ASX snaps three-day slide as Trump tariff backflip sparks risk-on rally

Australian shares rose 0.8% to 8848.7, snapping a three-day losing streak as global risk appetite improved.

Markets largely ignored the hotter jobs print (65,200 jobs added, unemployment 4.1%) and instead chased cyclicals.

Energy and banks led gains, with Santos up 5.3% and major lenders rebounding strongly.

“While such a shift in rate expectations would typically weigh on the ASX 200, the market brushed it off today like water off a duck’s back,” said IG market analyst Tony Sycamore.

Investor sentiment lifted after Donald Trump signalled tariffs on European allies would not proceed, easing fears of a fresh trade shock.

The shift triggered a rotation out of defensives such as gold and into growth-linked sectors, mirroring rallies across Europe and Wall Street.

“Markets aren’t rallying because they understand the endgame in Greenland, they’re rallying because uncertainty just got priced out,” said IG market analyst Tony Sycamore.

The ASX move formed part of a broader Asia-Pacific rebound as volatility ebbed across global markets.

Stronger oil prices and firmer yields reinforced leadership from energy stocks and financials locally.