Global Markets | Australian shares tread water as tariff tension, inflation data keep investors on edge

Australian shares struggled for momentum on Tuesday, with losses in heavyweight banks offsetting gains in miners, as investors stayed cautious ahead of key domestic data and sought clarity on the latest tariff salvo.

The S&P/ASX 200 index ended little changed ‌at 9,022.30 points. The ⁠benchmark ⁠had closed 0.6% lower on Monday.

The local market stayed in wait-and-see mode after U.S. President Donald Trump warned countries not to retreat from recently negotiated trade deals, saying he would impose much higher duties if they did.

Investors were also awaiting Wednesday’s consumer price data, seen as key after Australia’s recent rate hike. Reserve Bank of Australia is the only major central bank outside Japan to tighten ⁠policy this ‌year, driven largely by expectations that inflation would run above the its target band.

“The market feels like it’s caught in a ⁠classic ‘risk-off rotation’ tug-of-war – defensives and rate-sensitive sectors are holding the index up, but financials and growth names are taking hits,” said Tim Waterer, chief market analyst at KCM Trade.

“The broader theme is caution: tariff headlines…and the looming CPI print tomorrow are keeping traders on edge.”
On the bourse, financials fell 0.3%, weighed down by a 3.6% slide in Macquarie amid growing worries that higher-for-longer rates could crimp lending growth and fee income, ‌Tim added. Technology stocks fell 3.5% while real estate slipped 1.2%.

Among the few sectors trading in the green, miners rose 1.1%, with BHP adding 1.4%. The heavyweight miner ⁠hit a record high earlier in the session, surpassing the A$55 mark for the first time.

The sub-index was further boosted by a rally in lithium miners, which surged on renewed optimism around lithium prices.

Pilbara Minerals and Mineral Resources gained 8% and 6.5%, respectively.

Energy stocks rose 1.7%, helped by firmer oil prices and Woodside Energy‘s profit beat, which lifted its shares to a near 19-month high.

New Zealand’s benchmark S&P/NZX 50 index rose 0.8% to finish the session at 13,532.31 points.