The S&P/ASX 200 fell 0.6% to 9,148 on Tuesday, pulling back from the record high reached in the previous session as intensifying tensions in the Middle East stoked inflation concerns in Australia. RBA Governor Michele Bullock cautioned that an oil price shock stemming from the conflict involving Iran could reignite domestic inflation, noting that the recent exchanges between Iran and the US were a timely reminder of how quickly global conditions can change. The central bank unanimously raised the cash rate by 25 bps to 3.85% at its first meeting of 2026, its first increase since November 2023, in response to renewed cost pressures in the second half of 2025.
Energy stocks were mixed: Woodside Energy slipped 0.9% and Santos lost 0.6%, while Ampol advanced 2%, Whitehaven Coal climbed 3.3%, and Viva Energy rose 2.6%. Gold miners also lagged, with Newmont Corporation, Northern Star Resources, and Evolution Mining declining between 3.6% and 4.2%.
