Financials, miners drag Australia shares lower; inflation data in focus

Australian shares closed lower on Monday, led by losses in miners and financials, while caution prevailed ahead of a crucial domestic inflation reading due later in the week that will likely provide cues on the central bank's rate easing policy.

The S&P/ASX 200 index closed 0.8 per cent lower at 7,733.7 points. The benchmark clocked its biggest intraday percentage loss since June 11.

Investors keenly await May's consumer price inflation, due on Wednesday, as the Reserve Bank of Australia resorted to a hawkish hold in interest rates and also reiterated that it was open to hikes in the future due to sticky inflation.

"Any upside surprise (for May CPI), even marginally, could become the final straw to trigger an even tighter monetary policy set-up for the foreseeable future," said Hebe Chen, market analyst at IG Markets.

Interest rate-sensitive financial stocks dropped 0.6 per cent, with the "Big Four" banks down between 0.3 per cent and 1 per cent.

Miners lost 1.5 per cent to mark their lowest level since Nov. 2022 as iron ore prices tumbled due to demand concerns in top consumer China.

Majors BHP Group, Rio Tinto and Fortescue declined between 0.1 per cent and 0.8 per cent.

Healthcare firms followed suit to drop 1.6 per cent, with sector leader CSL Ltd giving up as much as 0.9 per cent. The sub-index logged its worst session since May 17.

Depository shares of U.S.-based ResMed Inc lost 13.2 per cent.

"The healthcare sector is shaken by the tumble of sleep apnoea device manufacturer ResMed, whose core market is under serious threat from the advent of weight-loss drugs," Chen added. Energy stocks fell 1.9 per cent to their worst session since May 1, after crude oil prices extended losses.

Woodside Energy and Santos dropped 2 per cent and 1.6 per cent, respectively. New Zealand's benchmark S&P/NZX 50 index fell 0.5 per cent at 11,627.86 points at the close of the trade.