The Australian sharemarket fell to a four-month low on Thursday, as escalating attacks on Middle Eastern energy infrastructure pushed oil prices higher and reinforced expectations that interest rates may remain elevated.
The S&P/ASX 200 dropped 142.8 points, or 1.7%, to close at 8,497.8, with eight of the 11 sectors finishing in negative territory.
Losses were led by the materials sector, as gold prices weakened overnight, as the United States Federal Reserve held interest rates steady.
The precious metal staged a modest recovery during Asian trading, rising 0.9% to US$4,859 per ounce.
Gold miners were among the worst performers. Northern Star Resources fell 8%, Evolution Mining dropped 8.6%, and Newmont declined 5%.
Major diversified miners also retreated, with BHP Group down 3.5%, Rio Tinto falling 3.2%, and Fortescue losing 3.4%.
The Information Technology sector came under pressure as well, with WiseTech Global sliding 7%, Xero down 3%, TechnologyOne falling 0.7%, and NextDC declining 2.4%.
In contrast, energy stocks rallied strongly as oil prices surged amid heightened geopolitical tensions involving Iran and Israel. Brent crude rose 4.5% to $112.21 per barrel during Asian trading, extending gains from the previous session.
The Energy sector climbed 4.8%, with Santos up 3.2%, Beach Energy gaining 4.1%, and Viva Energy surging 15.2%.
Woodside Energy rose 6.4% after announcing the appointment of former Anglo American chief executive Mark Cutifani as a director.
Coal producers also benefited from the tightening energy outlook, with Whitehaven Coal up 2.3%, Yancoal Australia gaining 6.8%, and New Hope Corporation rising 5.3%.
In corporate developments, Lynas Rare Earths fell 2.1% despite announcing the first production of samarium oxide at its Malaysian processing facility, expanding its heavy rare earths portfolio.
Boss Energy also dropped 6.8% despite increasing uranium resources at its Gould’s Dam and Jason’s satellite deposits in South Australia.
On the macroeconomic front, data showed Australia’s unemployment rate rose more than expected to 4.3% in February as the participation rate increased. Employment grew by 48,900 positions, exceeding forecasts of 20,000.
Bond markets also reflected shifting expectations for interest rates, with yields rising. The 10-year government bond yield increased 0.8% to 4.982%, while the 2-year yield climbed 0.9% to 4.627%.
