Shares drop, oil rebounds as US and Iran exchange fire
The reignited conflict in the Persian Gulf is weighing heavily on the Australian stock market in the final session of the week, shaking the fragile ceasefire and shaking investors’ confidence.
The S&P/ASX200 fell 143.6 points at midday, falling 1.62 percent to 8,734.5 points, while the All Ordinaries index lost 137 points, or 1.5 percent, to 8,970.7 points.
IG market analyst Tony Sycamore said the local market had rebounded in the last two sessions on hopes that the US conflict with Iran would ease, but a solid peace deal appeared elusive.
“Tensions flared again this morning following reports that the United States attacked targets in southern Iran, including the major oil port of Bandar Abbas and Qeshm Island,” he said.
Iran responded by targeting US ships in the eastern Strait of Hormuz and vowed to retaliate for any further attacks.
“This continues the pattern of recent increases towards the weekend before tensions ease, ahead of reopening the following week,” Mr Sycamore said.
Despite Friday’s decline, the local stock market remains on track to narrowly break its three-week losing streak following a strong recovery on Wednesday and Thursday.
The heavyweight financial sector was under heavy pressure heading into the weekend, falling 2.3 percent, tracking declines at the big four banks.
Investment giant Macquarie Group fell 1.9 percent to $236.50 despite making an eye-popping $4.8 billion in net profit through March, up 30 percent from fiscal 2025.
Miners also declined; Basic materials fell 1.6 per cent as BHP, Rio Tinto and Fortescue gave back some of the gains made in the previous two sessions.
Gold miners were lower, with the precious metal hovering near US$4,720 ($A6,546) an ounce.
Even energy and utility stocks couldn’t escape the sell-off despite the rise in oil prices; each sector was down one and two percent respectively at midday.
Consumer-facing stocks were also in the red, with Wesfarmers, Woolworths and Coles falling.
Real estate shares fell two percent in the first hour of trading, a broad-based decline that erased gains from the previous two sessions.
There were a handful of companies that escaped the sell-off, with Real Estate.com.au owner REA Group jumping 3.4 per cent to $180.39 after reporting strong earnings growth in the third quarter.
News Corporation charged more than four per cent after revenue rose to US$2.2bn in the three months to March, a nine per cent increase on the same quarter in 2025, putting the company on track for a record profit for the full year.
Tabcorp fell for a second day after flagging an AUSTRAC investigation into potential money laundering liability breaches, with its share price falling almost 30 per cent in two sessions.
The Australian dollar bought 72.09 US cents from 72.50 US cents at 17:00 on Thursday, while decreasing risk perception supported the dollar.
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