ASX 200 Market Outlook: All Sectors See Red After Hawkish RBA Hold
ASX 200 fell across all sectors after a hawkish RBA hold lifted rate expectations and pushed yields higher.
Share this:
The Reserve Bank of Australia kept the cash rate at 3.6% as expected but delivered a distinctly hawkish tone. Policymakers warned that inflation risks have “tilted to the upside”, with Governor Bullock signalling the board remains dissatisfied with current price pressures. February’s meeting now hinges on the trajectory of inflation, placing extra weight on the January 26 quarterly CPI release.
Bond markets reacted swiftly: Australia’s 3-year yield climbed to 4.15%, while the 1-year sits at 3.97%. Bloomberg data shows a 25bp hike now fully priced by June, compared with November before the meeting. AUD/USD gained 0.4%, although further upside may be limited given a hawkish outcome has been priced for weeks.
The ASX 200 fell 0.45% in its worst session in six days, with all 11 sectors trading lower following the RBA’s stance.
View related analysis:
View related analysis:
ASX 200 Slides as Hawkish RBA Weighs on All Sectors
ASX 200 Market Snapshot
- A 3-bar evening star reversal formed on the ASX 200 daily cash chart.
- Information Technology (XIJ), Health Care (XHJ) and Energy (XEJ) led all 11 sectors lower.
- Materials (XMJ) pulled back from its record high for a second straight session.
- Market breadth weakened: 66 stocks advanced, 123 declined and 11 finished unchanged.
Chart analysis by Matt Simpson - source: ASX, LSEG
ASX 200 Futures (SPI 200) Sector Analysis
The daily chart shows bearish momentum returning around the 200-day EMA and monthly pivot. Daily volumes remain below the 20-day average, although they are slightly higher than yesterday’s. While price holds beneath last week’s high, the bias still favours a move towards 8500.
Take note that the FOMC meeting could influence the ASX 200 via Wall Street’s reaction. I suspect the Fed will lean slightly hawkish, which may lift the US dollar and weigh on US indices. That said, the ASX also has a tendency to firm into the new year from around mid-December.
Chart analysis by Matt Simpson - Source: TradingView, ASX SPI 200 Index Futures
Related tags:
Latest market news
Open an account in minutes
Experience award-winning platforms with fast and secure execution, and enjoy tight spreads from 0.5 pts on FX and 0.3 pts on indices.
Economic calendar
Web Trader platform
Our sophisticated web-based platform is packed with features.
Related articles
EUR/USD weekly outlook: FOMC and ECB to set the tone
The current backdrop is modestly bearish. On Friday, the EUR/USD closed modestly lower, down for the third consecutive day. The pair also posted a weekly decline after staging a modest recovery attempt in the previous week. Out of the past 8 weeks, the EUR/USD has fallen on 6 occasions. There is not much supporting factors for the single currency right now. So, the upside remains capped.
Silver forecast: metals liquidation drags XAG/USD into $50-55 support
Silver has broken its July low and slipped into a long-term support zone as the selling in precious metals deepens. The chart shows where the metal could bottom, and next week's Fed decision may decide whether it does.
S&P 500 forecast: AI linked stocks remain under pressure
And just like that, it is Friday again and the end of a volatile week. Today offers little on the macro calendar to change the prevailing narrative, leaving markets largely at the mercy of risk appetite, oil prices and the growing unease around the AI trade.
This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.
StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.
In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.
StoneX Financial Pte. Ltd. is not under any obligation to update this report.
Trading CFDs carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.forex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.