Why is the Australia 200 trading lower after Rio Tinto's earnings?

The Australia 200 trades 6 points (-0.07%) lower at 8750 as of 2.25 pm AEST.

Rio Tinto's earnings weigh on Australia 200

The Australia 200 (ASX 200) started today much as it did on Tuesday, falling 55 points (-0.62%) to a low of 8701 before dip buyers emerged, with just a touch of month-end window dressing thrown in for good measure.

The early falls came courtesy of the big miners. Rio Tinto's earnings report was released after the market closed yesterday, showed the following results:

• Underlying earnings: fell 16% to $4.8 billion in the first half (H1) of 2025 from $5.8 billion a year earlier, marking the lowest first-half profit since 2020, following a decline in iron ore prices
• Reduced interim dividend: $1.48 per share, down from $1.77, marking its lowest dividend in seven years.

Economic data sets the stage for recovery

Setting the platform for today’s rebound was the release of robust activity data for June, which has admittedly resulted in the probability of an August Reserve Bank of Australia (RBA) interest rate cut easing marginally.

Retail sales surged by 1.2% month-on-month (MoM) in June, driven by discounting and pushing the annual rate to 4.9%, the highest growth rate seen since March 2023. Building approvals data for June were also stronger than expected, rising by 11.9% MoM from 1.2% prior. This was the strongest gain since May 2023, driven by a large rise in private sector dwellings excluding houses.

Australia 200 poised for a positive July finish

The month of July has again lived up to its reputation for being a good one for the Australia 200. As it enters the home straight, it is poised for a 2.45% gain for the month and on track for a fourth straight month of gains. This is made more memorable by its 1580-point (22%) rally from its early April 7169.2 low.

Australia 200 stocks

Consumer discretionary sector

The better retails sales data supported the Australia 200 consumer discretionary sector to its highest level in five months.

• Aristocrat Leisure added 2.65% to $70.24
• Temple and Webster rose 1.7% to $24.25
• Nick Scali gained 0.92% to $19.28
• Harvey Norman climbed 0.87% to $5.79
• Flight Centre fell 8.54% to $11.78, hitting its lowest level since Covid-19 in 2020, after its full year guidance missed by approximately 8%

Energy sector 

• Beach Energy dropped 8.91% to $1.17 following its disappointing quarterly update, which included a $674 million pre-tax impairment driven by lower commodity prices

Mining sector

• Rio Tinto fell 3.08% to $112.24
• Mineral Resources slumped 8.87% to $28.05 following a broker downgrade
• Fortescue declined 2.45% to $17.74
• BHP dropped 2.10% to $39.38

Techonology sector

Information technology (IT) stocks gained as bumper earnings reports from tech giants Microsoft and Meta, released after the bell, propelled US Tech 100 (Nasdaq 100) futures 1.35% higher to 23,686.

• Megaport climbed 4.32% to $15.22
• Life360 rose 3.5% to $40.26, reaching a record high
• DroneShield surged 16.40% to $3.69 following a broker upgrade with a $3.80 target

Australia 200 technical analysis

After hitting a fresh record high of 8776.4 in mid-July, the Australia 200 proceeded to spend the next two weeks consolidating above short-term support at approximately 8620 - 8600, building for a retest of the record high.

While yesterday’s session saw it fall just 3.5 points short of a new record high, the door remains open for a push to new highs, provided it remains above our 8620 - 8600 reassessment zone. Be aware that a daily close below 8600 would be an initial warning that the move to the 8776.4 high was a false break higher and that a retest of the late June 8420 low is underway.

Australia 200 daily chart

• _{Source: TradingView. The figures stated are as of 31 July 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.}