Australian shares edged down today, on track to snap a five-session rally, as renewed tensions in the Middle East weakened investor sentiment.
This follows reports that an Iranian parliamentary committee was reviewing draft legislation that would prevent US, Israeli and other “hostile” vessels from transiting the Strait of Hormuz.
The flare-up in tensions threatens to halt the ASX’s recent rally.
The benchmark logged record highs twice this week on optimism over a potential US-Iran deal, fading expectations of near-term rate hikes in Australia and its relative insulation from the AI-related swings that have rattled global markets.
The ASX 200 fell 0.3% to 9,243 as of 12:10pm AEST. The benchmark was nevertheless set to close the week around 2.8% higher.
Financial stocks fell 0.9%, and were set for their worst day since July 1.
NAB lost 1.4%, leading the decline, followed by CBA and Westpac, both down 1.3%, and then ANZ dropped 0.9%.
Still, the sector remained up more than 1% for the week.
Healthcare stocks fell 1.2%, while consumer staples and discretionary stocks slipped over 0.5% each.
The materials sector gained 0.3%, as fibre cement maker James Hardie surged as much as 5.4% to hit a near one-year high. The company reported a 54% jump in its first-quarter adjusted net income while also raising its annual earnings forecast.
Critical mineral producers PLS and Mineral Resources added 5.4% and 1.6%, respectively.
The sector was on track for a more than 6% gain for the week, set for its best week since early April.
Energy stocks tracked the rise in global oil prices higher, adding 0.9%.
Reporting with Reuters