Australia 200 afternoon report: 18 March 2025

The Australia 200 trades 6 points (0.10%) higher at 7860 as of 3.00pm (AEDT)

Will Australia 200 extend rally despite Middle East tensions?

The ASX 200 is trading marginally higher this afternoon, paring gains from an intraday high of 7922 after Israel launched airstrikes on Northern Gaza, ending the fragile ceasefire that had been in place since January.

The local bourse's disappointing session came despite Dow Jones extending its rally as firmer retail sales data for February eased, for the moment, fears of an impending US recession. While the headline retail sales number was softer than expected, the all-important Retail Sale Control group, which feeds into GDP, surged by 1% versus 0.4% expected.

Jobs report and interest rate outlook

Thursday's jobs report for February is expected to show the Australian labour market remains in good shape, with the creation of 20,000 new jobs and the unemployment rate remaining at 4.1%. This will likely ensure the Reserve Bank of Australia (RBA) keeps interest rates on hold at its April meeting and waits for softer fourth quarter (Q4) inflation and labour market data before cutting rates in May.

Energy sector

The news of Israel's air strikes on Gaza, coming just 48 hours after the US attacked the Houthis in Yemen and vowed to keep attacking them until the group ends its attacks on passing shipping, has raised geopolitical risks in the region and for the crude oil price.

• Beach Energy added 1.25% to $1.42
• AGL Energy rose 1.13% to $10.74
• Santos climbed 0.8% to $6.34, aided by news that its joint venture in Alaska had announced an oil discovery

Gold sector

Meanwhile, rising geopolitical concerns sent the price of gold to a fresh record high of US$3015.

• Regis Resources gained 1.4% to $3.62
• Perseus Mining climbed 1% to $3.16
• Northern Star Resources rose 0.5% to $17.86
• Gold Road Resources lost 4.15% to $2.52 after it announced mechanical fails led to lower March Quarter output

Banking sector

The big banks had a mixed day.

• Macquarie dropped 1.9% to $196.98
• National Australia Bank fell 1.43% to $32.65
• Commonwealth Bank of Australia slipped 0.6% to $143.77
• Australia and New Zealand Banking Group rose 0.37% to $28.80
• Westpac increased 0.9% to $30.16

Materials sector

Rising optimism towards China, following the announcement of measures to boost consumption alongside better-than-expected Chinese activity data, helped the Australia 200 Materials sector rise 3% over the past two sessions.

However, the sector marked time today as gains in coal and uranium miners were balanced by declines in major iron ore stocks:

• Fortescue dropped 2.27% to $16.56
• BHP fell 0.35% to $39.43
• Rio Tinto slipped 0.25% to $118.91

Uranium sector

• Bannerman Energy soared 6.87% to $2.25
• Deep Yellow rose 3% to $1.02
• Boss Energy added 2.51% to $2.45

Australia 200 technical analysis

After slicing through several key support levels just above 8000 in early March, the Australia 200 found some support last week in the 7730/40 area. Provided the Australia 200 remains above support at the 7730/40 area, we look for the Australia 200 to extend its rebound to 8050ish in the sessions ahead.

Australia 200 daily chart

• _{Source: TradingView. The figures stated are as of 11 March 2025. Past performance is not a reliable indicator of future performance. This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation.}