Meta description: Australian stocks rallied on December 12, 2025, with the ASX 200 climbing on miners, gold producers and big banks. Here’s what’s driving the move, the biggest movers, and what analysts forecast for 2026.
Australia’s share market is finishing the week with a decisive risk-on tone. By midday in Sydney, the S&P/ASX 200 was up about 1.1% (around 8,685 points) — its strongest daily rise in roughly 2–3 weeks — led by materials and financials while technology lagged . [1]
Under the surface, it’s the same theme investors have been trading globally: rotation out of expensive growth/tech and back into cyclical “value” areas , with a commodity tailwind — particularly gold’s sharp overnight move to about US$4,274/oz — giving Australian miners an extra boost. [2]
Market snapshot: what’s happening on the ASX right now
Here are the headline moves shaping Australia stocks on Friday, December 12, 2025 :
- ASX 200: +1.1% at ~8,685 around midday AEDT (and ~+1.2% around 8,692 in earlier live readings) [3]
- Sector leaders:Materials and Financials ; Tech the key laggard [4]
- Australian dollar: roughly US$0.6667 [5]
- Commodities watch: spot gold near US$4,274/oz , iron ore about US$106/t , Brent crude around US$61–62/bbl in live market snapshots [6]
Market breadth has also improved notably. By late morning, one widely followed market feed reported 164 ASX 200 constituents (about 82%) trading higher — a classic sign of a broad-based “relief” rally rather than a narrow bounce. [7]
Why Australian shares are rallying: three forces at work
1) Gold (and broader metals) reads the fuse
Gold miners are a meaningful swing factor for the ASX on days like this — and gold did the heavy lifting. ABC’s market wrap noted gold surged roughly 2% overnight to around US$4,274/oz , before easing slightly in Asian trade. [8]
That move quickly fed through to big gold names:
- Newmont up about 5%
- Northern Star up about 2%
- Evolution Mining up about 3–4% [9]
Meanwhile, offshore, metals strength has been a recurring headline: one morning market wrap highlighted copper and silver pushing into fresh record highs while gold also firmed. [10]
2) Big banks rebounded as “value” demand returned
Banks often behave like a market stabilizer in Australia — and Friday’s tape looked like investors stepping back into financials after recent weakness.
Live sector commentary:
- Financials were up about +1.5% , described as bouncing off 7‑month lows [11]
- The Big Four were broadly higher in ABC’s afternoon check-in (CBA leading) [12]
This rotation matters for the benchmark, because banks carry enormous weight in the index and can “pull” the ASX even when other sectors chop around.
3) Global rate expectations turned into a tailwind — again
Overnight in the US, markets leaned into the view that policy is shifting toward easier settings. Reuters reported the US dollar headed for a third straight weekly drop as investors weighed the Federal Reserve’s outlook and the prospect of further cuts ahead. [13]
On Wall Street, that translated into a familiar pattern: materials and financials up, tech softer , with the S&P 500 posting a record close in the same dynamic rotation. [14]
Australia is plugged into that narrative through the currency, global risk appetite, and commodity pricing — which is why ASX leadership on Friday looks so “old economy.”
Top ASX movers: who’s winning and losing on Dec 12
Standouts on the upside
Across market live blogs, the leaders were dominated by materials-linked names:
- Boss Energy topped the ASX 200 gainers in one afternoon snapshot (+7% range) [15]
- Gold-related and materials names were repeatedly listed among top gainers (eg, Genesis Minerals , Newmont , Emerald Resources , Alcoa ) [16]
The laggards
A few consumer and energy names appeared among the weaker performers in live tallies:
- Metcash was flagged near the bottom of the ASX 200 movers in one snapshot [17]
- Santos appeared among the weaker names earlier in the session [18]
The index-level story: materials leadership is back
One intraday market note summed up the day neatly: Materials (+1.71%) hit record highs , and Financials (+1.54%) rebounded strongly, while much of the recent month’s pain had been concentrated in financials, discretionary, telcos and tech . [19]
Big corporate and policy headlines moving “Australia stocks” today
Market days like this aren’t just about price action — they’re also about the story flow investors will digest into the weekend. Several headlines stood out on Dec 12 .
Tomago Aluminum: government deal to keep the smelter open beyond 2028
One of the most closely watched industrial policy stories this morning: the Prime Minister announced a deal is being finalized to keep Tomago Aluminum operating beyond 2028 , after the company flagged rising energy costs threatened long-term viability. [20]
Why markets care:
- Tomago is majority owned by Rio Tinto (via its ownership structure) [21]
- The facility employs 1,000+ people and produces close to 40% of Australia’s annual aluminum output [22]
- SBS added that Tomago is Australia’s single largest electricity user and consumes about 10% of NSW power supply , underlining why energy policy is central to its economics [23]
The deal’s full financial details weren’t disclosed in the public reporting at the time, but officials described it as a long-term power purchasing arrangement intended to deliver energy security and competitiveness. [24]
Austal and Hanwha: foreign investment approval with strict conditions
Another headline feeding into the defense/industrial complex: Reuters reported Australia would not oppose Korea’s Hanwha nearly doubling its stake in Austal to 19.9% from 9.9% , but under strict conditions related to data access and security , and criteria around any board nominees. [25]
Austal’s trading was even paused after the decision, according to Reuters, underscoring how material the announcement was for the stock. [26]
ABC’s coverage noted Austal said it would weigh the “opportunities and risks” of any partnership or board position request, including sensitivities around national security discussions. [27]
ANZ: former CEO launches legal action over bonus cuts
In the banking sector, Reuters reported former ANZ CEO Shayne Elliott filed legal action alleging the lender breached his departure contract after bonuses worth A$13.5 million were stripped, while ANZ said it would defend the matter. [28]
Investors typically watch these stories for governance implications — particularly in a market where bank valuations and regulatory scrutiny are never far from the narrative.
Westpac AGM: investor protest vote and “ASX ties”
Reuters also reported this week that Westpac director Peter Nash was re-elected but faced a sizeable protest vote (about 40% voting against ), partly linked to concerns about his ties to the Australian Securities Exchange during a period of operational and governance issues. [29]
Macro and rates: why the RBA is still the key swing factor for 2026
Australian equity multiples — especially banks and rate-sensitive cyclicals — are being priced off one question: is the next RBA moving down, or could it be up?
What the RBA said this week
In its December 9, 2025 decision statement, the RBA held the cash rate at 3.60% and warned that while inflation has fallen substantially since 2022, it has picked up more recently , with signs that part of the pickup could be broader-based and persistent enough to “bear close monitoring.” [30]
What economists are forecasting
A Reuters poll (published Dec 5) said economists expected the RBA to hold at 3.60% in December and — notably — keep it there through 2026 , a shift versus the prior month when more economists had expected at least one cut next year. [31]
ABC’s labor-market coverage this week also noted market pricing for a February hike had risen after unemployment remained at 4.3% , even as participation slipped — highlighting how sensitive expectations are to each data release. [32]
2026 forecasts: where analysts see the ASX heading next
Forecasts differ in detail, but the “base case” across major market commentary has a few consistent themes: moderate index gains, materials strength, and big questions about bank valuations .
Morgan Stanley: ASX 200 target 9,250 in 2026; materials rotation “intact”
In a published summary of Morgan Stanley’s outlook, the bank’s team set a 2026 target of 9,250 for the ASX 200, framing it as a 10–12% total return scenario with ~10% earnings growth after several years of weak earnings growth. [33]
A key call: materials could be the engine of that return, supported by an above-consensus metals view and a weaker US dollar backdrop. [34]
On banks, Morgan Stanley’s view in the same outlook was that the sector may underperform in 2026 after a significant re-rating, leaving valuations elevated by historical standards. [35]
IG: ASX 200 could reach 9,300–9,500 by end-2026, but valuations are “lofty”
IG’s 2026 outlook (published Dec 10) highlighted that the ASX 200 was trading around 8,600 with a ~5.39% calendar-year gain at the time of writing, and flagged that the market’s forward P/E near 18.1x was above its long-term average. [36]
IG’s technical view projected a potential move into the 9,300–9,500 zone by the end of 2026 (with caveats), and argued the materials sector looked a strong contender to outperform given commodity signals and valuation support. [37]
Morningstar on banks: households “in good shape,” but credit growth likely modest
In a December 2025 industry landscape update cited by ABC, Morningstar argued households are in a stronger position than pre-COVID (including higher offset balances and fewer high LVR loans), suggesting loan losses may remain within historical averages. [38]
That same analysis anticipated mid-single-digit credit growth over the next five years and projected bank net interest margins averaging ~1.85% by 2027 , not far from fiscal 2025 levels — a set of assumptions that tend to support stability rather than a blowout boom. [39]
What investors are watching next week
For anyone following Australian stocks into year-end, the next catalysts are less about one company and more about whether the macro narrative stays supportive:
- Inflation prints and “sticky” components (especially housing-related inflation, which the RBA has been monitoring closely) [40]
- Labor-market updates , after a week where the same jobs data was read as both “still tight” and “softening under the hood” [41]
- Commodity volatility , particularly gold and industrial metals, given how quickly materials leadership returned on Dec 12 [42]
- Bank valuation sensitivity , as strategists debate whether 2026 is a year of continued strength or a de-rating risk [43]
Bottom line
On December 12, 2025 , the Australian share market’s bounce looks less like a random Friday pop and more like a global rotation trade expressing itself through the ASX’s natural leadership: banks and miners , with gold providing an unusually strong kicker.
The bigger question for 2026 is whether the market can extend gains from here while:
- valuations remain elevated ,
- the RBA remains hawkish , and
- commodities do enough heavy lifting to offset any slowdown in domestic cyclicals. [44]
References
1. www.abc.net.au, 2. www.abc.net.au, 3. www.abc.net.au, 4. www.marketindex.com.au, 5. www.reuters.com, 6. www.abc.net.au, 7. www.marketindex.com.au, 8. www.abc.net.au, 9. www.abc.net.au, 10. www.marketindex.com.au, 11. www.marketindex.com.au, 12. www.abc.net.au, 13. www.reuters.com, 14. www.reuters.com, 15. www.abc.net.au, 16. www.abc.net.au, 17. www.abc.net.au, 18. www.abc.net.au, 19. www.marketindex.com.au, 20. www.abc.net.au, 21. www.abc.net.au, 22. www.abc.net.au, 23. www.sbs.com.au, 24. www.abc.net.au, 25. www.reuters.com, 26. www.reuters.com, 27. www.abc.net.au, 28. www.reuters.com, 29. www.reuters.com, 30. www.rba.gov.au, 31. www.reuters.com, 32. www.abc.net.au, 33. www.livewiremarkets.com, 34. www.livewiremarkets.com, 35. www.livewiremarkets.com, 36. www.ig.com, 37. www.ig.com, 38. www.abc.net.au, 39. www.abc.net.au, 40. www.rba.gov.au, 41. www.abc.net.au, 42. www.abc.net.au, 43. www.livewiremarkets.com, 44. www.ig.com
