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ASX 200 hits lowest level since Jan 20
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Benchmark posts biggest weekly loss since Sept
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NZ50 posts first weekly fall in six
(Updates to close)
By Echha Jain
Feb 10 (Reuters) - Australian shares fell on Friday to
post their first weekly drop in six, after the central bank
raised its core inflation outlook and indicated more tightening
ahead.
The S&P/ASX 200 index closed 0.8% lower at 7,433.70.
The benchmark posted a weekly fall of 1.6%, its biggest in more
than four months.
In a hawkish-sounding quarterly Statement on Monetary
Policy, the Reserve Bank of Australia (RBA) revised up its
forecasts for core inflation and wages growth and warned of
further increases in interest rates.
"The RBA might remain hawkish for a longer duration than
previously expected, and probably even the terminal rate may
tick higher than anticipated," said Kunal Sawhney, chief
executive officer at Kalkine Group.
"If inflation persists and central bank officials continue
with their hawkish commentary, it would be naturally feared that
economic growth may be hit over the near- to medium-term."
Investor sentiment was also hit by hawkish comments from
several U.S. Federal Reserve speakers on Thursday. Markets are
now awaiting U.S. inflation data, due next week, for clues on
further rate hikes.
Most sectors on the Australian bourse ended in negative
territory, with miners plunging 1.2% to be the biggest
laggards.
Sector heavyweights BHP Group , Rio Tinto and Fortescue Metals Group dipped between 0.3% and
2.3%.
Energy stocks dropped 1.7% as oil prices fell.
Santos and Woodside Energy shed 1.1% and 1.7%,
respectively. Top Australian power producer AGL Energy , which
posted its second-biggest half-yearly net loss and cut annual
profit outlook on Thursday, extended losses to hit its lowest
level since Nov. 1, 2022. The stock closed 2.4% lower.
Gold stocks tracked bullion prices lower and closed down 3.1%. Sector majors Newcrest Mining and Northern Star Resources fell 1.9% and 3.1%, respectively. New Zealand's benchmark S&P/NZX 50 index jumped 0.5% to 12,178.76. It, however, posted its first weekly fall in six. (Reporting by Echha Jain in Bengaluru; Editing by Subhranshu Sahu)
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