ASX dives 2.1pc as NAB, CBA, Westpac slammed

Traders abandoned bets of a rebound in retailers on Friday, dragging the ASX’s consumer discretionary sector to its worst day in more than 18 months.

On Friday, the S&P/ASX 200 fell 171.5 points, or 2.1 per cent to 7943.20, a day after hitting a record closing high of 8114.7. The All Ords also lost 2.1 per cent at 8170.4.

Discretionary retailers were the worst hit, falling 3 per cent for the first time since December 2022. Wesfarmers fell 2.9 per cent to $71.60 and Premier Investments dropped 2.2 per cent to $32.35.

The fall precedes the first batch of earnings from the sector next week, when Light & Wonder and Nick Scali will report results. JB Hi-Fi and Temple & Webster will report the following week.

The mood in the sector turned decidedly sour after overnight data suggested the US economy was softening, rekindling fears that still-high interest rates could result in a recession.

“The market is focusing on the last hiking cycles: once the Fed starts cutting, you might initially think it’s soft landing cuts, but that can quickly transform into emergency hard landing cuts,” said Luke McMillan, head of investment research at Ophir Asset Management.

All 11 sectors of the Australian benchmark ended in the red.

Uranium explorer Boss Energy was the biggest laggard on the main index, down nearly 13 per cent at $3.18.

Macquarie Group retreated 2.2 per cent to $206.70 as it flagged a potential hybrid issue.

The mining sector also came under pressure, with Rio Tinto sliding 0.8 per cent to $118.75, BHP 1.2 per cent to $41.98 and Fortescue 1.3 per cent to $18.75.

In the energy sector, Woodside shaved off 1.9 per cent at $27.48 and Santos shed 2.2 per cent at $7.86 even as oil prices recouped some lost ground.

Brent crude futures bounced 0.7 per cent higher to $US80.1 a barrel, and West Texas Intermediate crude added 0.7 per cent to $US76.88. Yet, oil prices were set for a weekly loss as signs of disappointing fuel demand growth outweighed fears of supply disruptions due to escalating tensions in the Middle East.

In the tech sector, Block Inc was among the rare outperformers, up 5.1 per cent at $100.10 after upgrading its full-year guidance and flagging a new $US3 billion ($4.6 billion) share buyback.

Financial software provider Iress lost 1.4 per cent at $10.40 as it completed the sale of its UK Mortgage sales business to Bain in a $167 million deal.

In other corporate news, sleep apnoea devices maker ResMed ended the session 1.8 per cent lower even as it posted higher revenue and dividends for the April-June quarter.

Property services business Johns Lyng Group eased 0.2 per cent on plans to acquire SSKB Strata and Chill-Rite HVAC for $57.6 million.