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A reversal in consumer and banking stocks helped the share market pare its first loss in five sessions as retail sales hit an all-time high.

The S&P/ASX 200 slashed an opening deficit of 97 points to 63 points or 0.94 per cent by the close.

The market came off its low as consumer staples and the heavily-weighted financial sector joined energy in positive territory. Real estate investment trusts were the biggest weight as more than two dozen firms traded ex-distribution. Gold miners and tech stocks were also notably weak.

What moved the market

Mixed signals on the health of the global economy kept investors on their toes. US stocks plunged overnight as a collapse in consumer sentiment raised questions about the outlook for corporate earnings. The S&P 500 sank 2.01 per cent after the Conference Board’s closely-watched consumer confidence measure fell to its lowest in 16 months.

“Although Wall Street indices opened on a strong note, they were not able to hold on to opening gains after the consumer confidence reading declined to its lowest level in more than a year in June. Rising prices of gas and food drove the decline,” Kunal Sawhney, chief executive of research group Kalkine, said.

“We believe consumer confidence could continue to decline as long as inflation remains elevated. US Fed’s decision on the interest rate and market direction will also depend on inflation readings.”

Pressure on Australian stocks eased as record retail sales suggested recent interest rate increases have yet to bite. Turnover increased 0.9 per cent this month, according to the Australian Bureau of Statistics. This month’s improvement was the fifth in a row.

Also helping sentiment was a modest rebound in US equity futures after last night’s bloodshed. S&P 500 futures firmed six points or 0.16 per cent this afternoon.

Investors will get another insight into the health of the US economy with the release of GDP data tonight and consumer prices tomorrow night. A new quarterly corporate reporting season next month will reveal how well American businesses are handling inflationary pressures and labour issues.

“The next few weeks will help paint a clearer picture about how corporates are dealing with a decline in discretionary consumer spending when the first round of corporate earnings will be released,” Sawhney said.

Winners’ circle

A late-morning recovery in some of the banks lifted the index off its lows. ANZ firmed 0.94 per cent, Westpac 0.96 per cent and NAB 1.01 per cent. Commonwealth Bank lost 0.58 per cent.

Woodside Energy climbed 0.43 per cent to a two-week peak. Santos faded 0.53 per cent.

News that an offtake agreement with Ford will underpin a lithium project in WA lifted Liontown Resources 5.16 per cent. Liontown will supply the US automotive giant with up to 150,000 dry metric tonnes of lithium per annum from its Kathleen Valley project.

Star Entertainment climbed 3.32 per cent on news Tyro Payments chief Robbie Cooke will join as CEO and Managing Director. Cooke has a long track record with ASX-listed companies, including Tyro, Tatts Group and Wotif.com.  

IGA operator Metcash firmed 1.67 per cent off the back of Monday’s well-received full-year result. Rail haulage firm Aurizon gained 3.17 per cent.

Coal miners New Hope and Whitehaven added 2.82 and 1.83 per cent, respectively.

Doghouse

The REIT sector shed nearly 4 per cent as around 30 trusts traded without the right to the latest distribution. A downgraded earnings outlook for the sector from Morgan Stanley added to pressures. The broker reduced its forecasts for FY24 and FY25, citing higher rates and hedging costs.

Charter Hall Long Wale dropped 7.33 per cent, Centuria Industrial REIT 6.27 per cent and Stockland 6.85 per cent. Goodman gave up 4.16 per cent.

Gold miners tracked a two-week low in the yellow metal. Silver Lake Resources wilted 8.15 per cent, Evolution 6.98 per cent and St Barbara 6.63 per cent. Newcrest lost 3.93 per cent.

Other notable heavyweight declines included CSL -1.55 per cent, Wesfarmers -1.09 per cent and Telstra -1.02 per cent.

The unexpected departure of CEO and Managing Director Robbie Cooke drove payments firm Tyro down 16.67 per cent to an all-time low. Cooke led the company for five years, guiding the firm through listing in 2019. Cooke will join Star Entertainment Group (see above).  

Carsales.com declined 9.55 per cent after raising $842 million from investors to help fund the purchase of Trader Interactive. The Australian classifieds outfit will pay $1.172 billion to acquire the 51 per cent of the US platform it does not already own.

Other markets

A negative session on Asian markets saw the Asia Dow lose 0.97 per cent, China’s Shanghai Composite 0.82 per cent, Hong Kong’s Hang Seng 1.76 per cent and Japan’s Nikkei 0.93 per cent.

Oil declined ahead of tonight’s OPEC+ policy meeting. Brent crude eased 56 US cents or 0.5 per cent to US$117.42 a barrel.

Gold bounced US$1.70 or 0.1 per cent to US$1,822.90 an ounce.

The dollar dipped 0.07 per cent to 68.99 US cents.

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