ASX 200 Has a Tough Wednesday Session

• ASX 200 has a tough Wednesday.
• Woolworths Group gives extraordinarily poor forward guidance.
• Global economy continues to cause ripples throughout the Australian index.

During the trading session on Wednesday, we saw the ASX 200 plummet to test the 50 Day EMA. This is a market that has been very bullish until recently, and now it is threatening to form a bit of a “head and shoulders pattern.” That being said, there is plenty of support underneath and of course there are a lot of questions asked about whether or not you should be shorting any of the global indices, let alone Australia as central banks around the world are cutting rates. With this being said, many traders seem willing to step in and pick this market up underneath, so it’s very possible that we may see a “buy on the dip” mentality.

That being said, many of the large corporations in Australia had a tough session, and therefore it was expressed on the chart of the ASX 200. The losses could have been attributed to the local CPI numbers coming out weaker than anticipated, as the CPI quarter over quarter came in at 0.2%, instead of 0.3% expected by traders, while the CPI year-over-year was 2.1%, well under the expected 2.3% by the market.

Westpac Banking Corporation (WBC)

Westpac Banking Corporation dropped 71c during the trading session but is still up two thirds of a percent for the month. For the year, WBC has been on fire, gaining 55.39% as the financial giant continues to be a major influence on the ASX 200. It’s worth noting that the stock is sitting right around the AU$32 level, and of course has an earnings announcement on Monday, with an expected earnings estimate of AU$1.002 per share, and a revenue estimate of AU$10.934 billion. As things stand at the moment, volume is relatively calm in this market.

Woolworths Group Ltd (WOW)

Woolworths Group dropped a massive 6.1% during the trading session on Wednesday and is now down 7.84% for the month. For the year, Woolworths Group has dropped 12.52%, as the consumer Staples giant has taken quite a beating. The supermarket giant sold off quite drastically on high-volume after a forward guidance downgrade, as the food giant suggests that perhaps things may get better in the back half of 2025, but as things stand right now, the shock sent ripples through the market.

RIO Tinto Ltd (RIO)

RIO Tinto sold off during the trading session on Wednesday, losing 65c, continuing to add to the loss over the last month. Over the last month, RIO lost 5.6%, while the yearly return has been a gain of 2.32%. The materials giant will continue to see a lot of volatility due to the commodities markets being in a state of flux, and of course the idea that the global economy may be slowing down will continue to cap the upside.

All things being equal, the market is sitting in the middle of the larger consolidation area, and it is worth noting that the 200 Day EMA sits just below the Wednesday lows. The AU$117 level continues to be interesting for buyers, as it has offered a certain amount of support over the last couple of weeks.

Disclaimer: The material provided here has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research we will not seek to take any advantage before providing it to our client. No representation or warranty is given as to the accuracy or completeness of this information and therefore it shouldn’t be relied upon as such. Any research provided does not have regard to specific financial situations, needs or investment objectives. Vantage accepts no responsibility for any use that may be made of these comments and for any consequences that result. Consequently, any person acting on it does so entirely at their own risk. We advise any readers of this material to seek professional advice where necessary. Without the approval of Vantage, reproduction or redistribution of this information isn’t permitted.