Australian stocks experienced a slight downturn on Friday, influenced by declines in major financial and mining sectors, as cautious investors responded to stronger-than-anticipated local job data, which raised concerns about potential delays in interest rate cuts. The S&P/ASX 200 index slipped by 0.24% to 7,763 points at 3:58 PM AEDT. Despite this, the benchmark index was poised to record its strongest weekly performance since early February.
Local job data released by ABS
Data released by the Australian Bureau of Statistics on Thursday revealed a significant rebound in net employment figures last month compared to January, marking the largest monthly increase in 10 months, excluding pandemic-related distortions. The unemployment rate in Australia also fell below analysts' expectations, prompting a reduction in market expectations for interest rate cuts by the central bank to 37 basis points for the year, down from the previous forecast of 44 bps.
Performance of ASX sectors
Financials declining by 0.35% in what its worst session in a week could potentially be if losses persist. Three of the "Big Four" banks saw their shares trading in negative territory.
Mining index dipped by 0.97% but were on track to register a weekly gain of 2.48%, marking their best performance since late January. Notably, BHP Group (ASX: ASX:BHP) and Rio Tinto (ASX: ASX:RIO) saw modest decline of 0.63% and 0.64%, respectively.
Energy stocks experienced a notable decline of 1.36%, mirroring a drop in oil prices driven by weaker U.S. gasoline demand and reports of a UN draft resolution calling for a ceasefire in Gaza. Despite this, the energy sub-index was poised to record its best weekly performance in seven weeks. Major players in the sector, including Woodside Energy (ASX: WDS) saw a decline of 1.85%.
Gold stocks also faced downward pressure, declining by 1.42% as the price of gold retreated from its record-high levels. Northern Star Resources (ASX: ASX:NST) and Evolution Mining (ASX: EVN) saw losses of 0.58% and 1.59%, respectively.