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The share market shed 100 points after Wall Street’s worst session since 2020 ensured the new month got off to a rocky start.

Tech and property stocks spearheaded losses as the S&P/ASX 200 fell 101 points or 1.36 per cent by mid-session.

The decline reversed Friday’s gain and pushed the index towards its fourth loss in six sessions.

What’s driving the market

A dire end to a challenging month on Wall Street gave the local market nowhere to go this morning but sharply lower. The S&P 500 slumped 3.63 per cent on Friday to a fresh 2022 low. The Nasdaq Composite plunged 4.17 per cent to a level last seen in 2020.

“It was a nasty end to the month for US equities with a nasty collapse in China’s PMIs on Saturday unlikely to arrest mounting concerns over a global growth slowdown. All this against a backdrop of rising inflation fuelling the notion central banks need to accelerate their policy nomalisation process,” NAB currency strategist Rodrigo Catril said.  

Soft forecasts from Apple and Amazon added to investor worries ahead of a week expected to produce rate rises on both sides of the Pacific. The Reserve Bank is expected to lift the cash rate tomorrow. The Federal Reserve is certain to follow a day later. The Bank of England is also expected to hike.

“This has become a classic trader’s market as spikes in volatility and increasingly bearish headlines reverberate,” Quincy Krosby, chief equity strategist for LPL Financial, told CNBC.

Rate-sensitive tech stocks led this morning’s sell-off, mirroring Friday’s US action. ASX tech slumped 4.12 per cent to an eight-week low. The tech-heavy Nasdaq fell 13.26 per cent last month, its worst return since the GFC.

Real estate investment trusts, which have historically done well during rate-hike cycles, skidded 3 per cent this morning. The decline again mirrored US action. Goodman Group was the biggest drag, falling 6.32 per cent as it prepared a US$500 million bond raising.

Going up

Qantas put on 2.68 per cent after projecting a return to profit next financial year and unveiling plans for direct flights to London and New York. The airline expects domestic earnings to be positive this quarter, paving the way to profitability in FY23 as international travel recovers. The company also announced it will buy 12 Airbus A350s capable of flying direct to western Europe and the eastern US.

Helloworld Travel firmed 1.88 per cent on news revenues bounced 52 per cent last quarter from the same period last year. The recovery helped the travel agent more than halve its loss to $1.9 million.

Rivals Flight Centre and Webjet responded with rises of 1.24 and 0.33 per cent, respectively.

Aside from Qantas and Flight Centre, just three stocks on the ASX 200 gained more than 1 per cent. Cromwell Property nudged up 1.75 per cent, Reliance Worldwide 1.26 per cent and GrainCorp 1.06 per cent.

Toll road operator Transurban firmed 0.49 per cent after reporting a sharp up-tick in traffic volumes across Easter. The company told today’s Investor Day that private transport usage had recovered close to pre-pandemic levels.

Mining investor Deterra edged up 0.22 per cent after royalty receipts increased 78.8 per cent last quarter to $59.1 million. Centuria Office REIT gained 0.91 per cent after reaffirming full-year guidance.

Going down

Growth stocks led the retreat as investors rotated out of stocks whose earnings are seen as most susceptible to higher rates. Pro Medicus sank 7.73 per cent, Xero 6.65 per cent and WiseTech 6.38 per cent. Codan gave up 6.04 per cent, Tyro Payments 5.78 per cent and Imugene 5.68 per cent.

Aussie Broadband dived 24.19 per cent as investors baulked at updated guidance. The telco expects active broadband connections to reach 580,000-585,000 by financial year-end. Earnings are expected to be $27-$28 million.

An earnings downgrade pushed AGL down 0.35 per cent following a generator fault at the Loy Yang power station in Victoria. The company downgraded full-year underlying earnings guidance to $1.23-$1.3 billion from a previous forecast of $1.275-$1.4 billion.

NAB was worst of the major banks, falling 1.21 per cent after entering an enforceable undertaking with AUSTRAC to improve compliance with anti-money laundering and terrorism financing laws. The undertaking requires the bank to formulate a remedial plan and address any deficiencies identified by the regulator.

Liontown Resources announced the completion of a lithium offtake agreement with LG Energy Solution. Shares in the miner eased 2.4 per cent.

Other markets

The Asia Dow fell 0.74 per cent. Japan’s Nikkei gave up 0.65 per cent. Trade in mainland China and Hong Kong was suspended for public holidays.

A mild rebound lifted S&P 500 futures five points or 0.12 per cent. Nasdaq futures bounced 0.35 per cent.

Gold began a new week on the back foot. The yellow metal skidded US$24.90 or 1.3 per cent to US$1,886.80 an ounce.

Oil also hit reverse. Brent crude declined US$1.38 or 1.3 per cent to US$105.77 a barrel.

The dollar receded 0.26 per cent to 70.4 US cents.

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