The ASX Today: Markets fall as US Fed revives rate hike fears; Energy a lone bright spot

Good afternoon and welcome to The ASX Today, I’m Seja Al Zaidi. The Australian share market has slipped half a per cent today, as investors reacted to a hawkish surprise from the U.S. Federal Reserve. Traders are now betting interest rates could rise again before the end of the year.

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Markets have moved quickly to price in a largely possible U.S. rate hike by October, sending technology and growth stocks lower.

Locally, the biggest casualty has been technology. WiseTech is down 3.4 per cent, and Xero has lost 3.2 per cent as investors move away from rate-sensitive growth names.

The banks have also lost momentum: NAB is down 1.5 per cent, Westpac has fallen 1.4 per cent, and the Commonwealth Bank is off 0.6 per cent.

Materials are also weaker, with gold miners under pressure as interest rate expectations weigh on bullion prices. Westgold Resources has dropped 3.3 per cent, and Ramelius Resources is down 3.2 per cent.

One bright spot is energy. Woodside has gained one per cent despite oil prices pulling back overnight. Elsewhere in the green, Challenger is slightly higher after its funds management arm, Fidante, agreed to merge with Channel Capital, creating a group with around $150 billion in assets under management.

Washington H. Soul Pattinson has risen 1.8 per cent after striking an almost $2 billion deal to sell its stake in Brickworks’ industrial property trusts to Goodman Group, freeing up capital for future investments.

And in the red, infrastructure investor Infratil is down 1.3 per cent after announcing former Woolworths chief Brad Banducci will join its board – his name doesn’t seem to spell good news for a company’s share price!

So, after several sessions dominated by optimism around easing geopolitical tensions, the Oz market is once again focused on interest rates. And right now, the message from the Fed is clear: The fight against inflation may not be over yet – and that could eventually mean more hikes in the future.

That’s all for The ASX Today. I’ll see you tomorrow.

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