Losses from the banks and miners are pushing the Australian sharemarket lower for a fifth day, with the ASX 200 index slipping by 0.75 per cent. The Australian dollar strengthened following better than anticipated quarterly economic growth data.
Concerns relating to trade tensions between the US, Canada and China together with stronger US data contributed to a firmer greenback and softer commodity prices. Mining stocks are down by around 1.5 per cent.
BHP Billiton (BHP) has paid almost $50m to buy a 6.1 per cent stake in an Ecuadorian copper-gold mine. The miner will trade ex-dividend for its 85c/share dividend on Thursday.
Energy stocks are being pushed higher by gains from Santos (STO) which is up 1.4 per cent. Last night the price of oil edged higher modestly following a tropical storm which raised some production concerns in the US.
Transurban (TCL) has resumed trade after successfully raising $3bn to help pay for its WestConnex purchase from the NSW Government. TCL shares are down 1.7 per cent.
Amazon joined Apple as the second US$1 trillion company overnight. This makes the online retailer 11 times larger than CBA (market capitalisation). Amazon and Apple combined are worth more than the whole Australian sharemarket.
The Australian economy expanded by 0.9 per cent in the June quarter and 3.4 per cent over the year. The data was above the market’s expectations and has pushed the Australian dollar higher to US$0.7212 (from US$0.7189). The economy’s record expansion is now in its 28th year. As expected the biggest contribution to growth came from household consumption with retail spending improving from a slow start to 2018.
CommSec chief economist, Craig James said that “It is important to highlight that Aussie consumers and spending and that the growth of spending is actually ‘above-normal’.There is so much misinformation concerning consumer spending, generally of the form that consumers are keeping a tight grip on their wallets. Wages are still growing faster than the cost of living while the stronger job market is adding to the economy’s spending power.”
1.6bn shares have changed hands so far today worth $2.5bn. 428 stocks are up, 601 down and 365 are flat.
Published by CommSec