Australia 200 afternoon report:
12 June 2025

The Australia 200 trades 7 points (0.09%) lower at 8584 as of 2.45pm AEST.

Australia 200 eases amid rising geopolitical tensions

A day after surging to fresh highs, the Australia 200 is taking a breather amid rising geopolitical and trade-related headwinds.

Geopolitical tensions in the Middle East have spiked significantly after Iran stated it would target United States (US) bases in the region if nuclear talks failed. This has been followed by reports that Iran is jamming global positioning systems (GPS) across the region, while cyber-attacks have targeted Jordan and Kuwait. The US is evacuating non-essential embassy staff from Iraq, Kuwait, and Bahrain, and there are unconfirmed reports of potential airstrikes in Iran.

This blow to risk sentiment, which resulted in a 0.30% fall in US equity futures, comes at a potentially pivotal time after macro and systematic funds have rebuilt long positions and investor sentiment has rebounded to bullish levels.

Challenges in US-China trade negotiations

Turning to tariffs, and following yesterday’s much-hyped US-China trade 'deal,' which will merely maintain the status quo of elevated tariffs agreed upon last month in Geneva, President Donald Trump announced this morning that the US will be sending letters to trading partners setting new tariff rates.

With the clock running down on the 90-day pause ahead of the 9 July deadline, Trump’s announcement reflects the reality that managing 150 countries seeking agreements is not feasible.

Australia 200 stocks

Energy stocks

The rise in Middle Eastern tensions which prompted a 4.88% gain in crude oil futures to $68.15, has bolstered demand for Australia 200-listed energy stocks. 

• Beach Energy rebounded 3.44% to $1.27
• Woodside Energy rose 1.66% to $23.92
• Santos gained 0.82% to $6.75

Materials sector

• Mineral Resources plunged 5.74% to $24.24
• Fortescue Metals Group dropped 2.81% to $15.76
• Rio Tinto declined 1.15% to $108.11
• BHP edged 0.74% lower to $38.76

Financial sector

The financial sector hit a fresh record high of 9470 yesterday, 25.5% above its April lows, before retreating as profit-taking set in.

• Macquarie Group slipped 1.17% to $214.55
• Westpac fell 0.37% to $33.50
• ANZ lost 0.27% to $29.86
• Commonwealth Bank of Australia eased 0.20% to $181.07

Health care sector

Cochlear plunged 9% to $246.52 following a modest guidance downgrade for financial year 2025. The move appears to be an overreaction, with shares later rebounding to trade 0.62% lower at $268.83.

Consumer discretionary sector

Cettire sank 30.65% to $0.32 after delivering a disappointing trading update that rattled investor confidence.

Australia 200 technical analysis

After clinching a new high yesterday, we are watching to see if the Australia 200 will reject or extend the move. We note that the relative strength index (RSI) is at its most overbought level since December 2023 (which was followed by a 4% pullback).

We also note that yesterday’s price action left in place a 'loss of momentum' type candle. Furthermore, we are now seeing some preliminary signs of upside rejection.

While these developments do not guarantee a pullback, they do signal that the rally from the April lows is mature. From a price perspective, a break of support at 8500 would be an initial indication that the Australia 200 has put in place a medium-term top and that a pullback is underway. Until then, allow for the Australia 200 to extend its gains towards 8800.

Australia 200 daily chart

• _{Source: TradingView. The figures stated are as of 12 June 2025. Past performance is not a reliable indicator of future performance. This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation.}