The Australian sharemarket dropped like a stone after an unexpectedly strong jobs reports dampened hopes of another rate cut by the Reserve Bank of Australia next year.

The S&P/ASX 200 index tumbled as much as 1 per cent to a 10-week low after the unemployment rate fell more than expected to 4.3 per cent in October from 4.5 per cent. The employment number also surprised as Australia added 42,200 jobs.

By 12:42pm AEDT, the index was down 84.7 points to 8714.7 led by heavy selling in the rate sensitive technology and property sectors. Before the jobs report, the index was only down 0.2 per cent.

Refusing to cool

Money markets further reduced the probability of a June reduction in interest rates to 50 per cent, from 80 per cent last week.

“A labour market that refuses to cool gives the RBA no reason to cut again soon,” said eToro market analyst Farhan Badami said. “I don’t think governor Michele Bullock will risk reigniting it with premature easing.”

Financials weighed as ANZ extended losses, falling 4.8 per cent, as the shares trad ex-dividend. Westpac lost 2 per cent and National Australia Bank 1.2 per cent. Commonwealth Bank rose 0.5 per cent after recent selling.

But technology stocks was the hardest hit. Xero tumbled 6 per cent after the ASX-listed accounting software company’s operating expenses ratio came in above expectations. NextDC fell 2.9 per cent and WiseTech 0.9 per cent.

Property stocks were also sold off, with major developers from Mirvac to Stockland and Charter Hall down more than 3 per cent.

The energy sector also weighed after a near 4 per cent decline in crude oil overnight after OPEC said global crude supplies surpassed demand sooner than anticipated. Woodside fell 2.9 per cent and Santos by 2.1 per cent.

One bright spot on the bourse was health care, as investors rotated into some of the more defensive stocks. CSL, Sonic Healthcare and Pro Medicus were all up around 1 per cent.

Materials were also higher s gold prices traded near $US4200 an ounce. This helped Newmont rally 3.4 per cen and Evolution Mining 2.7 per cent.

Regis Resources soared 5.3 per cent on news it has extended the life of its Duketon North operation as the gold miner cashes in on the buoyant gold prices.

Stocks in focus

In company news, DroneShield tanked 30.3 per cent after chief executive Oleg Vornik sold nearly 15 million shares in the company valued at $49.5 million. Chairman Peter James sold $12.35 million as well.

GrainCorp plunged 10.3 per cent as it reported a 35 per cent fall in net profit to $40 million for the 2025 fiscal year, as softer international grain margins offset strong volumes on Australia’s east coast.

Orica rallied 2.7 per cent as it reported its strongest earnings in 13 years, with full year net profit up 32 per cent to $541 million.

Sandfire Resources fell 1.6 per cent as it agreed to acquire up to an 80 per cent stake in Havilah Resources’ Kalkaroo copper-gold project in South Australia. The latter’s shares rocketed 27.8 per cent.

Webjet Group tumbled 21 per cent after a profit warning. The company full-year earnings would be between $30 million to $32 million, down as much as 14 per cent from the year earlier on weak demand. The forecast was 17 per cent off analyst expectations.