It has been a softer start to the week for the Aussie share market following a run of six straight gains. The ASX 200 is giving back 17 points or 0.3% to 5831 after a 3.25% rallylast week.
It was a weak lead from Wall Street after stronger than expected US employment figures gave rise to expectations of further interest rate rises (next hike anticipated for Dec this year) and mixed signals for a possible trade deal between the US and China at the G20 summit this month.
Back home, losses are generally across the board with the majority of sectors in the red towards lunch. Gains for supermarkets Woolworths (WOW) and Coles’ owner Wesfarmers (WES) are pushing staples higher.
Losses in energy and healthcare are weighing most. Crude oil eased following temporary exemptions on trade sanctions of Iranian oil exports. Crude oil prices fell more than 6% over the last week with Woodside (WPL) falling the most by 1.5%. Hearing aid maker, Cochlear (COH) is down 2.3% with an unfavourable decision in a US patent infringement case. COH will appeal the decision.
The major banks are also weaker with Commonwealth Bank (CBA) leading the losses, down 1.3%. Westpac Bank (WBC) is slipping 0.1% after releasing a flat cash earnings of $8.07 billion, and slightly under analyst estimates according to Bloomberg. WBC had previously flagged a $281 million hit to its bottom line from higher provisions and other customer related charges.
Elsewhere, Webjet (WEB) is in a trading halt on a pending acquisition of whole travel business Destinations of the World (DOTW) and capital raising. WEB will pay $240 million and will look to raise $153 million to help the takeover. Bluescope Steel (BSL) is higher by 1% on an acquisition of a Malaysian steel facility for $42 million.
The Aussie dollar fell from its highs late last Friday but is still trading near 72 US cents. It is a busy week on the economic calendar here and abroad with central bank meetings here (Tues) and in the US (Thurs/Fri). The RBA will also release its quarterly Statement on Monetary Policy this Friday with forecasts of inflation and GDP growth.
So far, 1B units have traded worth $1.5B with 492 stocks higher, 445 lower and 309 unchanged.
Published by James Tao, CommSec