ASX Falls as Banks and Miners Lead the Decline

Staff reporter Updated January 20, 2026 — 1:41pm,first published January 20, 2026 — 7:28am You have reached your maximum number of saved items. Remove items from your saved list to add more. Save this article for later Add articles to your saved list and come back to them anytime. Mining and bank shares weighed on the Australian sharemarket, after European shares slumped as trade tensions between the US and Europe flared over US President Donald Trump’s push to take control of Greenland. The S&P/ASX200 fell 49.8 points by early afternoon, down 0.6 per cent, to 8824.70, as the broader All Ordinaries lost 55.2 points, or 0.6 per cent, to 9139.7. Five of the market’s 11 sectors were weaker, with real estate, miners, banks and energy companies all losing ground. The iron ore giants all fell, with BHP shedding 2 per cent, Rio Tinto falling 1.6 per cent and Fortescue losing 0.9 per cent. BHP provided a production report, saying it produced about 69.7 million tonnes of iron ore in its second quarter, up 5 per cent on the same period a year ago, and reaffirming its annual production guidance. It has also been a soft day for bank shares, with Commonwealth Bank (down 1.5 per cent), Westpac (down 0.8 per cent), National Australia Bank (down 1.1 per cent) and ANZ Bank (down 1.2 per cent) all trading in the red. Investment giant Macquarie Group also lost 1.2 per cent. Advertisement Financial services business AMP lost 1.3 per cent after it said chief executive Alexis George was retiring, to be replaced by AMP’s finance chief Blair Vernon. George has led AMP since 2021 during a period of major change, as the company sought to rebuild and refocus after it had a bruising experience during the 2018 royal commission into financial misconduct. Origin Energy gained 2 per cent after it said it would keep the nation’s biggest coal-fired power plan, Eraring, running until 2029 instead of 2027, following fresh warnings that the electricity grid is under-prepared to manage its imminent retirement without worsening the threat of blackouts. Overnight, European shares mostly fell and US stock futures pointed to falls on Wall Street’s next session, after Trump at the weekend threatened to slap a 10 per cent extra tariff on imports from eight European countries because they oppose having America take control of Greenland. Germany’s DAX lost 1.3 per cent, the CAC 40 in Paris fell 1.9, and Britain’s FTSE 100 declined 0.4 per cent. US stockmarkets were closed for Martin Luther King Jr Day, futures pointing to a 1 per cent fall in the S&P 500. Advertisement On the ASX, futures pointed to a decline of 0.4 per cent or 34 points when the market opened, after the bourse declined 0.3 per cent on Monday. The European countries targeted by Trump blasted his threat to raise tariffs, saying they “undermine transatlantic relations and risk a dangerous downward spiral”. The unusually strong joint statement was the most forceful rebuke from the European allies since Trump returned to the White House almost a year ago. Trump’s moves are testing the strategic alignment and institutional trust underlying support from Europe, the largest trading partner and provider of financing to the US, Stephen Innes of SPI Asset Management said. “In a world where geopolitical cohesion within the Western alliance is no longer taken for granted, the willingness to recycle capital indefinitely into US assets becomes less automatic. This is not a short-term liquidation story. It is a slow rebalancing story, and those are far more consequential,” Innes said. Advertisement Trump’s threat to impose levies on countries opposing his bid to claim authority over Greenland risks reigniting the volatility that rattled markets in the early months of his second term. The sell-off deepened after European officials signalled they were unlikely to back down and were considering retaliation. “The nervousness is palpable,” said Alexandre Baradez, chief market analyst at IG in Paris. “All in all, you have so many issues piling up – from credit cards to the independence of the Fed and tariffs – that I really don’t see the case for stock markets to keep on breaching new records.” The stand-off is happening at a time when risk appetite has been supported by resilient earnings and sustained investment in artificial intelligence. The outlook will hinge in part on the European Union’s response, with the bloc in talks to impose tariffs on €93 billion ($161.3 billion) of US goods. French President Emmanuel Macron intended to request the activation of the EU’s so-called anti-coercion instrument, Bloomberg reported over the weekend. German leader Friedrich Merz, however, said on Monday that Germany’s heavier dependence on exports meant it was less willing to unleash the counter-measure. “The key element to watch in the coming days is whether the message translates into formal measures or remains purely rhetorical, which would make a clear difference in the market reaction,” said Francisco Simón, European head of strategy at Santander Asset Management. Advertisement You have reached your maximum number of saved items. Remove items from your saved list to add more. More: World markets Sharemarket