Australian shares closed lower on Wednesday, extending losses into a fourth consecutive session as investors assessed the Federal Budget and reacted sharply to a disappointing quarterly update from Commonwealth Bank.
The S&P/ASX 200 fell 40.3 points, or 0.5%, to 8,630.4, despite 10 of the index’s 11 sectors finishing in positive territory.
The Financial sector weighed heavily on the benchmark after Commonwealth Bank slumped 10.4%, marking its largest daily decline since March 2020.
Investors responded negatively to signs of slowing growth, rising loan arrears and federal budget measures affecting property investment.
The bank reported an unaudited quarterly cash profit of about A$2.7 billion, down 1% from the average quarterly profit recorded in the first half, although up 4% from the prior corresponding period (pcp).
Loan impairment expenses totalled $316 million for the quarter, while the bank increased the forward-looking component of its collective provisions by $200 million.
Management said the adjustment reflected revised macroeconomic forecasts and a higher weighting assigned to downside economic scenarios.
Broader concerns surrounding the Federal Budget also affected sentiment toward the major banks after the government unveiled changes to capital gains taxation and negative gearing arrangements on investment properties.
Among the other major lenders, Westpac fell 2.8%, National Australia Bank declined 1.5%, and ANZ dropped 1.6%.
The Consumer Discretionary sector led gains on the index, driven by a sharp rally in Aristocrat Leisure, which surged 13.3% after reporting a 9.1% increase in first-half profit and expanding its share buyback program by $1 billion.
Mining stocks also supported the market, with BHP rising 2.9% and Rio Tinto gaining 1.9%, both reaching fresh record highs, while Fortescue also climbed 2.8%.
In company news, online furniture retailer Temple & Webster fell 6.4% despite reporting what it described as the “most profitable April in the company’s history”.
The company forecast FY2026 revenue of between $665 million and $675 million, representing annual growth of between 11% and 12%.
FY2026 EBITDA is expected to range between $20 million and $22 million, an increase of 6% to 17% over the pcp.
However, RBC Capital Markets analyst Wei-Weng Chen said the guidance disappointed investors.
Chen said the company’s FY2026 revenue guidance was 6% below market consensus, while EBITDA guidance missed expectations by 30%.
Mining services company Perenti jumped 8.4% after Bellevue Gold awarded an $850 million underground mining contract to its subsidiary Barminco for work at the Bellevue gold mine in Western Australia.
Bellevue Gold shares slipped 0.6%.
Economic data released during the session showed that Australian the value of new housing loan commitments fell 3.8% quarter-on-quarter in the first quarter of 2026.
Australian Bureau of Statistics (ABS) head of finance statistics Mish Tan said higher interest rates had contributed to weaker lending activity.
‘Falls were recorded across all borrower types this quarter, following strong growth throughout 2025 and cash rate rises in February and March.’
‘Despite this quarter’s fall, lending activity remains at high levels, with total new home loans 8.6 per cent higher than a year ago.’
Meanwhile, the seasonally adjusted Wage Price Index rose 0.8% during the March quarter, with annual wage growth coming in at 3.3%.
The private sector recorded quarterly wage growth of 0.8%, while the public sector increased 0.5%.
ABS head of prices statistics Sue-Ellen Luke said wage growth remained broadly stable.
‘Quarterly wage growth has remained steady at 0.8 per cent since September quarter 2025. Annual growth in wages was 3.3 per cent, largely unchanged from 3.4 per cent in December quarter 2025.’
On the bond markets, Australian 10-year government bond yields fell 0.5% to 5.065%, while two-year yields declined 0.7% to 4.739%.
