Australian shares tumble as Mideast conflict, strong GDP growth stoke inflation worries

Mar 4, 2026, 13:32 GMT+7
Key points:

• ASX200 marks worst session since February 6
• ASX volatility climbs to over 10-month high
• Banks log worst day in three-and-a-half months
• NZ50 posts third straight session of losses

By Kumar Tanishk
Reuters - Australian shares logged their worst session in nearly a month on Wednesday in broad-based selling, as unexpectedly strong economic growth data and the widening Middle East conflict stoked inflation concerns.
The S&P/ASX 200 indextumbled 1.9% to a three-week closing low of 8,901.20. Earlier in the day, it slipped as much as 2.2%.
The benchmark has fallen more than 3% so far this week and is set for its biggest weekly drop since late March 2025.
The widening conflict in the Middle East threatens to unleash a fresh wave of global inflation, as crude oil prices have surged sharply.
This has pressured equities worldwide, with South Korea's KOSPI indexplunging more than 11% on Wednesday in its worst session since April 2000.
In Australia, the S&P/ASX 200 volatility index (. AXVI ) soared 13.7% to its highest level since mid-April last year, as robust economic growth in the December quarter stoked concerns about inflation.
"In the next few months, we will continue to see pretty heightened volatility," said My Bui, an economist at wealth manager AMP, adding that a U.S. midterm election year tended to be "very volatile historically, and that might flow through to the Australian market".
Markets are now pricing in a 33.4% chance of a quarter-point rate hike at the Reserve Bank of Australia's meeting on March 17, up from 28% just a day earlier.
Bui still argued that the central bank would likely hold off until clearer signals emerged, saying there was "no smoking gun" for an immediate rate hike.
In Sydney, financialsdropped 1.9% in their weakest session in three-and-a-half months. CBAfell 1.2%, while the remaining "big four" banks dropped between 1.6% and 3.7%.
Minersfell 3% after iron ore prices slid. BHP, Rio Tintoand Fortescuedropped between 1.6% and 3.5%.
Gold minersdeclined 3.9%, while consumer staples and discretionary stocks lost 2.1% and 1.2%, respectively.
In New Zealand, the benchmark S&P/NZX 50 indexfell 0.7% to 13,531.12 in its third straight session of declines

Sumber : Reuters