The S&P/ASX200 fell 20.9 points on Tuesday, down 0.24 per cent, to 8,604.2, as the broader All Ordinaries trimmed 31.1 points, or 0.35 per cent, to 8,824.8.
The top-200 reclaimed most of a more than 1.5 per cent drop in the morning as dip-buyers entered after NAB economists predicted the Reserve Bank's next move would be an interest rate cut.
"We no longer expect the RBA to hike by 25 basis points in August, and now see the cash rate peaking at the current rate of 4.35 per cent for the cycle," NAB chief economist Sally Auld wrote in a a research note.
"The next move in the cash rate is likely to be down, but the timing is uncertain."
Basic materials tumbled more than two per cent after gold fell into an official bear market on Friday, down more than 20 per cent from January's record peak after US figures dimmed hopes for Federal Reserve interest rate cuts in 2026, supporting the greenback.
"The strength of the US dollar has certainly been one of the issues for metals prices, and that might have been starting to have more of an impact on the broader market," Moomoo market strategist Michael McCarthy told AAP.
"I'm looking at these stocks, and these are the top-100 stocks and they're moving by two, three, four per cent - this is still a sign of an unstable market."
Mega miners BHP, Rio Tinto and Fortescue also stumbled under the weight of a higher greenback as iron ore and copper prices fell.
Of the top-200's 35 worst-performers, 34 were resource stocks.
As miners fell, heath care, consumer-facing, real estate and communications stocks rebounded as the day wore on, each segment gaining more than 1.2 per cent in broad, segment-wide rallies.
The boost to consumer-facing and real estate sectors came as NAB economists predicted the future RBA rate cut.
The heavyweight financials sector overcame its early trouble to end the day slightly better than flat, although NAB still fell a hefty 1.7 per cent to $35.96.
Energy stocks eased 0.2 per cent as oil tipped lower on reports Iran and Israel will pause strikes on each other for the time being, although uranium stocks couldn't escape the rout in metals prices.
In company news, oOh!media shares soared more than nine per cent after confirming a $765 million takeover bid from Bain Capital, going up against an existing offer from Pacific Equity Partners and I Squared Capital.
Shares in building material manufacturer James Hardie slipped more than 2.4 per cent after pledging to fight a class action lawsuit shareholders have launched over alleged continuous disclosure breaches.
The Australian dollar is buying 70.58 US cents, down from 71.25 US cents on Friday at 5pm, after the hawkish repricing for US interest rates supported the greenback.
ON THE ASX:
* The S&P/ASX200 lost 20.9 points, or 0.24 per cent, to 8,604.2Â
* The broader All Ordinaries fell by 31.1 points, or 0.35 per cent, to 8,824.8
One Australian dollar trades for:
* 70.58 US cents, from 71.25 US cents at 5pm AEST on Friday
* 113.06 Japanese yen, from 113.95 Japanese yen
* 61.15 euro cents, from 61.30 euro cents
* 52.83 British pence, from 53.03 British pence
* 120.94 NZ cents, from 121.43 NZ cents
