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Local shares are easing at lunch on Wednesday with the ASX 200 down 36 points or 0.54% to 6709. The Aussie market is taking the lead of its global peers which were generally lower ahead of the US Fed’s interest rate decision, with markets pricing in a ~90% chance of a 0.25% cut. The decision will be released 5am AEDT Thursday

Locally, the focus is on today’s inflation reading for the September quarter. The inflation reading was in line with expectations with prices lifting 0.5% over the quarter and 1.7% year on year. The reading means it is unlikely that the RBA will cut rates on Melbourne Cup day next Tuesday. The Aussie dollar has since firmed to 68.7 US cents.

Losses have been broad based on today’s market so far. Every sector is in negative territory with the steepest declines for the likes of IT, communications, consumer discretionary and materials. The energy sector is outperforming with the smallest decline.

Miners are among the major weights for the market with a generally weaker prices for commodities as iron ore fell 2.5% overnight. BHP Group (BHP) is down 1.4 and Fortescue Metals (FMG) is 1.5% lower. The major lenders are also dragging the broader market lower with losses up to 0.6%. Other major companies Telstra (TLS) and
Wesfarmers (WES) are also contributing heavily to overall softness.

Woolworths (WOW) shares are also falling 0.9% despite a solid quarterly sales update. Woolies has been outperforming Coles (COL) in sales growth with Australian food (supermarket) comparable sales lifting 6.6% to $10.7 billion where COL reported sales of $7.7 billion and only 0.1% growth. The negative for WOW is the fact that it has underpaid 5,700 store members over a period of time.

One of the worst performers among the top 200 stocks is Costa Group (CGC), tumbling 19%. The fruit and veg grower has resumed trade from a week long suspension with profit guidance lowered due to the prolonged drought conditions and the impact to the quality of its produce. CGC has also raised $87 million to help strengthen its balance sheet.

So far, 1.3b units have been traded worth $1.8b. 443 stocks are higher, 513 are lower and 339 unchanged.

Published by CommSec