The Australian Securities Exchange (ASX) reversed its recent gains following President Trump’s decision to increase tariffs on China. The S&P/ASX 200 index experienced a significant drop, mirroring Wall Street’s decline, shedding 167.3 points, or 2.17%, to 7,542.3 points by mid-morning. This erased the gains from its best one-day performance in five years. Over the past five days, the index has lost 1.64%, and it has retreated 3.47% in the past year.
All eleven sectors on the ASX experienced losses, with materials, utilities, energy, and industrials leading the decline. Ironically, US inflation data came in lower than expected. ANZ Head of FX Research Mahjabeen Zaman noted that this development, which would normally pave the way for Federal Reserve rate cuts, received less attention due to the current economic climate.
Amidst market volatility, gold demand surged, reaching a new record high of US$3,190 an ounce. Several gold producers, including Regis Resources, Newmont, West African Resources, De Grey Mining and Evolution Mining, saw their stocks climb in early trading as investors sought safe haven assets.
