SYDNEY, March 22, 2026, 05:20 AEDT
Australian stocks finished Friday in the red, logging a third consecutive weekly decline as miners slumped and concerns mounted that persistent oil strength could lock in higher interest rates. The S&P/ASX 200 settled at 8,428.40—down 0.82% for the day—leaving the index about 2.2% below its March 13 mark of 8,617.10 and 8.4% off from the Feb. 27 closing high of 9,198.60.
Investors were forced to digest a fresh rate hike from the Reserve Bank of Australia, coming just as conflict in the Middle East darkened the inflation picture. The RBA moved its policy rate up to 4.10% in a narrow 5-4 split. According to the ASX’s rate tracker, markets still priced in a 57% chance of another increase in May. “The domestic data flow alone justified a rate hike today,” Commonwealth Bank’s Belinda Allen said. Reuters
Wednesday’s slide picked up momentum after Treasury weighed in. According to its estimates, if oil hovers close to $100 a barrel for the first half, the inflation peak could jump by 0.75 percentage point, and output would slip 0.2%. Stretch that out to $120 a barrel for longer, and the outlook gets rougher: inflation up 1.25 points, GDP down 0.6% by 2027.
The hit didn’t land evenly. Materials tumbled 9.01% this week, with health care off 5.05%, and information technology down 3.47%. By contrast, energy surged 6.15%, financials notched a 1.48% gain and consumer staples added 1.78%. Money didn’t exit equities entirely—it shifted toward oil producers and defensive names.
BHP dropped 1.82% and Rio Tinto shed 2.93%, but Woodside managed a 1.01% gain, the ASX price data showed Friday.
Offshore markets didn’t offer much relief. Global shares slipped for a third consecutive day on Friday. Brent finished up at $112.19 a barrel—its highest level since July 2022. Bond yields pushed higher as investors wagered that central banks could keep policy tight for an extended stretch.
Australia’s latest labour figures failed to lift sentiment. February payrolls climbed by 48,900, yet unemployment edged up to 4.3%. “Slightly weaker on the headline measures,” was My Bui’s verdict at AMP. Harry McAuley from Oxford Economics Australia pointed instead to risks around the “severity and length” of potential oil and gas disruptions in the Middle East. Reuters
The market’s stuck with few options heading into next week. High crude prices? Energy keeps propping up the index, but everyone else still faces pricier fuel, stickier rate expectations, and a fading risk mood. Should oil drop, rate jitters might fade along with it—although the shelter trades from this week may not stick around long.
