The ASX200 index recorded a decline of 55.2 points, or roughly 0.67%, culminating at a closing value of 8,150. The broader All Ordinaries index saw a comparable drop of 57.7 points, marking a 0.68% decrease, to close at 8,416.6.
The market's descent was widespread with nine out of eleven industry sectors experiencing losses. The materials sector was particularly affected and observed the steepest decline of 1.18%.
Major players in mining saw downturns despite steady Singapore iron ore prices at US$109 per tonne. BHP shares fell by 1.74% to $44.58, with Rio Tinto and Fortescue also suffering losses of 1.87% and 1.1% respectively.
StoneX analyst David Scutt noted potential technical factors influencing the pullback in the materials sector. He pointed towards shifts in capital flows as investors strategically realign exposure between China and regional markets such as the Nikkei.
The financial sector wasn't immune to the pressure, dropping by 1.04%.
Commonwealth Bank's share price decreased by 1.39% to $132.74, NAB by 1.54% to $36.43, and Westpac suffering a slump of 1.86% to $30.14. ANZ also fell by 1.46% to $29.64, following an $85m settlement linked to its previous car loans operations, with no liability being admitted by ANZ.
Scutt commented on the sector’s stretched valuations as a persistent issue being kept in play.
Energy shares, however, were buoyant as oil prices jumped beyond 5%. This surge followed news of potential geopolitical tensions involving Israel and oilfields in Iran. Consequently, Australia’s energy stocks rose, with Woodside Energy climbing by 2.23% to $26.64, Santos growing 2.1% to $7.30, and Beach Energy lifting by 1.2% to $1.27. Notably, Strike Energy leapt by 9.52% to 23 cents.
IG markets analyst Tony Sycamore remarked on the fluid nature of geopolitical conditions, suggesting that while oil facilities might remain untouched initially, the market remains wary of potential disruptions.
Friday's downtrend followed a shaky session on Wall Street the previous night, with Dow Jones losing 184 points and the Nasdaq remaining mostly unchanged.
Upcoming U.S. non-farm payroll figures are anticipated to guide some areas of global financial markets. According to Scutt, this report could have a substantial effect on market tendencies moving forward.
Among the top gainers on ASX200 was poker machine manufacturer Light and Wonder, ascending by 7.78% to $140.69. Conversely, an adverse market move hit lithium mining company Liontown Resources, ending the day down by 3.89% to 74 cents.
Finally, the Australian dollar saw a modest uptick, rising 0.09% to purchase US68.4c, rounding off the day’s financial activities.
