ASX closes flat; ASIC to probe market operator

The Age

16-06-2025

But it was uranium play Paladin Energy that took out the top spot, up more than 15 per cent to $7.28.
Among the miners, Rio Tinto advanced 0.7 per cent, BHP added 0.3 per cent.
The laggards
The financial sector finished the day 0.1 per cent weaker, while materials stocks faded 0.9 per cent due to weakness in large cap miners and as gold retreated from within striking distance of all-time highs after spiking when the air strikes began late last week.
The big banks were mixed, with Westpac shares losing 0.5 per cent and ANZ Bank falling 0.1 per cent, while National Australia Bank gained 0.2 per cent and Commonwealth Bank edged up 6¢ to $179.41.
Shares in ASX Limited fell 6.7 per cent after the Australian Securities and Investments Commission (ASIC) announced it would conduct a wide-ranging inquiry into the markets operator after a series of failures at the company.
'ASX operates Australia's critical markets infrastructure. Investors and market participants deserve to have absolute confidence that ASX is operating soundly, securely and effectively,' ASIC chair Joe Longo said.
The inquiry follows the failure of a major ASX technology project to replace infrastructure. The project was junked in 2022 after extensive delays, to the frustration of brokers and other market participants.
Gold miners predominantly traded lower, with Northern Star dropping 8.2 per cent and Evolution Mining losing 8 per cent despite the rise in gold prices over the weekend, as the surging oil price put pressure on extraction and transport costs.
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Gold was steady near a record high as the escalating conflict drove investors towards haven assets. The precious metal erased gains made earlier on Monday to trade close to $US3430 an ounce, about $US70 short of an all-time peak in April.
The lowdown
Investors struck a cautious tone and are bracing for a volatile week amid fears over the conflict in the Middle East.
'With Iran striking back after Israel's attacks, and the US mulling involvement, investors are bracing for further market impact from the conflict,' Moomoo market strategist Jessica Amir said.
'A broad risk-off mood is taking hold, as oil, defence and gold rise.'
And with no end to the Middle East conflict in sight, there are concerns crude prices could go higher.
While Iran only produces roughly 3.5 per cent of global crude supply, there are fears it could close the Strait of Hormuz, the primary route for multiple OPEC producers, IG Markets analyst Tony Sycamore said.
'The knock-on impact of higher energy prices is that they will slow growth and cause headline inflation to rise,' he said.
'While central banks would prefer to overlook a temporary spike in energy prices, if they remain elevated for a long period, it may feed through into higher core inflation as businesses pass on higher transport and production costs.'
The Middle East conflict adds complications to what was already set to be a busy week. The Federal Reserve and the Bank of Japan are among a raft of central banks set to announce interest rate decisions, while a meeting of the Group of Seven leaders also threatens to add volatility.
Four major central banks, including the US Federal Reserve, are broadly expected to keep policy rates on hold when they meet this week, but the rising oil price and any resulting inflation could further restrict their ability to cut interest rates in the months ahead, which in turn weighs on companies' ability to invest in growth.
'Markets should be prepared for a prolonged period of uncertainty,' said Wolf von Rotberg, an equity strategist at Bank J. Safra Sarasin.
On Wall Street, the S&P 500 sank 1.1 per cent and wiped out what had been a modest gain for the week. The Dow Jones Industrial Average dropped 769 points, or 1.8 per cent, and the Nasdaq composite lost 1.3 per cent.
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Past attacks involving Iran and Israel have resulted in prices for oil spiking initially, only to fall later 'once it became clear that the situation was not escalating and there was no impact on oil supply', according to Richard Joswick, head of near-term oil at S&P Global Commodity Insights.
That has Wall Street waiting to see what will come next. US stock prices dropped to their lowest points for the day after Iran launched ballistic missiles towards Israel.
For now, the price of oil has jumped, but it's still lower than it was earlier this year. 'This is an economic shock that nobody really needs, but it is one that seems more like a shock to sentiment than to the fundamentals of the economy,' said Brian Jacobsen, chief economist at Annex Wealth Management.
That in turn sent US stocks to a loss that was notable in size but outside their top 15 for the year so far.
Companies with some of the sharpest losses were those that use a lot of fuel as part of their business and need their customers feeling confident enough to travel. Cruise operator Carnival dropped 4.9 per cent, United Airlines sank 4.4 per cent, and Norwegian Cruise Line Holdings fell 5 per cent.
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They helped overshadow gains for US oil producers and other companies that could benefit from increased fighting between Israel and Iran.
Exxon Mobil rose 2.2 per cent, and ConocoPhillips gained 2.4 per cent because the leaping price of crude oil portends bigger profits for them.
Contractors that make weapons and defence equipment also rallied. Lockheed Martin, Northrop Grumman and RTX all rose more than 3 per cent.