SYDNEY, AAP – Shares were down on the ASX after the US Federal Reserve warned it could raise rates as soon as March to slow inflation in the pandemic recovery.

The market opened higher but later dipped 0.81 per cent on Thursday after Wall Street closed mostly lower following the US central bank’s largely expected rhetoric.

There were losses of a little more than two per cent for ASX shares in healthcare, technology and the consumer categories.

Energy shares were the stand out category. They were higher by about two and a half per cent as the price of Brent oil traded at almost $90.00 per tonne at 1200 AEDT.

Some traders are worried Russia will limit gas supply to Europe as the oil-exporting nation appears poised to invade Ukraine.

The major category of materials shares also helped limit losses. It was higher by half a per cent.

The benchmark S&P/ASX200 index was down 56.5 points, or 0.81 per cent, to 6905.1 points.

The All Ordinaries index was lower by 56.2 points, or 0.77 per cent, to 7191.9 points.

The US Federal Reserve did not raise rates at its January meeting but its warning of doing so soon helped the greenback.

The Aussie dollar dropped in response and fell below 71 US cents.

In Australia, economists at Westpac have slashed their economic growth forecast for the March quarter to zero due to the impact of the Omicron variant.

They have slashed the forecast from 2.3 per cent to zero, based on credit card data and consumer sentiment reports.

On the ASX, Beach Energy was benefiting from the higher oil price and rose 8.81 per cent to $1.42.

Santos and Woodside were each higher by three per cent.

A UK court has approved BHP’s plan to exchange its UK shares for Australian ones as it consolidates on the ASX.

The consolidation is expected to be finished by January 31.

BHP was up 2.35 per cent to $46.09.

Fortescue Metals improved 1.17 per cent to $19.73. Rio Tinto gained 3.18 per cent to $110.49.

There was news from some big retail stocks.

Premier Investments said its retail group was on track for first-half earnings to improve by four to five per cent.

The company claimed this would be a strong result as its stores such as Smiggle and Peter Alexander were closed for more than 42,000 days due to lockdowns.

Premier is closing four stores in the Sydney CBD as it tries to negotiate cheaper rents amid the pandemic.

Shares were up 4.48 per cent to $27.74.

Consumer goods trader Kogan revealed supply chain difficulties from the pandemic had impacted sales and earnings.

Company leaders tipped first-half gross profit would be down 4.4 per cent on the same period the year prior.

Earnings were tipped to fall 58 per cent or $30 million.

Kogan dropped 6.27 per cent to $6.57.

In banking, ANZ was best of the majors and added 1.28 per cent to $27.11. The Commonwealth was worst of the group and shed 0.70 per cent to $94.78.

The Australian dollar was buying 70.99 US cents at 1200 AEDT, lower from 71.39 US cents at Tuesday’s close before the market holiday.