Shares slip, banks under pressure ahead of budget
Australia’s stock market is on course for a third straight session of losses as oil rebounds after hopes for a US-Iran peace deal fade and local banks retreat ahead of the federal budget.
The S&P/ASX200 fell 67.2 points, or 0.77 percent, to 8,634.9 points at midday, while the All Ordinaries lost 69.6 points, or 0.78 percent, to 8,872.8 points.
Nine of 11 domestic sectors were trailing by midday after President Donald Trump said the US ceasefire with Iran was “on life support” after the White House trashed its response to Tehran’s peace offer.
IG market analyst Tony Sycamore said Australia’s big banks were under pressure ahead of Tuesday night’s federal budget.
“This budget is shaping up to be the most significant budget in years, largely due to negative gearing and expected revisions to capital gains tax,” Mr. Sycamore said.
“With Australian banks’ heavy exposure to residential mortgages, any policy change that causes a sustained decline in property prices could increase mortgage stress and bad debts, putting pressure on bank profitability and share prices.”
Shares in CommBank, NAB and ANZ lost more than two per cent, while Westpac lost 1.6 per cent to $36.53.
The heavyweight financial sector fell almost two per cent, with investment managers, insurers and fintechs also falling into the red.
Basic materials offset sales somewhat, up 2.4 percent, with BHP rising to a record high of $60.23.
Energy stocks and utilities were the other two sectors trading higher, up 0.1 percent and 0.6 percent respectively at midday, as Brent crude futures rose above $105 a barrel.
Woodside, Santos, AGL and Origin traded higher, while coal producers and uranium stocks fell.
The healthcare sector fell 2.5 per cent and drifted lower, with blood plasma giant CSL hitting its lowest price since December 2016 and falling almost 19 per cent since Monday’s dismal trading update.
Consumer-facing stocks were doing poorly; Discretionary products fell by 2.3 percent, while staple food products lost 1.9 percent in broad-based sales.
BT shares fared even worse, falling 3.6 per cent, with tracking app Life360 losing more than a tenth of its value following a mixed update in the first quarter.
In company news, former market darling Droneshield fell 15 percent to a three-month low of $3 after the corporate regulator announced it would launch an investigation into the defense technology company.
The investigation relates to information provided to exchange operator ASX and share trading between 6 and 12 November 2025, including the sale of approximately $70 million of Dronshield shares by chief executive Oleg Vornik, chairman Peter James and director Jethro Marks.
The Australian dollar is buying 72.32 US cents, down slightly from 72.38 US cents at 5pm on Monday.
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