $80 per barrel, we would need to see another US naval blockade of the Strait of Hormuz, which would stop Iran from selling its oil and cause a major escalation in tensions.”

The U.S. dollar posted modest gains against most major global currencies on Wednesday, as investors priced in the risk that sustained higher oil prices will keep global inflation elevated longer than previously projected. That outcome would put additional pressure on the U.S. Federal Reserve to implement further interest rate hikes to cool price growth, which typically supports dollar valuations. By 1350 GMT, the dollar rose to 162.49 Japanese yen from 162.09 yen the previous day, while the euro fell to $1.1399 from $1.1415 against the greenback.

Australia’s already critical national housing shortage has deepened after new official data revealed a sharp collapse in new residential construction activity during the first three months of 2024, with industry leaders warning that recent federal budget policy changes will only worsen the sector’s headwinds and delay progress on the country’s ambitious homebuilding targets.

Fresh data published by the Australian Bureau of Statistics (ABS) this week shows that the pace of new home building stalled dramatically in the March quarter, months before the Albanese government unveiled its controversial tax changes for property investors in the May 2024 federal budget. Total new dwelling commencements dropped 11.2% over the quarter to just 48,012 new homes. The sharpest decline was recorded in high-density residential projects, where starts plummeted 19.8% to 19,116 units, while detached single-family home starts fell a more modest 3.5% to 27,658 properties.

While total completed housing projects remain 0.8% higher year-on-year despite the weak first quarter, the latest downturn has pushed Australia even further off track to meet its national Housing Accord target of building 1.2 million new dwellings between 2024 and 2029. To hit this goal, official projections require Australia to average 60,000 new housing starts per quarter — a benchmark the current construction activity is now falling well short of.

Industry economists say the current slowdown has been driven by a perfect storm of interconnected headwinds hitting the construction sector. Master Builders Australia chief economist Shane Garrett explained that rising borrowing costs, global supply chain disruptions linked to the ongoing conflict in the Middle East, soaring building material prices, and persistent skilled labor shortages have combined to drag down home building activity across the country. “Construction demand across housing, non-residential building and civil infrastructure projects have all been squeezed by higher interest rates,” Garrett noted.

The sector now faces additional uncertainty following the tax policy changes introduced in Treasurer Jim Chalmers’ latest federal budget, which was framed as a response to worsening housing affordability stress and rising economic inequality. The budget restructured two key property tax rules to shift investor capital away from existing home sales and toward new construction: it restricted negative gearing tax benefits exclusively to newly built properties, and replaced the longstanding 50% flat discount on capital gains tax (CGT) with an inflation-adjusted indexation system that includes a 30% minimum tax rate.

Master Builders Australia chief executive Denita Wawn warned that the sudden policy shifts have created widespread uncertainty across the industry that will further dampen investment and slow new project development. “The ABS figures show building activity remains below the level needed, and at the same time, builders are telling us that uncertainty created by the federal budget is affecting confidence and slowing investment decisions,” Wawn said.

“This uncertainty means some builders will think twice before proceeding with new projects. In some cases, projects may be delayed, scaled back or not proceed at all. Australia cannot afford policies that make it harder to attract investment into construction when we need to deliver more homes, transport infrastructure, schools, hospitals as well as energy and Olympic projects over the next decade,” she added.

Escalating military tensions between the United States and Iran have sent shockwaves through global commodity markets and rippled into Australia’s domestic sharemarket, leaving the benchmark ASX 200 in negative territory on Wednesday, with sharp divergence across key industry sectors. Fresh military action that began on Tuesday, when U.S. Central Command launched targeted air strikes against Iranian sites along the country’s coastline, has amplified uncertainty in the already volatile Middle East, a region that controls a large share of global oil transit through the critical Strait of Hormuz.

In a public statement posted to the social platform X, U.S. Central Command framed the strikes as a response to recent Iranian attacks on commercial shipping vessels carrying civilian crews in international waters, noting the operation was designed to impose clear costs for Tehran’s actions. A senior U.S. official confirmed Iran launched retaliatory strikes following the initial U.S. assault, creating a dangerous cycle of tit-for-tat violence that threatens regional stability.

The escalation immediately impacted global energy markets, pushing Brent Crude prices up to a two-week high of $76.58 per barrel. This sharp uptick in oil prices triggered mixed reactions across Australia’s benchmark index, which ended the trading session in the red despite a partial recovery from a deeper morning slump. The ASX 200 closed 18.80 points lower, a 0.21% drop that landed it at 8785.10, while the broader All Ordinaries index fell 25.40 points, or 0.28%, to settle at 8979.30. Against the U.S. dollar, the Australian dollar rallied to 69.36 U.S. cents by market close.

Against the overall market downturn, six of the ASX 200’s 11 industry sectors closed in positive territory, led by energy stocks that benefited directly from the rising crude prices. Major Australian energy producers posted double-digit and solid single-digit gains: Woodside Energy rose 3.22% to close at $28.87, Santos climbed 5.78% to $7.50, and fuel retailer Ampol gained 1.37% to finish at $34.78. Consumer staples were another bright spot for the market: supermarket chain Woolworths rose 1.22% to $39.90, rival Coles added 0.39% to $23.41, and drinks and hospitality operator Endeavour Group jumped 1.79% to $3.51.

These sector gains were more than offset by steep declines across mining and materials stocks, driven by falling commodity prices and investor jitters over prolonged high global interest rates. BHP Group shares fell 2.31% to $57.51, Rio Tinto dropped 2.55% to $163.85, and only Fortescue Metals bucked the trend with a tiny 0.11% gain to $18.40. Gold mining stocks also slumped as rising oil prices stoked fears that central banks would keep interest rates higher for longer, a trend that typically weighs on non-yielding assets like gold. Northern Star Resources fell 1.69% to $20.31, Evolution Mining dropped 4.19% to $11.44, and Newmont lost 1.04% to $136.18.

Tony Sycamore, senior market analyst at IG, explained that the latest conflict grows out of a long-standing unresolved dispute over sovereignty of the Strait of Hormuz, a chokepoint through which roughly 20% of global oil supplies pass each day. “Iran maintains that parts of the Strait fall within its territorial waters and that it exercises sovereignty over them, while the US position was that the Strait is an international waterway with rights of transit passage for all nations,” Sycamore said. “This fundamental difference in interpretation was never fully resolved in the text of any agreement.”

Beyond the geopolitical-driven volatility, several individual companies dragged on the index through company-specific events. Telecom giant Telstra saw its shares drop 2.96% to $4.92 following a nationwide network outage that disrupted more than 24.9 million mobile services, interrupted business payment systems, and shut down public transport networks across multiple Australian states. Furniture retailer Adairs fell 1.34% to $1.47 after it flagged a non-cash impairment charge of up to $60 million and projected a statutory after-tax net loss of roughly $43 million. Medical device company ResMed slipped 0.80% to $31.19 after announcing it had agreed to sell its MatrixCare software business to Frazer Healthcare Partners for $490 million U.S.

As Australia’s central bank holds the official cash rate steady, a wave of independent rate cuts from domestic lenders has upended the country’s mortgage market, driven by intensifying competition to win over home loan borrowers. In an unexpected shift that defies the Reserve Bank of Australia’s (RBA) June decision to keep the cash rate at 4.35%, 18 lenders have moved to slash variable home loan interest rates for existing and prospective customers, with several more cutting fixed rate offerings.

Data from finance comparison platform Canbar shines a light on the core dynamic driving this unconventional move: cutthroat price competition forcing providers to undercut one another to gain market share. “Competition among lenders continues to create opportunities for some households to cut their borrowing costs,” noted Sally Tindall, Canstar’s director of data insights. Tindall added that while negotiating a lower rate with a current lender can deliver modest savings, the largest reductions still typically come from refinancing a home loan with a new provider.

The most prominent cut highlighted by Tindall came from Bendigo Bank, which reduced its lowest variable rate for refinancing customers by 15 basis points, bringing the rate down to 5.89%. Following this round of cuts, 15 separate lenders now offer home loan rates below 5.9% — a threshold that was far less common just months earlier. Fixed rate home loans have also seen downward movement, with five lenders rolling out reduced fixed rate terms for new borrowers. AMP Bank led the fixed rate cuts, trimming some of its long-term fixed rates by as much as 50 basis points.

This wave of private sector rate cuts comes even as the RBA opted to hold the official cash rate at its June monetary policy meeting, with the board voting unanimously to keep rates steady despite inflation remaining well above the central bank’s 2-3% target. Recent official data from the Australian Bureau of Statistics puts annual headline inflation at 4.0% as of May, down slightly from 4.2% in April. The cooling of headline inflation is largely attributed to the Australian government’s temporary fuel excise halving, which drove an 11.9% drop in automotive fuel prices in May following a 7.0% decline in April.

However, core inflation — the RBA’s preferred indicator that strips out volatile price movements for items like fuel — tells a less encouraging story. The trimmed mean inflation rate rose 0.4% month-on-month in May, accelerating from a 0.3% increase in April, pushing the annual core rate to 3.6%. RBA governor Michele Bullock emphasized after the June rate decision that inflation remains unacceptably high, and left the door open for future rate hikes if necessary. “I want to be very clear that inflation remains too high,” Bullock said. “Rate hikes remained on the table if that is what is required to bring inflation down.”

The conflicting signals from inflation data have split economic experts over the RBA’s next policy moves, with forecasters divided between expecting extended rate holds, gradual cuts, and additional hikes to curb persistent price growth. HSBC chief economist Paul Bloxham expects the RBA will hold rates steady for a prolonged period, in large part due to a cooling housing market that is already expected to dampen consumer spending and ease inflationary pressure. “Although the RBA does not target housing prices, the housing price correction will have implications for monetary policy,” Bloxham explained. HSBC’s base case forecasts housing prices to decline in the second half of 2026, and fall 2-6% over the full 2027 calendar year. “At some level, the cooling housing market will be helpful for the RBA if it slows down consumer spending, as this will also help to take some more pressure off inflation, which is too high,” he added.

Three of Australia’s four largest major banks also predict rates will remain on hold until 2027, with only subtle differences in their outlooks. Commonwealth Bank projects the RBA will hold rates steady through the rest of 2026, though it acknowledges rates could rise if inflation continues to exceed forecasts. National Australia Bank expects the RBA to hold before starting gradual rate cuts in the second quarter of 2027, while Australia and New Zealand Banking Group forecasts two rate cuts will be implemented over 2027.

Westpac, the only major bank to break ranks, is forecasting two more 25-basis-point rate hikes before the RBA pauses for a 12-month period. Westpac chief economist Luci Ellis argues that persistent above-target inflation makes additional rate increases likely before the end of the year. “We still regard our two-hike track as the most appropriate base case view, given the inflation outlook,” Dr Ellis said in comments late last week. Ellis pointed to two key factors that could keep inflation higher than policymakers expect: lingering pass-through effects from recent fuel price increases to other consumer goods and services, and a larger-than-expected increase in minimum and award wages that could put upward pressure on broader labor costs. “If we are right about the inflation profile from here, the RBA will be surprised on the upside,” she added. “We therefore retain our view that further rate hikes will occur in the following meetings (in August and September).”