Australian shares ended lower on Friday dragged by losses in miners and banks, while investors kept a cautious stance amid fears of looming recession and little signs of the US Federal Reserve slowing its pace of interest rate hikes.
The S&P/ASX 200 closed 0.8% lower at 6,762.80, although the benchmark gained 4.5% for the week, marking its best since early October 2020.
“The ASX this week is bolstered by RBA’s (Reserve Bank of Australia) pivot to opt for a smaller-size hike which I expect will set up the theme for the central bank’s future move,” said Hebe Chen, a market analyst at IG Markets.
Investors are now looking for US monthly nonfarm payrolls numbers due later in the day for signs of the Fed’s policy tightening path.
Only a very large miss on the nonfarm payrolls figure may change the near-term view of higher rates and weaker growth, said Kerry Craig, global market strategist at J.P. Morgan. Financials dropped 0.7%.
However, the sub-index advanced 5.2% this week, recording its best in more than six months after the RBA’s softer than expected 25 basis points rate hike to tame inflation.
The “Big Four” banks fell between 0.3% and 0.5%.
Miners slipped 1.2% in their worst session in over a week, but the sub-index posted a 5.1% gain this week.
Australian shares close flat as two-day rally fizzles out
BHP Group , Rio Tinto and Fortescue Metals declined between 1.4% and 1.7% on Friday.
Meanwhile, energy stocks rose 1% leading to a 10.2% jump for the week, its best since November 2020, on the back of strong crude prices.
Woodside Energy and Santos added 0.2% and 1.9%, respectively. Separately, RBA flagged risks to financial stability that have increased over recent months as interest rates rose, mounting pressure on Australian household budgets, while housing prices declined.
In New Zealand, the benchmark S&P/NZX 50 closed 0.2% lower at 11,103.79.
For the week, it rose 0.3%, snapping three straight weeks of losses.
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