Local shares started the last session of the week in listless fashion reflecting the flat finish for US equity markets this morning.US participants reflected on a weaker round of economic news in the session, in the process capping gains for stocks. Additionally , Investors remained wary of taking on new positions ahead of a possible government shutdown as temporary funding expires. At the close the US Dow Jones was down by 98 points or 0.4%. The S&P 500 index was down 0.2%. And the Nasdaq was down by 2 points or less than 0.1%
Materials, Telecoms and Property Trusts were the ASX sectors that led the declines over the morning. Healthcare, Consumer Staples and Discretionary names were the leading improvers. Banks were weaker as a group. Participation saw around 2.7 billion transactions being measured by the ASX valued at $2.1 billion. At lunch 496 shares were higher, 632 were lower and 366 were unchanged.
The most improved names in the ASX 200 at lunch were Flight Centre (FLT) +6%, Speedcast International (SDA)+3.6%, Infigen Energy (IFN) +3.1%, and Qantas (QAN) +2.8%. The leading decliners in the index were Galaxy Resources (GXY) -8.4%, Pilbara Minerals (PLS) -7%, Mineral Resources (MIN) -6.3% and Orecobre (ORE) -6.1%,
Materials names were under pressure despite positive news flow in the last 12 hours. Metals prices have generally improved in northern hemisphere trade overnight after the latest data from China revealed slightly better than expect economic growth. The world’s second largest economy expanded at an annualised rate of 6.8% in the fourth quarter of 2017, a touch above forecasts of 6.7%. China’s economy grew 6.9% in 2017 year, up from 6.7% in 2016, marking the first calendar year of acceleration since 2010. China’s industrial production rose by 6.2% y/y in December, up from growth in November and forecasts of 6.1%. The acceleration in activity in 2017 would please Chinese authorities who made growth a priority in preparation for China’s National Party Congress late last year. Miners remained in a broad retreat over the morning continuing the theme of a day earlier. Fortescue Metals Group (FMG) was 3 cents or 0.6% lower at $5.11, South 32 (S32) bucked the weaker sector trend with a 2 cent or 0.4% gain of $5.10
Energy stocks were flat after registering a solid retreat yesterday. Oil prices remained pressure in early Asian trade despite the latest figures showing that US crude oil stockpiles fell to lowest level since February 2015 in the last week. Santos (STO) shares were recently at 4 cents or 0.7% lower at $5.17
Selling pressure remained a feature in the Lithium space on Friday, continuing the trend of a day earlier. Orocobre (ORE) shares resumed trade having been in a trading halt since Tuesday as the group raised money to fund an expansion of operations at the Olaroz project in Argentina. The initiative will take production capacity to 42,500 tonnes per annum (tpa) from 17,500 tpa originally. ORE claims this positions the company as one of the world’s largest and lowest cost lithium producers. ORE said today that it had raised more than $36 million through a capital raising, which included a $282 million strategic placement to a subsidiary of Toyota. ORE sahres were 8.5% lower a short time ago at $6.53 for a loss of 61 cents
Shares in Sydney Airport (SYD) were lower despite the group reporting record passenger movements for the airport in the last year. 43.3 million passengers though SYD’s terminals in 2017 an increase of 3.6% compared to 2016. International passenger numbers grew by more than one million, or 7.2% driven by capacity expansion in Middle Eastern, Asian and US routes. By comparison domestic passenger traffic grew 1.6% in 2017 contributing to a 3.5% rise in total passenger traffic. A short time agop SYD shares were at $6.70 for a loss of 5 cents or 0.7%.
Originally published by Tom Piotrowski – Market Analyst (Author) CommSec