Australian shares slip as miners weigh; banks, tech cushion the blow

By Reuters News

By Anjali Singh

- Australian shares inched lower on Thursday after a three-day rally, led by heavyweight miners due to weaker commodity prices, although the losses were capped by gains in financials and tech shares.

The benchmark S&P/ASX 200 index .AXJO fell 0.1% to 9,146.80 points. The index has gained 1.5% in the last three sessions and is up nearly 4% over three weeks.

The pause in the rally comes a day after the index's relative strength index came close to 70, a level that typically signals overbought conditions.

Miners .AXMM shed 2.3%, tracking weaker iron ore prices. Environmental output curbs in China and softer steel demand from the country have been weighing on the commodity, directly hitting heavyweights BHP Group BHP.AX and Rio Tinto RIO.AX.

Gold miners .AXGD deepened the mining sector's drag, with gold stocks down 3.6% as bullion touched a one-week low. GOL/

Banks .AXFJ climbed 1.1%, with three of the 'Big Four' advancing between 0.5% and 2.9%. Investors looked past the civil penalty proceedings launched by the corporate regulator against Commonwealth Bank of Australia, and the stock jumped nearly 3%.

"Historically, penalties and remediation have been small relative to CBA's earnings. The bigger risks are reputational and the ongoing cost of compliance. Investors are far more focused on margins, credit quality as rates rise, and CBA's premium valuation," said William Taylor, COO and portfolio manager at ETF Shares.

The case would only become material if it highlighted a broader systemic problem or a much larger remediation bill, he added.

Local tech stocks remained resilient even as AI-related concerns battered global tech. "The local rally looks like a mix of bargain hunting after the pullback since late August and rotation out of resources," Taylor said, adding that the domestic tech sector was dominated by software, platform and data centre businesses rather than chipmakers.

The technology sub-index .AXIJ ticked up 0.3%, with constituent Xero XRO.AX adding 6.1%.

Across the Tasman Sea, the New Zealand benchmark S&P/NZX 50 index .NZ50 extended gains for the third straight session and rose 0.7% to a fresh record of 14,275.30 points.

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