Index Update: Australian shares ended lower on Friday as the S&P/ASX 200 slipped 44.00 points, or 0.50%, to close at 8,796.70. The decline was driven by broad weakness in mining stocks, with heavy selling in BHP and a series of softer operational updates weighing on investor sentiment. Falling gold prices also added further pressure on resource-linked companies.

Despite the overall market pullback, seven of the index’s 11 sectors finished higher, highlighting pockets of resilience across the market. Utilities was the strongest-performing sector, rising 1.77% on the day and gaining 1.44% over the past five sessions, followed by gains in Energy (+1.66%), Telecommunications Services (+1.62%), and Consumer Staples (+1.06%).

Among the weakest sectors, Materials fell 2.91%, while Information Technology declined 1.60% and Health Care slipped 0.34%. The biggest laggards within the S&P/ASX 200 were 4DMedical Limited and Mesoblast Limited, which dropped 15.57% and 11.91%, respectively.

The benchmark index remained largely unchanged over the past five trading days and on a year-to-date basis, as investors balanced defensive sector strength against continued pressure on mining and growth-oriented stocks.

Macro Update: The global economy faces renewed risks if the Strait of Hormuz conflict is not resolved within weeks, International Energy Agency Executive Director Fatih Birol warned. He said markets remain nervous amid uncertainty over potential disruptions to oil, natural gas, fertilizer and other shipments through the key waterway. The IMF also cautioned that global economies have limited capacity to absorb further energy supply shocks. However, the conflict’s impact has remained smaller than expected as energy prices avoided a sharp surge.

Top Market Movers: The top three gainers were AMP Limited (ASX:AMP), which rose AUD 0.120 or 6.315% to AUD 2.020, Brambles Limited (ASX:BXB), which gained AUD 0.650 or 3.459% to AUD 19.440, and Woodside Energy Group Ltd (ASX:WDS), which advanced AUD 0.970 or 3.289% to AUD 30.460. The biggest decliners were 4DMedical Limited (ASX:4DX), down AUD 0.590 or 15.568% to AUD 3.200, Mesoblast Limited (ASX:MSB), which dropped AUD 0.330 or 11.914% to AUD 2.440, and Megaport Limited (ASX:MP1), which fell AUD 1.690 or 8.484% to AUD 18.230.

Commodity Update: The U.S. dollar remained broadly steady on Friday but was set for a weekly decline after softer-than-expected U.S. inflation data reinforced expectations that the Federal Reserve may delay further interest rate increases. However, escalating military tensions between the United States and Iran continued to support demand for safe-haven assets and kept market sentiment cautious. Gold declined 0.21% to USD 3,987.65, silver dropped 1.53% to USD 55.33, copper eased 0.51% to USD 13,492.50, while Brent crude oil gained 0.80% to USD 84.88 on supply disruption concerns.

Our Stance: Australian equities ended the week on a weaker footing as losses in the Materials sector outweighed gains across most other industries. Mining stocks remained the primary drag, reflecting softer commodity sentiment and company-specific operational updates, while defensive sectors including Utilities, Energy and Consumer Staples provided support. Investors also continued to monitor global macro developments, particularly geopolitical risks around the Strait of Hormuz, although energy markets have so far remained relatively stable. Looking ahead, market direction is likely to remain influenced by commodity price movements, corporate earnings updates and evolving global economic and geopolitical conditions, with sector rotation expected to remain a key theme.

The S&P/ASX 200 edged lower by 44.00 points in the latest trading session, forming a bearish candlestick that reflects cautious investor sentiment. Despite the marginal decline, the broader technical outlook remains constructive, with the index continuing to trade comfortably above its 50-day Simple Moving Average (SMA), which is acting as a key dynamic support level and reinforcing the prevailing medium-term uptrend. Immediate support is positioned around 8,730, and maintaining this level would help preserve the broader bullish structure while supporting the potential for further upside. A sustained rebound from this support zone could pave the way for a retest of the recent highs and potentially extend the ongoing rally. Conversely, a decisive break below 8,730 would weaken the near-term technical outlook, increase selling pressure, and raise the likelihood of a deeper corrective phase.