Australian shares closed the week on a somber note as the benchmark index, the S&P/ASX200, extended its losses on Friday, largely driven by a sell-off in technology and material stocks.
The index slipped by 0.6 per cent to 7773.3 at the closing bell, marking a continuation of the downward trend witnessed throughout the week. In tandem with this decline, the broader All Ordinaries index also shed 0.6 per cent, reflecting the pervasive negative sentiment across the market.
The sell-off was broad-based, with all 11 industry sectors dipping into the red. Particularly notable was the slump in tech and material stocks, which weighed heavily on the overall performance of the market. This decline in tech shares mirrors similar trends observed in global markets, as concerns over valuations and regulatory pressures continue to unsettle investors.
During the night on Wall Street, all three major indices ended in negative territory following a cautionary statement from Minneapolis Federal Reserve President Neel Kashkari, who highlighted the potential for no rate cuts this year if progress on inflation stagnates.
Steven Daghlian, a market analyst at CommSec, noted that expectations regarding rate cuts were undergoing frequent shifts, particularly as equities approached lofty levels.
“Market sentiment can easily be swayed by commentary from Fed officials delaying the possibility of the first rate cut, or by disappointing economic data,” Mr Daghlian remarked. “This volatility is likely to persist for the foreseeable future.”
Mr Daghlian noted that forthcoming jobs and inflation data from the United States would offer traders further insights into the trajectory of interest rates.
Domestically, technology stocks sensitive to interest rates experienced the most significant decline, dropping by 1.4 per cent, with Wisetech and Xero both falling by 1.7 per cent to $90.87 and $123.00, respectively.
Meanwhile, on the Singapore Exchange, iron ore futures for the May contract dipped by 0.8 per cent to $US96.95 per tonne, reflecting a downturn in miners for the crucial steelmaking commodity.