Australian shares have ended lower, with mining stocks in particular impacted by the ongoing uncertainty following the surprise announcement last week that the US will impose tariffs on imported steel and aluminium.
The benchmark S&P/ASX200 index was down 0.6 per cent at 5,895.0 points at 1630 AEDT on Monday, with resource and banking stocks deep in the red.
Macquarie Private Wealth division director Martin Lakos said the US decision to consider tariffs on steel and aluminium and possibly target European automotive imports is leading investors into new stages of uncertainty.
“The market is obviously rattled – no-one knows if it will stop at steel and aluminium – and that’s amplifying uncertainty and is keeping investors on edge,” Mr Lakos said.
Mr Lakos said it was no surprise the resources sector was impacted, albeit from a “sentiment perspective rather than harsh reality.”
Following US President Donald Trump’s floating of a 25 per cent steel import tariff, the price of iron ore has touched two week lows, with BHP Billiton down 1.8 per cent at $29.11, Rio Tinto falling 1.5 per cent to $75.73, and Fortescue Metals retreating 3.3 per cent to $4.75.
BlueScope Steel, Australia’s biggest steel maker closed 35 cents, or 2.2 per cent lower, at $15.95.
With Mr Trump also flagging a 10 per cent tariff on aluminium, ASX-listed Alumina Limited which invests globally in bauxite mining, refining and in aluminium smelting through its partner Alcoa, was up 1.8 per cent at $2.28.
The big four banks were lower, with Westpac down 1.2 per cent, Commonwealth Bank shedding 0.9 per cent, ANZ dropping 0.6 per cent and National Australia Bank giving up 0.5 per cent.
With production now halted for up to two months at Oil Search and Santos’ earthquake-damaged liquefied natural gas interests in Papua New Guinea, their shares were down 0.4 and 0.6 per cent, respectively.
Shares in the Retail Food Group closed 74.5 cents, or 36.5 per cent lower, to $1.295 – a nine-year low after emerging from a trading halt during which the company revealed an almost $90 million first-half loss and said it will close up to 200 stores.
Meanwhile, despite a small lift in the Australian dollar following better-than-expected building approval and company profits data from the Australian Bureau of Statistics on Monday, the local currency is slightly softer against the greenback, in line with falling commodity and iron ore prices.
At 1630 AEDT on Monday, the Australian dollar was worth 77.49 US cents, up from 77.61 US cents on Friday.
ON THE ASX:
* The benchmark S&P/ASX200 index closed down 33.9 points, or 0.57 per cent, at 5,895.0 points
* The broaderAll Ordinaries index was down 32 points, or 0.53 per cent, at 5,996.4 points
* The SPI200 futures contract was down 28 points, or 0.47 per cent, at 5,884.0 points
* National turnover was three billion securities traded worth $5.2 billion
CURRENCY SNAPSHOT AT 1700 AEDT:
One Australian dollar buys:
* 77.51 US cents, from 77.61 on Friday
* 81.85 Japanese yen, from 82.11 yen
* 62.93 euro cents, from 63.21 euro cents
* 56.22 British pence, from 56.27 pence
* 107.33 NZ cents, from 106.70 cents
The spot price of gold in Sydney at 1200 AEDT was $US1,326.31 per fine ounce, from $US1,318.31 per fine ounce on Friday.
BOND SNAPSHOT AT 1630 AEDT:
* CGS 4.50 per cent April 2020, 1.9676pct, from 1.9530pct on Friday
* CGS 4.75pct April 2027, 2.6882pct, from 2.6792pct.
Sydney Futures Exchange prices:
* March 2018 10-year bond futures contract at 97.27 (implying a yield of 2.73pct), from 97.28 (2.72pct) on Friday
* March 2018 3-year bond futures contract at 97.925 (2.075pct), from 97.930 (2.070pct).
(*Bond market closes taken at 1630 AEDT previous local session; currency closes taken from 1700 AEDT previous local session)