The share market shrugged off negative US leads to inch towards a positive close and an end to a run of four straight weekly losses.
The S&P/ASX 200 rose as much as 38 points in early action before paring its mid-session tally to three points or 0.1 per cent at 5886. The tepid rally kept the market on course to avoid a fifth straight weekly loss. The index needs to close above 5859 this afternoon to break a losing run that started in mid-August.
What’s driving the market
The early rally faltered amid signs overnight losses on Wall Street might extend into tonight’s action. The S&P 500 fell 0.84 per cent overnight but finished well above its session low. S&P 500 futures this morning faded eight points or 0.2 per cent. Dow futures sank 82 points or 0.3 per cent.
Today’s ASX rally trimmed a 1.2 per cent plunge yesterday when investors appeared to interpret unexpectedly strong August jobs data as market-negative because they diminished the need for central bank and government support. The economy created a seasonally-adjusted 111,000 jobs last month, pulling the official unemployment rate down from 7.5 per cent to 6.8 per cent.
“Obviously, markets want to see good news on the jobs front longer term… but I think investors took this as a sign that the RBA and the Federal Government may do less than previously expected to boost monetary and fiscal stimulus. So, in a perverse sort of way, the market sold off,” ThinkMarkets Market Analyst Carl Capolingua said.
Property stocks led this morning’s retreat. Unibail-Rodamco-Westfield shed 4 per cent, Abacus Property Group 3.2 per cent, Scentre Group 1.9 per cent and Dexus 1.8 per cent.
The financial sector slipped to a fresh 16-week low as rises of 2.3 per cent rise in Macquarie Group and 0.2 per cent in NAB were outweighed by falls of 0.7 per cent for ANZ, 0.5 per cent for CBA and 0.2 per cent for Westpac. AMP slipped 2.5 per cent as it traded without its dividend.
Going up
Tech stocks thumbed their nose at the Nasdaq’s 1.27 per cent dive. Afterpay rose 2.7 per cent, Megaport 2.2 per cent and Xero 1.8 per cent.
Iron ore miners rebounded from yesterday’s beating despite another decline in the ore price overnight. Rio Tinto climbed 2.1 per cent and BHP 1.4 per cent. Fortescue Metals edged up 0.8 per cent from yesterday’s seven-week low. The spot price for ore landed in China eased $2.25 or 1.8 per cent yesterday to US$122.05 a tonne.
Other gainers at the heavyweight end of the market included Newcrest +0.6 per cent, Telstra +0.4 per cent and Woodside Petroleum +0.3 per cent.
Going down
The top three industrials by market cap all declined. Toll road operator Transurban lost 1.7 per cent and supply-chain logistics specialist Brambles 1.4 per cent. Sydney Airport fell 0.1 per cent after August traffic data showed passenger traffic was 96.5 per cent lower than the same period last year.
The eight largest consumer staples companies lost ground. Coca-Cola Amatil gave up 2 per cent, Woolworths 0.5 per cent and Coles 0.6 per cent. Biotech giant CSL eased 0.9 per cent.
Other markets
The mood was positive on Asian markets. China’s Shanghai Composite put on 0.4 per cent, Hong Kong’s Hang Seng 0.3 per cent and Japan’s Nikkei 0.2 per cent.
Gold rebounded from last night’s 1 per cent loss, rising $9 or 0.5 per cent this morning to $US1,959 an ounce. Brent crude climbed six cents or 0.1 per cent to $US43.36 a barrel.
The dollar inched up 0.06 per cent to 73.18 US cents.
What’s hot today and what’s not
Hot today: The exchange operator’s speed camera got another workout this morning when copper explorer Coppermoly (ASX:COY) shot up 355.6 per cent in 48 minutes before the speed cops intervened. Momentum traders have kept the ASX busy this week with a string of extreme share price runs. The exchange has been getting quicker to intervene with trading pauses while baffled directors try to explain the sudden interest in their sleepy operations. East Energy Resources (ASX:EER) and Sagalio Energy (ASX:SAN) remained in halts pending explanations for runs of 1,100 per cent and 987 per cent, respectively, earlier in the week.
Not today: A flat outlook for orders weighed on shares in natural oils and infant formula manufacturer Clover Corporation (ASX:CLV). A 23.6 per cent lift in full-year net profit after tax to $12.5 million appeared to be overshadowed by news the company expects first-half orders to be the same as the equivalent period last financial year. The company also warned that a bump in retail demand for infant formula in the first half of the calendar year “may have been a ‘one-off’.” The share price fell 9 per cent.