Mayank Bansal, CFA
Mayank Bansal is a CFA Charterholder and heads the Equity Research team at Kapitales Research, with over 5 years of experience analysing global equity markets. He leads fundamental, data-driven research combining rigorous financial analysis with macro trends.
ASX MARKET INSIGHT
Market Overview
The S&P/ASX 200 (XJO) slipped back on Thursday, shedding 38.10 points or 0.43% to settle at 8,793.20 and falling back beneath its 200-day moving average only a day after reclaiming it. The damage came from the resource and retail ends of the market: Energy, Materials and Consumer Discretionary each lost between 1.7% and 2.4%, more than offsetting modest gains in the other eight sectors. Furniture retailer Nick Scali was the heaviest faller in the index, down 15.34% after a profit downgrade, followed by Magellan Financial Group, down 9.52%.
The index never traded above Wednesday’s close of 8,831.30. It opened near 8,801, about 30 points lower, and sold off to about 8,773 by 10.25am. A bounce to about 8,791 just before 11am faded, and after an hour of sideways trade between roughly 8,781 and 8,790, the benchmark touched its session low near 8,770 just before noon, about 61 points under the prior close. Buyers then returned: the index climbed back through 8,790 by 12.30pm, crossed 8,800 around 1.30pm and twice reached about 8,807 in the 2pm hour. After easing to about 8,797, it made a final push to a session high near 8,808 at about 3.25pm, still some 23 points short of the previous close, before a late slide to about 8,789 at 3.45pm. It recovered to about 8,796 near 4pm, and the closing auction settled it at 8,793.20.
The intraday range was about 38 points, narrower than Wednesday’s 44. NextDC and Smartgroup led the index, gaining 7.48% and 5.42% respectively. The S&P/ASX 200 is still 0.84% higher over five sessions, down from 1.18% a day earlier, although the ASX now describes it as virtually unchanged for the year.
Sector breadth told a different story to the headline. Eight of the 11 sectors closed higher, the same count as Wednesday, but the three that fell are large or highly cyclical groups, and their losses were deep enough to pull the index down. Industrials led at +0.90%, followed by A-REIT (+0.76%), Telecommunication Services (+0.52%), Financial (+0.44%), Consumer Staples (+0.36%), Health Care (+0.08%), Utilities (+0.05%) and Information Technology (+0.01%). Energy was the weakest sector at −2.42%, with Materials (−1.96%) and Consumer Discretionary (−1.72%) also sharply lower. The best-to-worst spread narrowed to 3.32 percentage points from 5.55.
Rotation was again the theme: A-REIT and Information Technology, two of Wednesday’s three losers, moved back into positive territory, while Energy and Consumer Discretionary, both higher on Wednesday, dropped to the bottom of the board, and Materials posted a third straight decline. Across the broader exchange, decliners outnumbered advancers 585 to 435, a wider gap than Wednesday’s 560 to 478, and the All Ordinaries’ 0.44% fall was in line with the benchmark, pointing to broad selling rather than weakness in a handful of large names.
Key Drivers
Market Sentiment / Vibe
Thursday was a session in which offshore optimism failed to make it across the Pacific. Wall Street rallied overnight: the Dow gained 0.69% to 52,856.09, the S&P 500 rose about 0.6% to 7,758 and the Nasdaq climbed about 1.1% to 26,703, as SpaceX’s quarterly result revived appetite for AI and chip stocks. After the US close, Tesla’s third-quarter revenue beat estimates and Meta raised the low end of its 2026 capital spending forecast, while the US 10-year Treasury yield edged up about 3 basis points to 5.15%.
Locally, though, futures that had pointed higher proved misleading. The ASX opened 0.4% lower and stayed in the red all day as investors focused on bad news at home rather than US tech strength. Nick Scali’s warning on weak furniture demand fed concern about household spending, a day after RBA Deputy Governor Andrew Hauser said the inflation outlook was materially worse than forecast, keeping a November rate rise firmly in play. Domain’s report of a record 4.7% quarterly fall in capital city house prices added to the sense that higher rates are starting to bite.
Resources were the other drag: Fortescue’s stand-off with China’s state iron ore buyer weighed on the miners, and energy producers fell even as Brent pushed above US$111 on renewed Middle East supply fears. The mood was cautious rather than fearful: eight sectors still rose and buyers stepped in after the noon low, but with rate risk building and the resources complex under pressure, conviction was thin.
Sector Map | Heatmap
S&P/ASX 200 GICS sector performance at the closing bell. Eight sectors finished higher and three lower — Industrials was the best at +0.90% and Energy the weakest at −2.42%, a best-to-worst spread of 3.32 percentage points, down from 5.55 on Wednesday.
The Leaders & Laggards
Top 5 gainers and laggards from the S&P/ASX 200 universe at the closing bell.
Key Events
Commodity & Macro Watch
Data note — The Gold reading in the table above is published from Kapitales Research's own daily closing prices, and the daily move is measured between two consecutive stored closes. Figures for this indicator quoted elsewhere in this commentary are as written at the time of publication and may differ.
The Road Ahead
Our last wrap named 8,833–8,835 as the immediate hurdle and 8,817–8,820 as first support, followed by 8,800–8,803 and Wednesday’s 8,797 low, with 8,783–8,790 and then 8,763 in play on a break of 8,797. Thursday’s open near 8,801 skipped straight past first support, and the index fell through 8,797 within the first half hour, sliced through the 8,783–8,790 zone and reached about 8,773 by 10.25am. The noon low near 8,770 stopped short of 8,763, which held as the key floor. The afternoon recovery reclaimed 8,800–8,803 and stretched to about 8,808, but the late fade left the close at 8,793.20, back below the 200-day moving average and well short of the 8,817–8,820 zone.
Resistance now starts at 8,797–8,803, the opening level and old support, followed by 8,807–8,808, Thursday’s afternoon highs, then 8,817–8,820 and Wednesday’s 8,831 close. On the downside, 8,783–8,790, where the index held at 3.45pm, is first support, followed by the 8,770–8,773 late-morning and noon lows, then 8,763 and the 8,749 low. A close back above 8,808 would suggest Thursday’s fall was a one-day setback, while a break below 8,770 would bring 8,749 into focus.
The RBA cash rate is 4.60%, and the September-quarter CPI on 28 October remains the key domestic event before the 3 November Board meeting. Ingenia’s process deed talks with Warburg Pincus run to 23 October, global PMI data are due on Friday, Megaport’s quarterly update is expected around 29 October, and NextDC will outline its revised spending plans by its 20 November AGM. Fortescue’s negotiations with China Mineral Resources Group are now a live risk for the miners, with the company signalling that output could be adjusted if no agreement is reached by year-end. Offshore, the Federal Reserve meets on 27–28 October, and the reaction to Tesla’s and Meta’s results will set the tone for US tech. Brent is above US$111 and WTI near US$99, gold has slipped to about US$4,093/oz, and iron ore is holding near US$91 a tonne, still down about 15% for the year.
Two threads to carry forward. First, the consumer: Nick Scali’s downgrade, the broader weakness in retailers and Domain’s record fall in house prices all suggest higher rates are feeding through to household spending, which makes next week’s CPI a two-sided risk for Consumer Discretionary. Second, resources: Energy and Materials fell together even as oil rose, so the index’s ability to hold the 8,770–8,790 area is likely to depend more on whether miners and energy producers stabilise than on further gains in banks and industrials.
Note: All data presented is based on information available at the time of writing.
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