The Australian sharemarket lost ground on Tuesday, with shares of the big miners and the energy sector weighing heavily on the equities benchmark. The S&P/ASX 200 Index dipped 23.9 points, or 0.3 per cent, to 7737.1.
“The market is braced for a weak number ... this would be seen by investors as mildly positive because it indicates the RBA’s tight monetary policy is working to slow the economy and ultimately reduce inflation.” However, a negative GDP number may spook the market and the RBA because that would point to a mild recession on the horizon, Kodari said.
Treasury yields also slid in the bond market after a report showed US manufacturing shrank in May for the 18th time in 19 months. Manufacturing has been hit hard by high interest rates meant to bring high inflation under control.