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The Australian sharemarket is coming under pressure for the second day, with the ASX 200 down by ~0.5 per cent after a couple of hours of trade. Despite the modest losses being driven by weaker bank stocks, local shares rose strongly on Monday and Tuesday, which keeps the market on track to lift by ~2 per cent this week.

It was a choppy session for US markets last night, with the Dow Jones and S&P 500 lacking enthusiasm in late trade to finish almost 1 per cent lower. Technology stocks like Apple and Microsoft continue to standout. All eyes will remain on the US labour market in coming days. Last night a report showed that US companies cut 20.2 million jobs in April. This was inline with market expectations. Tonight the closely watched weekly update on unemployment benefits will be released. Over the prior six weeks, over 30 million Americans have filed to receive jobless benefits from the government. On Friday night, the April read on employment will be released. Market’s expect the US unemployment rate to lift from 4.4 per cent in March to between 16 and 20 per cent.

The big banks are declining by as much as 1.6 per cent at lunch, which is enough to account for around half the ASX 200’s slide so far today. Macquarie Group (MQG) is up 0.4 per cent ahead of its FY20 results set to be released on Friday.

Energy stocks are falling most, following a near 2.5 per cent fall in the oil price overnight. This marked the first fall in six days for oil prices. Santos (STO) is down 2.5 per cent, Origin (ORG) is off 2 per cent and Woodside (WPL) is declining by 1.5 per cent. The price of oil has close to doubled over the past week.

Goodman Group (GMG) is up 3 per cent after reaffirming its FY20 earnings and distribution guidance. All other major property stocks are coming under pressure.

CSL Limited (CSL) has carried out a US$750m debt raising to be used ‘for general corporate purposes’ and said it strengthens the company’s current debt maturity.

Caltex (CTX) said the crude oil market has significantly weakened, with an increase in storage on water lifting crude and product freight rates. Demand for jet fuel and retail fuel volumes have fallen heavily. CTX shares are down just 0.4 per cent.

2.2bn shares have changed hands so far today worth $2.5bn. 518 stocks are up, 510 down and 321 are unchanged.

Published by CommSec