The S&P/ASX 200 index closed lower on 4 November 2025, falling 0.91% to 8813.70 points. This decline marked the index’s lowest level in over five weeks. Market participants reacted to the Reserve Bank of Australia’s (RBA) decision to hold the official cash rate steady at 3.6%. The RBA cited inflation within its target range and other economic pressures as reasons for maintaining rates. This decision followed three cuts earlier in the year.
Market Overview and Influences
The ASX decline reflected investor caution ahead of the RBA announcement and ongoing concerns about inflation control, cost pressures, and global economic uncertainty. Financial stocks, traditionally heavyweights on the ASX, remained under pressure. Westpac Banking Corporation shares edged up 1.51% to $40.42 despite reporting a fall in annual profits linked to rising costs and intense margin competition.
Westpac Banking Corp’s share performance
Mining and Energy Sector Performance
The mining and energy sectors experienced losses, contributing significantly to the broader market fall. Major miners slipped as commodity prices weakened. BHP Group shares retreated 1.59% to $42.67, while Rio Tinto’s stock dipped 2.49% to $129.54. Fortescue Metals Group shares fell 3.68% to $20.28. South32 and Mineral Resources shares decreased by 2.7% and 2.21%, respectively. Despite these daily losses, these companies showed gains over the past month, with South32 and Mineral Resources up 9.07 and 12.33%, respectively.
Rio Tinto Ltd’s share performance
Analyst Insights on Mining Stocks
Macquarie Group provided a neutral outlook on BHP and Rio Tinto shares, setting price targets that imply modest upside potential of 3.1 and 4.5%, respectively, over the next 12 months. The broker rated Fortescue, South32, and Mineral Resources with underperform ratings, highlighting downside risks. Commodity price movements in iron, copper, and thermal coal, which rose significantly year-on-year, underpin potential earnings improvements for these miners in 2026.
Top Market Performers of the Day
Among sectors showing gains, defence company DroneShield Ltd led with an 8.62% rise to $4.16. This rally followed a $25 million sales contract announcement. NextDC Ltd and Domino’s Pizza Enterprises Ltd also posted gains of 4.24 and 4.19% respectively, supported by solid operational momentum. Light & Wonder Inc and IPH Ltd climbed 3.54 and 2.97%, respectively, rounding out the top performing stocks.
DroneShield Ltd’s share performance
Market Sentiment and Economic Context
The market exhibited a flat to negative sentiment reflected in ASX futures showing neutral directional bias ahead of the RBA announcement. Investors weighed the interplay of domestic inflation, unemployment trends, rising household bills, and global economic conditions. The timing coincided with Melbourne Cup Day, leading to lower trading volumes and influencing market liquidity.
Also Read: Australia Exported Gas to Meet 22 Years of Demand in Just Five Years Amid Domestic Shortages
Sector Summary and Key Figures
Healthcare stocks were weak, led by declines in ResMed (down 4.3%) and Cochlear (down 2.1%). Financials broadly underperformed except for Westpac’s modest gains. The ASX 200 index has declined approximately 1.45% over the past month yet remains 8.56% above the prior year’s levels.
Future Market Outlook
Market analysts expect the ASX 200 to trade near 8762 points by the end of the quarter. The RBA Governor Michele Bullock’s scheduled post-announcement address provided further guidance on the Bank’s future policy stance. Investors remain cautious, awaiting further economic signals related to household cost pressures and international market conditions.
This session’s market movements underscore the continuing sensitivity of Australian equities to domestic policy settings and global commodity cycles. The cautious tone could persist as investors monitor inflation data and economic growth trajectories closely. The performance variance across sectors highlights the ongoing challenges and opportunities within the Australian market landscape.
