More than $50b wiped off ASX as miners and banks fall; Oil prices climb

War concerns gripped the Australian sharemarket on Wednesday, wiping out more than $50 billion in value. The slump followed a sell-off on Wall Street and other global markets as oil prices continued to rise amid fresh attacks in the Middle East.

The S&P/ASX 200 slid 176.10 points, or 1.9 per cent, to 8901.20, plunging below the 9000 mark in its biggest decline since early February. All 11 industry sectors were in the red, with a 3 per cent fall in mining stocks leading the way down. The losses come after the ASX dropped 1.3 per cent on Tuesday. The Australian dollar was trading at US70.01¢ at 4.57pm AEDT, down 0.5 per cent.

A senior investment adviser at Shaw and Partners, Adam Dawes, said geopolitical concerns helped drive the slump, and a key concern for investors was the risk that the conflict in Iran would persist for longer than expected.

“We should have had this fall on Monday. I think we are just playing catch up with geopolitical and global concerns,” Dawes said. “The big thing that the market is worried about is how long this Middle East conflict will go for. The market potentially thinks this is not just a flash in the pan.”

The price of oil jumped after the conflict flared up on the weekend, and Brent crude oil rose toward $US83 a barrel on Wednesday after rallying about 12 per cent over two days, the biggest gain since 2020.

With the Iran war and inflation-boosting rises in energy costs front of mind, investors also digested figures from the Australian Bureau of Statistics that showed the Australian economy expanded by 0.8 per cent through the final three months of 2025, its best performance in almost three years. Annual GPD growth lifted to 2.6 per cent.

The strong GDP outcome could help pave the way for interest rate rises by the Reserve Bank as it “strengthens the case that the economy can tolerate another nudge tighter if inflation risks demand it,” said Sunny Nguyen, head of the Australia Economics team at Moody’s Analytics.

It was an ugly session for the nation’s mining heavyweights amid rising concerns about the fallout of the Iran war on global growth. BHP, the world’s biggest miner, slumped 3.5 per cent. Rio Tinto fell 1.3 per cent and Fortescue Metals lost 3 per cent.

Gold stocks also lost their shine, as bullion prices fell 3.5 per cent on Tuesday. US bond yields jumped overnight amid concerns that spiking energy costs, due to the war, will make inflation worse and lead to higher interest rates. When sovereign bonds such as US Treasuries pay more interest, they can hurt the appeal of gold, which pays its investors nothing. However, gold prices strengthened again on Wednesday as dip-buyers entered the fray.

Gold miners Northern Star fell 2.5 per cent, Evolution Mining lost 4.7 per cent and Newmont Mining slumped 6.3 per cent, but they’d slid even more in early trade.

The other key sector for the ASX, financials – which make up more than a third of the entire market – also fell sharply, with all big four banks losing ground. Commonwealth Bank fell 1.2 per cent. National Australia Bank dropped 2 per cent, Westpac shed 1.6 per cent and ANZ Bank slumped 3.7 per cent. “Millionaires’ factory” Macquarie dropped 2.5 per cent.

Airline stocks were down for a third day. Qantas fell 2.7 per cent and major Qatar Airways code-share partner Virgin Australia lost 2.9 per cent, as the escalating conflict sent fuel prices surging and continued to disrupt flights via the region. Flight Centre dropped 1.1 per cent.

Consumer stocks were also sold off, hurt by concerns that price rises as a result of the war will weigh on shoppers’ wallets, hurting company profits. Wesfarmers, the owner of the Bunnings and Officeworks chains, fell 1.5 per cent, electronics retailer JB Hi-Fi lost 1.7 per cent and Super Retail Group, which owns the Rebel Sports and Supercheap Auto chains, ended down 2.1 per cent.

Among the consumers staples, Endeavour lost 3.5 per cent after the owner of the Dan Murphy’s and BWS bottle shops said its first-half profit fell 17.1 per cent to $247 million in what it said was “a challenging market”. The company cut its dividend by 13.6 per cent to 10.8¢ a share. Treasury Wine Estates fell 6 per cent, and Woolworths, which traded ex-dividend, was down 2.6 per cent.

Real estate investment trusts were another sector hit in the sell-down. With bond yields rising, their dividends tend to become less appealing to investors compared with lower-risk, fixed income securities. Goodman Group, which owns warehouses and IT data centres, fell 3.7 per cent. Shopping centre landlords Scentre and Vicinity were down 2.4 per cent and 2.5 per cent, respectively.

Bucking the downward trend was ARN Media, the owner of the KIIS radio network, which gained 4.4 per cent after its decision to end The Kyle and Jackie O Show. Senior industry sources have labelled the move “opportunistic” and a convenient exit to the record-breaking $200 million contract with the two shock jocks.

On Wall Street, the big moves that rocked US shares in early trade eased substantially as the session went on overnight. By the end of its Tuesday session, the S&P 500 had sunk 0.9 per cent. That would be a solid loss on a typical day, but the index had been down as much as 2.5 per cent because of concerns the war may do more sustained damage to the global economy than feared.

The Dow Jones dropped 403 points, or 0.8 per cent, after plunging more than 1200 points earlier in the day. The Nasdaq composite pared its loss to 1 per cent.

Markets around Asia also tumbled Wednesday, with South Korea’s benchmark plunging more than 11 per cent. In Thailand, the benchmark stock gauge plunged 8 per cent, triggering a suspension in market trading.

with Clancy Yeates, AP and Bloomberg

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