Australian shares slumped more than 1% in a broad sell-off on Monday as traders exited risk assets on concerns over the impending US reciprocal tariffs, while market participants monitored the domestic central bank for its policy decision.
The benchmark S&P/ASX 200 index lost 1.7% to close at 7,843.4 points.
It ended the quarter 3.9% in the red, wrapping up a volatile three months that saw the index plunge from its all-time high in mid-February to confirming correction within weeks on stretched valuations and tariffs concerns.
Australia’s commodities sector, previously stable, is experiencing seller pressure likely due to the end-of-month or quarter portfolio rebalancing, said Henry Jennings, senior analyst at Marcus Today newsletter.
Jennings attributed the benchmark’s slump to global growth concerns from US tariffs due later this week.
A newly formed monetary policy board of the Reserve Bank of Australia (RBA) is widely expected to keep the interest rate unchanged at 4.10% at its April 1 meeting, a Reuters poll showed, as the bank awaits concrete signs of easing inflation.
Swaps imply an 18% probability that the RBA will move on Tuesday, while an easing in May is about 70% priced in.
“The first meeting of the RBA’s new Monetary Policy Board (MPB) this week is not expected to surprise markets,” Westpac analysts said.
Heavyweight miners tumbled 3.6% to a more than two-week low.
Banks drag Australian shares lower amid growing trade war worries
BHP Group and Rio Tinto slipped 3.8% and 4.8%, respectively.
Financials shed 1%, while energy stocks lost 2.7%.
In New Zealand, the blue-chip S&P/NZX 50 index dropped slightly to 12,270 points.
The country’s central bank said it would review bank capital requirements this year following criticism of the regime for being too strict and stifling competition in the sector.
American Dollar Exchange Rate