Australian shares closed lower on Tuesday, tracking Wall Street markets, ahead of the US jobs report due later that could shape interest rate cut guidance for next year.
The S&P/ASX 200 fell 0.4% or 36.1 points to close at 8,5983.9.
Economists expect payrolls to rise 50,000, along with a 4.5% unemployment rate, Bloomberg reported.
"We're likely facing a 'bad news is good' scenario for the jobs report," according to Chris Larkin at E*Trade from Morgan Stanley.
"As long as the numbers don't suggest employment is falling off a cliff, the markets may embrace soft data because it could lead to a more-dovish Fed," Larkin added.
On the domestic front, Australia's payment systems require resilience along with innovation as they become more complex, more digital, and more exposed to risks from outside Australia, said Reserve Bank of Australia's (RBA) Brad Jones.
The Reserve Bank of Australia (RBA) is expected to lift the cash rate by 0.25% in February 2026 to help bring inflation back under control, economists from the Commonwealth Bank of Australia said.
The Australian consumer sentiment index fell 9% to 94.5 in December from 103.8 in November, according to data from Westpac and the Melbourne Institute.
In company news, DroneShield (ASX:DRO) received a contract for AU$49.6 million from an unnamed European reseller for handheld counter-drone systems and associated accessories. Shares of the company rose 22% at market close.
Shares of REA Group (ASX:REA) fell 3% in recent Tuesday trade and earlier hit a 52-week low after multiple media reports on Monday said that Google appears to be running tests on adding real estate sale listings to its search results. Shares of the company fell 2% at market close and earlier hit a 52-week low.
Lastly, Star Entertainment Group (ASX:SGR) said Steve McCann will step down as Group Chief Executive and managing director effective Tuesday, and Bruce Mathieson will take on additional duties as Executive Chair while a search for a permanent CEO is conducted.
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