In the week ending Friday 28 August 2026, the ASX 200 gained 33 points. In the same five days, the market roughly doubled the probability it assigns to an RBA rate rise next month. This ASX market update August 2026 is about that gap, because only one of those two facts will still matter in six months, and it is not the one in the headline.
Global markets
Global equities finished higher in a week that spent most of its length looking like it would not. Nvidia’s result on Thursday sent the stock up almost 9% and revived the AI trade across every semiconductor heavy market, while a retreat in long bond yields lifted the pressure that had been building on valuations. The S&P 500 closed at 7,711.76, up 0.5%.
| US Markets | % Change | Rest of the World | % Change |
|---|---|---|---|
| The Dow Jones | +0.5% | Nikkei 225 | +0.6% |
| S&P 500 | +0.5% | STOXX Europe 600 | flat |
| Nasdaq | +0.8% | Hang Seng | -1.6% |
The bond market was the quiet driver. The 30 year US Treasury yield briefly cleared 5.3%, territory last seen in 2007, before easing back to around 5.20% and finishing the week roughly eight basis points lower. That retreat is what allowed equities to rally on the Nvidia news rather than simply absorb it.
Asia split on the same information. Japan’s Nikkei 225 added 0.6% to 66,405.56 as the semiconductor complex rallied, while Hong Kong went the other way, the Hang Seng falling 1.6% to 25,584.79. South Korea’s Kospi dropped 1.79% on Friday alone. Europe finished flat but was not calm: the STOXX 600 had its worst session in a month on Thursday, driven by France, where the CAC 40 fell 1.7% to a one month low and BNP Paribas, Société Générale and Crédit Agricole each shed 4% to 5% on fiscal and political concerns. Brent crude fell more than 5% to near US$88 as Iran and Oman talks over the Strait of Hormuz stalled again, and gold eased to around US$4,600 an ounce.
The ASX
The ASX 200 closed at 9,092.3, up 0.4% for the week. That modest gain conceals the most consequential domestic development in months.
| Best 3 Movers | % Change | Worst 3 Movers | % Change |
|---|---|---|---|
| DTL | +18.6% | ABB | -13.7% |
| ANN | +17.4% | GDG | -16.0% |
| SLX | +16.6% | PXA | -17.5% |
Wednesday’s July inflation print ran hot. Headline prices rose 1.0% on the month against 0.8% expected, and the trimmed mean measure of core inflation rose 0.5%, its biggest monthly increase in a year and well above the 0.3% forecast. The annual headline pace did slow to 3.5% from 3.8%, but only because a large increase from last year dropped out of the base. The index fell 1.0% on Thursday to 9,038 before recovering 0.6% on Friday.
Reporting season drove the dispersion in individual names. Data#3 rose 18.6% after FY26 revenue of $917.4 million and net profit up 13.1% to $54.5 million. Ansell added 17.4% on record sales of US$2.14 billion and an expanded capital returns program, with Silex Systems third after reporting on 27 August. At the other end PEXA Group fell 17.5%, almost all of it in Friday’s session alone, after full year profit came in at $19.2 million against a $49.7 million forecast. Aussie Broadband fell 13.7% despite lifting underlying earnings 19.6%, and Generation Development lost 16.0% as brokers cut price targets.
The RBA did not meet this week, so the cash rate remains at 4.35% following the unanimous hold on 11 August. Markets now put the odds of a hike at the 28 and 29 September meeting at 36%, up from 17% before the inflation data, and price a 94% chance of at least one increase by February 2027.
Why base effects flatter and momentum tells the truth
The annual inflation rate fell to 3.5%. That reads as progress until you notice why it fell. A large increase from last year dropped out of the twelve month calculation, which lowers the annual number without anything improving in the present. Meanwhile the monthly trimmed mean, which strips out volatile items and is the measure the Board watches most closely, posted its biggest rise in a year.
Base effects flatter. Monthly momentum tells you what is actually happening. When the two point in opposite directions, the monthly number is the one that changes policy.
There is a second signal worth noting. Beneath Friday’s rally the breadth was poor: in the broader ASX 300, advancing stocks lagged decliners 134 to 143 even as the index closed at its session high. Financials had been sold in 13 of the previous 18 sessions and sat more than 10% below their August high before buyers returned. A market where the index rises while most stocks fall is not a market expressing confidence. It is a market where a few large names are doing the work.
The practical translation is straightforward. The cost of money in Australia is now more likely to rise than fall, and the market has only just begun pricing that. Long duration assets, leveraged balance sheets and anything valued on cash flows that arrive years out are the exposures worth examining first. The discipline is the one that has worked all year, and it is why we weight our private market and income strategies toward contracted cash flows: be paid properly for the time you are asked to wait.
Book a strategy call at barkerwealth.com.au to talk through how a higher-for-longer domestic rate path sits against your own positioning. You can also read last week’s market update or more about how we work with wholesale investors.
This commentary is intended for general information only and does not constitute personal financial advice. You should consider your own objectives, financial situation and needs before making any investment decisions. Barker Wealth Management Pty Ltd ABN 46 695 875 962, trading as Barker Wealth, holds Australian Financial Services Licence (AFSL) 700297. Your adviser is Joshua Barker (AR 1274752).