Australian share market declines as ASX 200 drops 0.47% driven by losses in tech and energy stocks
Updated: Sep 4
Australian shares closed lower on Wednesday as investors moved to reduce risk ahead of crucial US inflation data, with losses across technology, industrial and energy stocks dragging the benchmark index to its lowest close in nearly three weeks.
The S&P/ASX 200 fell 0.47% to 8,353.6 points on 11th December 2024, extending losses for a second consecutive session as weakness on Wall Street and uncertainty over the Federal Reserve’s interest-rate outlook weighed on sentiment.
Technology stocks were among the weakest performers, with the sector falling around 1.4%, while industrials lost just over 1%. Energy shares also declined by approximately 1%, with Woodside Energy falling 0.8% and Santos dropping 1.4%. Financial stocks slipped around 0.6%, adding further pressure to the broader market.
IG market analyst Tony Sycamore said, "Today’s decline followed a cautious trading session on Wall Street overnight, where investors moved to the sidelines ahead of critical U.S. inflation report."
Investors were awaiting US consumer price inflation figures, one of the final major economic releases before the Federal Reserve’s December policy meeting. The report was expected to provide further clues about the trajectory of US interest rates and the likelihood of additional monetary easing.
Attention was also turning to Australian employment figures following the Reserve Bank of Australia’s decision to hold its cash rate at 4.35%, while softening some of its previous hawkish language.
Sycamore said, "A weaker-than-expected employment report would strengthen expectations for an earlier RBA rate cut". He added, "Market sentiment today is already leaning towards this possibility, with current pricing indicating a 63% probability of a February rate cut, up from 54% on Tuesday."
With both US inflation and Australian labour-market data in focus, investors remained cautious as expectations for global monetary policy continued to drive equity-market sentiment.