UPDATE: The Australian sharemarket is experiencing a significant downturn as fears of global stagflation escalate due to the ongoing Middle East conflict. Just reported moments ago, the benchmark ASX 200 has plunged by 89.30 points, or 1 percent, while the broader All Ordinaries fell 79.80 points, or 0.87 percent, settling at 9,085.10.
As investors react to the turmoil, shares have already decreased by 4.1 percent in March, reversing a positive February where the index rallied 3.7 percent. The Australian dollar has gained slightly, now buying 70.30 US cents, but the outlook remains uncertain.
While the overall market struggles, technology stocks have emerged as a bright spot, surging 4.57 percent today. Notable gains include Wisetech Global, which soared 10.83 percent to $52.72, and Xero, which leapt 4.46 percent to $87.63.
Brent crude oil has recorded its largest weekly increase since 2022, climbing 16 percent to reach $US84 ($AU120) a barrel as the conflict disrupts global supply chains. However, it retreated today following statements from U.S. President Donald Trump, who indicated plans to alleviate supply pressures.
Oil producers have seen mixed results; Woodside Energy gained 0.99 percent to $30.75, while Santos climbed 1.91 percent to $7.46. Yet, miners are suffering, with BHP down 4.24 percent to $52.81 and Rio Tinto falling 3.59 percent to $158.67.
Economist My Bui warns that persistently high oil prices could push household energy costs skyward and dampen consumer spending. “Higher commodity prices could escalate to $150/bbl if the war prolongs, hurting household demand,” she stated.
Market strategist Lochlan Halloway believes the current volatility reflects a rational response to the unpredictable nature of the conflict. “Markets are pricing in a broad spectrum of risks, from temporary disruptions to a catastrophic oil shock,” he noted.
The big four banks have all faced declines this week. Commonwealth Bank shares dipped 0.11 percent to $172.47, NAB fell 1.08 percent to $46.82, and Westpac dropped 0.89 percent to $41. ANZ also traded lower, down 0.34 percent to $37.64.
In company news, Magellan Financial saw shares surge 9.27 percent to $11.55 after the Frank Lowy family acquired a 5.1 percent stake in the firm. Conversely, Deep Yellow shares plummeted 11.79 percent to $2.17 due to reported first-half losses of approximately $7.8 million.
Amid these developments, DroneShield shares jumped 10 percent to $4.07, reflecting heightened demand for its counter-drone technology due to the conflict.
The market remains on edge as investors await further updates on the geopolitical situation and its implications for global economic stability. Stay tuned for the latest developments.
