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The ASX suffered its biggest setback since the sugar hit from the Federal Budget, retreating 1.5 per cent before a partial recovery following accusations of electoral interference in the US.
All 11 sectors flashed red as the S&P/ASX 200 sank to its lowest level in eight sessions. The index touched 6101 before trimming its fall to 38 points or 0.6 per cent by mid-session at 6154.
What’s driving the market
Down-pressure from a negative night in the US was compounded by sliding US index futures after authorities accused Iran and Russia of attempted interference in the US election. Director of US National Intelligence John Ratcliffe said both countries had obtained voter information. Separately, the Washington Post reported the government had concluded Iran was behind threatening emails sent to Democrat politicians.
“We have confirmed that some voter registration information has been obtained by Iran and separately by Russia,” Ratcliffe said at a briefing. “This data can be used by foreign actors to attempt to communicate false information to registered voters that they hope will cause confusion, sow chaos and undermine your confidence in American democracy.”
S&P 500 futures tanked 20 points or 0.6 per cent. Dow futures dropped 163 points or 0.58 per cent.
The ASX was already under pressure following weak overnight leads and a surge in the dollar. The S&P 500 eased 0.22 per cent as will-they-won’t-they stimulus games continued in Washington. The Dow shed 0.35 per cent and the Nasdaq 0.28 per cent.
Hopes for a convincing break of the stubborn 6200 technical resistance level on the ASX 200 have faded over the last week as US stimulus talks dragged on and the Reserve Bank kept its cards close to its chest ahead of next month’s policy meeting. Instead the market found itself struggling to hold above 6100.
Going up
Winners were scarce on a morning when the best of the sectors (consumer staples) fell 0.2 per cent. Rio Tinto was the strongest performer on the S&P/ASX 20 index of market heavyweights with a rise of 0.4 per cent. BHP and Woolworths overcame early weakness to inch up 0.1 per cent.
A well-received trading update lifted health services provider Healius 6.5 per cent to its strongest level in more than two years. The company reported an increase in first-quarter revenue to $492.5 million from $419 million over the same period last year.
Oz Minerals lifted 3.8 per cent to a level last seen in April 2011 after raising its gold production guidance and chopping cost guidance. Auckland International Airport edged up 2.4 per cent as the company talked up property opportunities during the long recovery from Covid-19.
Going down
Energy was the morning’s worst performer, diving 2.1 per cent as Woodside reported a slump in revenue and investors sniffed at record production at Santos. Shares in Woodside fell 1.8 per cent after the industry giant reported a 42 per cent decline in last-quarter sales. Santos shed 1.6 per cent despite lifting production 22 per cent from the previous quarter and raising sales revenue 2 per cent to US$797 million.
The big four banks lost between 0.7 and 1.4 per cent. Goldminer Newcrest dropped 0.2 per cent, Fortescue Metals 1.3 per cent and toll road operator Transurban 2.3 per cent.
Buy now pay later company Z1P dropped 4 per cent to $6.81 on news Westpac had sold its stakes in the company. The banking giant offloaded 55.2 million shares at $6.65 to institutions after forming a partnership with rival Afterpay. Shares in Afterpay fell 1.4 per cent as the tech sector sank 1 per cent.
Beleaguered wealth manager AMP fell 4.5 per cent on news of a 0.3 per cent decline in assets under management last quarter due to outflows. Confirmation of ongoing challenges in the retail property market helped send Mirvac down 2.4 per cent.
Other markets
Asian markets paced the fall in US futures. China’s Shanghai Composite shed 0.3 per cent, Hong Kong’s Hang Seng 0.2 per cent and Japan’s Nikkei 0.5 per cent.
Oil fell with other risk assets. Brent crude shed 17 cents or 0.4 per cent at $US41.56 a barrel. Gold gave up $7.80 or 0.4 per cent to $US1,921.70 an ounce.
The dollar extended overnight gains, rising 0.04 per cent to 71.07 US cents.
What’s hot today and what’s not:
Hot today: Online marketplace Mydeal.com.au (ASX:MYD) hit the boards with a splash, briefly doubling in value on strong demand for one of the hottest floats of the year. Shares priced at $1 hit $2.20 before trimming their rise to 83 per cent at $1.83. The company raised $40 million in its initial offering, valuing the business at $258.8 million before launch. MyDeal focuses on household goods, including furniture and homeware.
Not today: News of a 19 per cent decline in gold production last quarter due principally to industrial action in Mali sent shares in Resolute Mining (ASX:RSG) down 8 per cent. Production at the company’s Syama mine in Mali was dented by industrial action and a coup in August. Resolute assured shareholders the outlook had improved with an interim government in place, supply links re-open and a deal in place with striking miners.
