The Australian Securities Exchange (ASX) closed in negative territory on Tuesday, driven by significant declines in gold miners and major corporations, overshadowing gains in financial and retail sectors. The S&P/ASX 200 index fell by 43.1 points, or 0.5%, to 9012.5, erasing the previous day’s gains of 0.4%. The Australian dollar was trading at US65.56¢ at 4:45 pm AEDT.
Corporate news played a pivotal role in the market’s performance. Shares of WiseTech Global, a major software company, plummeted after reports surfaced that Australian Federal Police and market regulators had raided its Sydney headquarters. The raid, conducted on Monday, was part of an investigation into alleged trading activities involving the company’s billionaire co-founder Richard White and three employees between late 2024 and early 2025.
Impact of Corporate Developments
WiseTech Global’s stock took a severe hit, plunging 15.9% following the announcement of the raid. The company’s board confirmed the investigation, which has raised concerns about corporate governance and compliance within the tech giant.
Meanwhile, CSL, Australia’s largest healthcare company, also faced a significant downturn. The company’s shares dropped 15.9% after it issued a profit warning for its Seqirus vaccine business, citing vaccine skepticism in the United States. CSL’s chairman, Brian McNamee, described the decline in US vaccination rates as a “massive shock” and announced a delay in the planned spin-off of its Seqirus arm.
Gold Miners and Market Reactions
The gold mining sector experienced notable declines as gold prices fell below $US4000 ($6106) an ounce. This drop extended losses from what has been described as the worst rout in more than a decade. Progress on a US-China trade deal diminished the demand for gold as a safe haven, with spot gold falling as much as 3.4% to below $US3980 overnight.
Major gold miners such as Northern Star Resources, Evolution Mining, and Greatland Resources saw their shares fall by 3.1%, 3.9%, and 9.1%, respectively. Newmont, the world’s largest gold miner, also experienced a decline of 4.1%.
Chinese and US trade negotiators have lined up an array of diplomatic wins for US President Donald Trump and counterpart Xi Jinping to unveil at a summit this week.
Broader Market Movements
The potential trade agreement between the US and China also impacted rare earth miners. US Treasury Secretary Scott Bessent highlighted agreements regarding China’s purchase of rare-earth exports. This follows a critical minerals deal signed by President Trump with Australia. As a result, Lynas, Australia’s largest rare earth miner, saw its shares slump by 13.9%, while Iluka and Dateline Resources fell by 5.2% and 29%, respectively.
Oil and gas companies like Woodside and Santos also ended lower, with declines of 1.7% and 2.2%, respectively, amid a two-day drop in oil prices. Despite a stabilization on Tuesday, oil prices are on track for a third consecutive monthly loss due to concerns about a supply glut and the impact of US sanctions on Russian producers.
Financial and Retail Sectors
On a positive note, the financial sector performed well, with the big four banks all trading higher following a strong session on Wall Street. Commonwealth Bank of Australia (CBA), the largest stock on the Australian market, rose by 1.4%. Westpac, National Australia Bank, and ANZ Bank also posted gains.
Retailers benefited from a boost in consumer confidence, as indicated by the ANZ-Roy Morgan Australian index, which showed a 2.8 percentage point increase over the past fortnight. Wesfarmers, JB Hi-Fi, and Eagers Automotive all reported gains, with Eagers Automotive up by 6.3%.
Domino’s and Other Corporate Moves
Domino’s Pizza shares soared by 17.4% before the company requested a trading halt following speculation about a potential buyout by Bain Capital. The company later dismissed the rumors, stating that it had not received any proposals from the private equity firm. Despite this, Domino’s shares closed up by 7.2%.
In another corporate move, AUB Group saw its shares jump by 5.9% after receiving a $5.2 billion takeover offer from Swedish private equity firm EQT. This highlights the increasing interest of foreign buyers in Australia’s financial sector, driven by the country’s wealth and superannuation boom.
On Wall Street overnight, the S&P 500 rose 1.2%, the Dow Jones added 0.7%, and the Nasdaq composite jumped 1.9%, each setting an all-time high for the second consecutive day.
Global Market Context
The positive performance of US markets comes ahead of a meeting between US President Donald Trump and Chinese President Xi Jinping, where a trade framework is expected to be discussed. Additionally, the Federal Reserve’s upcoming announcement on interest rates is highly anticipated, with expectations of a quarter-point rate cut at its second consecutive meeting.
However, uncertainties remain, particularly regarding inflation and the potential impact of a prolonged US government shutdown. The latest monthly inflation report exceeded economists’ expectations, offering some optimism, but the situation remains fluid.
As major US companies like Alphabet, Meta Platforms, Microsoft, Amazon, and Apple prepare to report their earnings, the focus will be on their growth prospects and investments in artificial intelligence technology. Concerns about a possible AI bubble, reminiscent of the dotcom era, continue to loom over the market.
The week ahead promises to be eventful, with key developments in trade negotiations, corporate earnings, and monetary policy likely to shape market dynamics both in Australia and globally.
