ASX Stalls as Tech, Energy Weigh; Fed Holds Rates, Global Tensions Linger

Key Highlights:

• ASX 200 dips marginally to 8,530.5 as eight of eleven sectors fall
• US Fed keeps rates steady, signals two cuts by year-end
• Unemployment in Australia steady at 4.1% in May
• Gold, uranium, and small caps show resilience amid macro jitters
• Global markets mixed; Hang Seng slides, Nikkei rebounds

Australia’s benchmark S&P/ASX 200 index edged down by 0.01% to close at 8,530.5 on Thursday, June 19, 2025, as investor sentiment wavered amid global volatility, hawkish tones from the US Federal Reserve, and pressure on commodity-linked sectors.

Despite early signs of resilience, the All Ordinaries fell 0.07% to 8,752.0, while the Small Ordinaries dropped a sharper 0.62% to 3,228.9. Tech stocks led the drag, with the All Technology Index down 0.80%. Meanwhile, ASX 200 Resources slid 1.01%, weighed by declining commodity prices and cautious investor positioning.

Source: Market Index | Source link: https://www.marketindex.com.au

Wall Street Holds Its Breath as Fed Pauses Again

Overnight in the U.S., the Federal Reserve left its key interest rate unchanged, citing persistent inflation and labor market tightness. The central bank maintained its projection of two rate cuts in 2025, a slower pace than many on Wall Street had anticipated.

RBC’s U.S. economics team interpreted the decision as a sign of “patience” prevailing at the Fed, even as it lowered 2026 GDP growth expectations while forecasting higher unemployment and inflation levels. Analysts flagged tariff-related inflation—especially from the Trump administration’s new trade measures—as a key risk on the horizon.

The S&P 500 slipped 0.03% to 5,980.87, while the Dow dipped 0.10%. However, the tech-heavy NASDAQ eked out a 0.13% gain, underpinned by AI and semiconductor names.

Local Data and Sectors Paint a Mixed Picture

Back home, the Australian Bureau of Statistics reported that unemployment held steady at 4.1% in May—reinforcing expectations of a continued pause in the RBA’s monetary tightening. Still, markets remained cautious as earnings season approaches and global cues remain mixed.

Among ASX sectors:

• Consumer Staples led with a 0.77% gain
• Financials and Discretionary followed with gains of 0.71% and 0.66% respectively
• Materials, Utilities, and Tech were the biggest losers, down over 1% each
  
   

The ASX 200 Banks Index (XBK) rose 0.94%, indicating underlying strength in the financial sector.

Source: Market Index | Source link: https://www.marketindex.com.au

Winners and Laggards: Small Caps and Gold in Focus

Top Gainers:

• Syrah Resources (+7.69%) rebounded strongly on graphite sector optimism
• Appen (+7.61%) climbed on short-covering and M&A speculation
• Clarity Pharmaceuticals (+3.21%) and Southern Cross Electrical (+2.96%) also impressed
  
   

Top Losers:

• Aurelia Metals (-28.69%) plunged following exploration disappointment
• Energy Resources of Australia (-20.00%) continued its downtrend on volume
• Meeka Metals, Resolute Mining, and Lifestyle Communities also slid more than 7%
  
   

Commodities and Currency Trends

Gold rose 0.38% to AUD $3,381.54/oz, offering some safe-haven support amid rate uncertainty. Brent crude declined 0.49% to $76.32/bbl, contributing to weakness in the Energy sector.

The Australian dollar weakened against major peers, falling 0.39% against the USD to 0.6483, as global investors stayed risk-averse.

Outlook: Eyes on Tariffs, Tech, and Rate Cuts

With the Fed signaling fewer rate cuts despite rising inflation risks tied to trade policy, global markets may enter a phase of renewed uncertainty. The ASX is likely to remain range-bound, with further downside risk in resources and tech unless commodity sentiment rebounds.

Investors will now watch for the U.S. PCE inflation data, developments in China’s economic stimulus, and any policy pivot from the RBA. Defensive sectors like consumer staples and healthcare may attract rotation if volatility persists.