Australian Shares Slide Ahead of Release of Domestic Inflation Data

Australian shares were down on Tuesday ahead of the release of domestic inflation data due out on Wednesday.

The S&P/ASX 200 Index retreated 13.30 points, or 0.2%, to 8,071.20.

CommBank Research said Australia's monthly CPI indicator is poised to show inflation eased in July.

The CPI indicator is expected to fall to 3.4% per year in July from 3.8% per year in June, with the key drivers of the decline being the partial introduction of 2024/25 energy bill relief as well as expected disinflation in volatile items, according to CommBank Research.

Meanwhile, IG market analyst for Australia Tony Sycamore expected headline inflation in July to fall to 3.3% and annual trimmed mean to ease to 3.7%, edging closer to the Reserve Bank of Australia's inflation target of between 2% and 3%.

"The expected step down in inflation partially explains why the Australian interest rate market is currently pricing in 30 basis points of RBA rate cuts by year-end and a cumulative 77 basis points of cuts by May 2025," Sycamore added.

In company news, Coles Group (ASX:COL) reported Tuesday that its earnings per share in the 12-month period ended June 30 rose to AU$0.835, compared with the prior-year period's AU$0.821. Shares of the supermarket chain closed 2% higher Tuesday.

BHP Group (ASX:BHP) reported Tuesday that its earnings per share in the 12-month period ended June 30 fell to $1.555, compared with the prior-year period's $2.547. Shares of the mining giant rose more than 1%.