Australian shares close at two-week low on oil price concerns

[SYDNEY] Australian shares ended at their lowest in more than two weeks on Thursday (Apr 23), driven by a broad-based sell-off across most sectors as stalled US-Iran peace talks and elevated oil prices sapped risk sentiment, while energy major Santos jumped more than 3 per cent.

The benchmark S&P/ASX 200 index fell 0.6 per cent to 8,793.40 points, their lowest closing point since April 7.

There were no indications of peace talks resuming, while Iran’s seizure of two ships in the key Strait of Hormuz, a day after US President Donald Trump announced an indefinite ceasefire, has kept investors on edge.

With valuations still stretched and doubts over economic growth, it is difficult to get bullish on the broader ASX 200 index, said Luke Winchester, portfolio manager at Merewether Capital.

With macroeconomic disruptions and a down season for the market, investors are keeping more cash on the sidelines until there is better clarity on annual earnings, Winchester said.

Persistent inflation could force the central bank to raise the key cash rate in early May. Swaps imply nearly a 75 per cent chance of a 25-basis point tightening to 4.35 per cent by the monetary policy board.

Financials lost 0.7 per cent, falling for a ninth straight session, during which it shed more than 5 per cent. The “big four” banks slid between 0.2 per cent and 1 per cent.

Heavyweight miners declined 1 per cent in their worst session since April 2. Mining majors Rio Tinto and Fortescue fell 0.6 per cent and 1.1 per cent, respectively.

Santos climbed 3.6 per cent, logging its best day since March 2 after retaining its annual production and sales volume forecast. Larger rival Woodside Energy advanced 3.2 per cent.

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Australian shares fall as doubts over US-Iran deal persist; banks, miners drag

That drove the energy sub-index 3.1 per cent higher, ending a six-session losing streak, with Brent crude at around US$103 a barrel.

Healthcare stocks slumped 0.4 per cent, hitting over 8-year low. CSL fell 0.2 per cent to extend losses, after US military scrapped its flu vaccine mandate on Tuesday.

In New Zealand, the benchmark S&P/NZX 50 index fell 0.5 per cent to 12,884.93 points, its lowest closing level in more than three weeks. REUTERS