Evening Wrap: ASX 200 dumps 133 points as WBC and NAB tumble, Middle East conflict saps investor confidence again

The S&P/ASX 200 closed 133.7 points lower, down 1.51%.

The ASX 200 suffered its sharpest fall in seven weeks after the US intercepted Iranian attacks and launched retaliatory strikes on Iranian military sites overnight, abruptly extinguishing the optimism that fuelled Thursday's rally. The damage was concentrated in the big banks, but there were bright spots in critical and strategic minerals stocks.

Be sure to click/scroll through for the usual reporting of the major sector and stock-specific moves, the broker responses to them, as well as all the key economic data in tonight's Evening Wrap. Also, I have detailed technical analysis on the Nasdaq Composite and the S&P/ASX 200 in today's ChartWatch.

Let's dive in!

Markets

ASX 200 Session Chart

The S&P/ASX 200 (XJO) finished 133.7 points lower at 8,744.4, 1.5% from its session high and just 0.3% from its low. In the broader-based S&P/ASX 300 (XKO) advancers lagged decliners by a truly dismal 69 to 217 😭.

For the week, the XJO finished up 14.6 points or 0.17% higher — roughly in the middle of its weekly range, 1.4% from its intraweek low and 1.6% from its intraweek high. A whole lot of up and down for nothing! 🤦

Communication Services (XTJ) (+0.2%) was the only sector to finish in positive territory, anchored by a strong quarterly result from News Corp (NWS) (+2.6%) which drove positive read-throughs across the online classified names. NWS beat third-quarter revenue and EBITDA expectations, with Dow Jones the standout, driven by demand for market intelligence during recent geopolitical tensions. CAR Group (CAR) (+2.9%) and REA Group (REA) (+1.4%) were also firmer.

Information Technology (XIJ) (-0.8%) was the second-best major sector despite finishing lower, as gains in some names offset declines in the index's heavyweights. Life360 (360) (+2.9%) and Technology One (TNE) (+2.0%) both advanced — the latter on a Bell Potter upgrade to Buy from Hold.

WiseTech Global (WTC) (-4.6%) and Xero (XRO) (-0.6%) weighed on the sector, possibly on the back of a kick-back-up in risk-free yields as higher energy prices restoked fears of higher inflation. Benchmark government bond yields rose 5–10 basis points overnight and carrying through into local Aussie yields today. High P/E tech stocks with distant earnings tend to fare poorly in rising risk-free rate environments, as it means those earnings are more harshly discounted back to present day values.

The Gold Sub-Index (XGD) (-0.5%) proved relatively resilient against the broader rout — an unusual result on a day when oil rose, given the normal inverse relationship between energy prices and gold attractiveness. COMEX gold futures edged up 0.3% to US$4,725/oz in the Asian session, and precious metals appeared to be finding safe-haven demand of their own as the conflict reignited. Black Cat Syndicate (BC8) (+3.9%) and Catalyst Metals (CYL) (+1.7%) were both stronger.

Financials (XFJ) (-2.2%) and Real Estate (XPJ) (-2.2%) were the joint-worst sectors — both hammered by the same mechanism: Both sectors are bond-proxies — when risk-free yields rise, their income streams look comparatively less attractive, and capital rotates out accordingly.

ASX 200 (XJO) Financials Sector Index (XFJ) intraday chart

Within Financials, the major banks bore the brunt. Westpac (WBC) (-4.8%) went ex-dividend 77 cents fully franked, but even adjusting for that, the decline appeared outsized. National Australia Bank (NAB) (-2.9%), Commonwealth Bank (CBA) (-1.9%), and ANZ (ANZ) (-1.5%) all fell sharply. Wealth platform stocks were also caught in the selling — HUB24 (HUB) (-3.1%) and Netwealth (NWL) (-2.5%) both declined.

Within Real Estate, retail-exposed names bore additional pressure as fears over consumer spending capacity under rising cost-of-living conditions weighed on sentiment toward their tenant bases. Stockland (SGP) (-3.2%), GPT Group (GPT) (-3.1%), and Goodman Group (GMG) (-1.9%) were all lower.

Utilities (XUJ) (-2.0%) fell alongside Real Estate as another bond-proxy sector caught in the yield-driven selloff. Origin Energy (ORG) (-2.3%), APA Group (APA) (-2.0%), and AGL Energy (AGL) (-1.1%) were all weaker.

Energy (XEJ) (-1.6%) fell despite ICE Brent crude futures pushing back up 0.9% to US$101/bbl in Asian trade, having rebounded from a session low of US$96/bbl as news of renewed US-Iran fighting broke. Oil and gas names were broadly softer — Woodside Energy (WDS) (-1.4%) and Santos (STO) (-1.4%) both declined. Coal stocks also fell, with Whitehaven Coal (WHC) (-2.7%) the notable mover.

Uranium stocks extended their volatile week, tracking a 4% overnight fall in Cameco that reversed Wednesday's sharp gains. Deep Yellow (DYL) (-4.7%), Boss Energy (BOE) (-4.1%), Paladin Energy (PDN) (-3.5%), and NexGen Energy (NXG) (-3.4%) were all lower.

Health Care (XHJ) (-1.2%) continued its wretched run. CSL (CSL) (-1.7%) is now down more than 50% on a rolling 12-month basis — a stunning decline for arguably the most celebrated blue-chip stock of the past two generations. Healius (HLS) (-6.6%) was also sharply lower.

Materials (XMJ) (-1.0%) drifted lower as fears over slowing global growth and a higher diesel bill weighed on the sector, despite COMEX copper futures rising 1.7% to US$6.28/lb — their highest level since late January. BHP (BHP) (-1.0%), Rio Tinto (RIO) (-0.8%), and Lynas Rare Earths (LYC) (-2.5%) all fell.

Critical and strategic minerals stocks bucked the trend, however — Iperionx (IPX) (+7.2%), Alpha HPA (A4N) (+4.6%), Metals X (MLX) (+3.6%), and Develop Global (DVP) (+2.6%) were all stronger. Sandfire Resources (SFR) (+0.5%) also edged higher on the copper price lead.

ASX 200 (XJO) Materials Sector Index (XMJ) intraday chart

In other commodities moves, SGX Australian Premium Coking Coal futures rose 1.5% to $240.50/t and NdPr rare earth prices in China fell 1.0% to CNY 757,500/t — both in the Asian session. Australian spodumene concentrate gained 1.8% to US$2,830/t. COMEX gold futures added 0.3% to US$4,725/oz.

Today's best gainers in the ASX 300

Today's worst losers in the ASX 300

ChartWatch

Nasdaq Composite Index

Analysis

We found some supply last night. The candle and the volume tell you how motivated and how much.

• Black bodied candle with upward pointing shadow, below average OTR = “a bit of supply side motivation”

• Above average volume = some force behind it

Is it panic stations? 😱

Nope, look at all the stuff that’s come before it, i.e., the trends, price action and candles = 💪💪💪 for demand side control.

So, balance of probabilities (based on the balance of D vs S) remains consistent with D > S = P⬆️

MOTN.

Not always.

Anything can happen to further tip the D vs S equation towards D = S = P➡️, or if news warrants, to S > D = P⬇️.

As you know I don’t waste any of my valuable time trying to predict which scenario is about to occur, the answer is always: one of them will, and I’ll just monitor the trends, price action, candles and volume — and deal with it accordingly.

So, last evening's “developments” — which came after the Comp closed — are as important to me as: they will deliver another candle and volume combination for me to analyse. 🧐

But, I can’t analyse a candle-volume combination that doesn’t exist. I can only go on what I can see in the chart above = FRP.

(It's trend following, remember? If you want a prognostication, go ask a prognosticator! 🔮)

View

FRP (RP = Risk Position — it reflects my personal allowable capital allocation limit for my investments in US stocks. So 1/2RP is 50%, 2/3RP is 67% and FRP is 100% 🪣). I don't know what's going to happen next, only that right now, the chart above remains a picture of excess demand.

Key levels

There are no key supply zones to contend with. The old all-time high supply zone of 23722-24020 will likely act as a short term zone of demand, however the short-term trend ribbon (presently 24001-24493) is now the key zone of demand. If the price closes back below this range, the supply-side is very likely back in control of the Comp's price.

S&P/ASX 200 (XJO)

Analysis

Oh OTP, you've done it again! You've snatched defeat from the jaws of victory. 🤦

50% in cash ain't looking too bad at all. ⚖️

View

I remain 1/2RP 🪣 on the OTP. (i.e., my personal allowable capital allocation limit for my investments in Australian stocks is 50%).

Key levels

9022 is the key point of supply. Beyond that, it's the 9201, the all time high. 8621 is now the critical point of demand. It's quite simple now: as long as the OTP stays above 8621, the rally that started at 8262 has some credibility. Below it = 🌵!

(Glossary of acronyms! Old Tin Pot (OTP): S&P/ASX 200 | MOTN: More Often Than Not | FOMO: Fear Of Missing Out | HOFU: Holding On For Upside | BTD: Buy The Dip | STR: Sell The Rally | RP: Risk Position)

Economy

Today

• There weren't any major economic data releases in our time zone today

Later this week

Friday

• 22:30 USA April Non-Farm Payrolls

  • Employment change: +60,000 forecast vs +178,000 in April

  • Average Hourly Earnings: +0.3% m/m forecast vs +0.2% m/m in March)

  • Unemployment Rate: unchanged at 4.3% forecast

Saturday

• 00:00 USA April Preliminary University of Michigan Consumer Sentiment (49.3 forecast vs 49.8 in March)

Latest News

Interesting Movers

Trading higher

• +11.7% Light & Wonder (LNW) - rebounded after five brokers including Citi, Macquarie, Morgan Stanley, and Ord Minnett retained buy-equivalent ratings following Thursday's quarterly result, with RBC maintaining an Outperform rating and $190 price target despite the 3% EBITDA miss.

• +10.2% Resolution Minerals (RML) - presented at the Mar-a-Lago Defence Forum, positioning its Antimony-Tungsten-Gold Project in the US as a critical minerals opportunity amid rising strategic minerals demand.

• +6.5% SKS Technologies (SKS) - secured a $22 million contract to supply and install an integrated electrical technology solution for a major retailer's new Melbourne Docklands headquarters, and separately announced a $20 million increase in bank facilities to support growth.

• +4.8% Block Inc (XYZ) - raised its full-year profit forecast to US$2.91 billion, representing 19% year-on-year growth, after first-quarter adjusted EBITDA of US$1 billion exceeded the US$947 million estimate

• +2.0% Technology One (TNE) - Bell Potter upgraded to Buy from Hold.

• +1.6% Pengana International Equities (PIA) - enlisted Antipodes Partners to manage its global equities portfolio in a bid to address its persistent discount to net tangible assets.

• +1.4% REA Group (REA) - March quarter revenue rose 6% to $398 million and EBITDA climbed 11%, with Citi attributing a modest 3% EBITDA miss to revenue timing issues in its residential business rather than weaker underlying demand; buy yield rose 14% in line with forecasts.

Trading lower

• -14.2% Tabcorp (TAH) - Jefferies downgraded to Hold from Buy with a price target cut to $0.93 from $1.25, and JPMorgan downgraded to Underweight from Neutral with a target cut to $0.80 from $0.90, both following AUSTRAC's disclosure of a money laundering and terrorism financing investigation.

• -2.1% Ramsay Health Care (RHC) - majority-owned European subsidiary Ramsay Santé reported nine-month revenue growth of 1.9%, below expectations, and a net loss of €27.9 million, though Citi said the earnings impact on the parent is likely to be only marginal.

• -1.6% QBE Insurance (QBE) - trading update reaffirmed FY26 guidance including a ~92.5% combined operating ratio and mid-single-digit premium growth, but flagged approximately US$60 million in claims exposure linked to the Middle East conflict.

• -1.1% Macquarie Group (MQG) - full-year profit rose 30% to $4.85 billion with second-half profit 17% ahead of consensus, but the stock fell despite the beat; Citi's Thomas Strong said the result is expected to trigger FY27 forecast upgrades given management's initial guidance implied modest upside to current expectations.

Broker Moves

ARN Media (A1N)

• Retained at sell at UBS; Price Target: $0.20

Atlas Arteria (ALX)

• Upgraded to hold from trim at Morgans; Price Target: $4.22

Amcor Plc (AMC)

• Retained at buy at Citi; Price Target: $75.00

• Retained at outperform at Macquarie; Price Target: $72.00 from $84.63

• Retained at buy at Morgans; Price Target: $65.40 from $68.20

• Retained at buy at Ord Minnett; Price Target: $63.00 from $66.00

Autosports Group (ASG)

• Retained at buy at UBS; Price Target: $4.90

BHP Group (BHP)

• Downgraded to hold from outperform at CLSA; Price Target: $55.50 from $59.50

• Retained at hold at Morgans; Price Target: $54.90 from $53.80

Beacon Lighting Group (BLX)

• Retained at buy at Bell Potter; Price Target: $2.05 from $2.85

Beach Energy (BPT)

• Retained at sell at UBS; Price Target: $1.00

Credit Corp Group (CCP)

• Retained at buy at Morgans; Price Target: $19.15 from $19.35

CSL (CSL)

• Retained at buy at UBS; Price Target: $205.00

Deterra Royalties (DRR)

• Retained at buy at Morgans; Price Target: $5.10 from $4.85

Fortescue (FMG)

• Retained at hold at Morgans; Price Target: $21.80 from $21.10

HMC Capital (HMC)

• Retained at buy at Morgans; Price Target: $4.05 from $3.40

Imugene (IMU)

• Retained at speculative buy at Bell Potter; Price Target: $0.25 from $0.82

Kelsian Group (KLS)

• Retained at buy at UBS; Price Target: $5.50

Light & Wonder Inc. (LNW)

• Retained at buy at Citi; Price Target: $140.00 from $160.00

• Retained at outperform at Macquarie; Price Target: $200.00 from $205.00

• Retained at overweight at Morgan Stanley; Price Target: $190.00

• Retained at buy at Ord Minnett; Price Target: $213.00 from $223.00

• Retained at buy at UBS; Price Target: $210.00 from $215.00

Magellan Financial Group (MFG)

• Retained at buy at Morgans; Price Target: $11.19 from $11.99

Minerals 260 (MI6)

• Retained at buy at Morgans; Price Target: $1.40 from $1.20

Macquarie Group (MQG)

• Retained at neutral at Citi; Price Target: $220.00

• Retained at neutral at UBS; Price Target: $235.00

Neuren Pharmaceuticals (NEU)

• Retained at buy at Bell Potter; Price Target: $22.00

NRW Holdings (NWH)

• Retained at buy at UBS; Price Target: $7.00

Origin Energy (ORG)

• Retained at buy at UBS; Price Target: $13.80

Orica (ORI)

• Retained at buy at Bell Potter; Price Target: $25.00 from $28.00

• Retained at buy at Citi; Price Target: $25.40 from $25.05

• Retained at buy at Jefferies; Price Target: $25.21 from $24.04

• Retained at overweight at JPMorgan; Price Target: $26.10

• Retained at outperform at Macquarie; Price Target: $25.86 from $25.40

• Retained at overweight at Morgan Stanley; Price Target: $28.00 from $27.00

• Retained at buy at Morgans; Price Target: $26.60 from $25.30

• Retained at buy at Ord Minnett; Price Target: $26.00 from $25.00

REA Group (REA)

• Retained at buy at Citi; Price Target: $199.00

• Retained at buy at UBS; Price Target: $209.00

Rio Tinto (RIO)

• Retained at hold at Morgans; Price Target: $160.00 from $156.00

South32 (S32)

• Retained at accumulate at Morgans; Price Target: $5.00 from $5.10

Scentre Group (SCG)

• Retained at neutral at UBS; Price Target: $3.85 from $3.80

Steadfast Group (SDF)

• Retained at outperform at Macquarie; Price Target: $4.80

Smartgroup Corporation (SIQ)

• Upgraded to buy from hold at Bell Potter; Price Target: $11.50 from $9.30

Santos (STO)

• Retained at buy at UBS; Price Target: $8.60

Super Retail Group (SUL)

• Retained at outperform at Macquarie; Price Target: $15.50 from $17.85

• Retained at hold at Morgans; Price Target: $11.51 from $12.90

Tabcorp Holdings (TAH)

• Downgraded to hold from buy at Jefferies; Price Target: $0.93 from $1.25

• Downgraded to underweight from neutral at JPMorgan; Price Target: $0.80 from $0.90

• Retained at buy at UBS; Price Target: $1.20

Telix Pharmaceuticals (TLX)

• Retained at buy at Bell Potter; Price Target: $19.00

Technology One (TNE)

• Upgraded to buy from hold at Bell Potter; Price Target: $31.75 from $31.00

• Retained at neutral at UBS; Price Target: $32.00

Woodside Energy Group (WDS)

• Retained at neutral at UBS; Price Target: $30.10

Whitehaven Coal (WHC)

• Downgraded to underperform from hold at CLSA; Price Target: $6.90 from $8.10

Zip Co (ZIP)

• Retained at buy at UBS; Price Target: $3.10

Scans