Local shares are looking to snap its recent run of four straight days of gains with the ASX 200 down 68 points or 1% to 6757 around lunch. The Aussie market started its decline following news that Iran fired several missiles at Iraqi army bases housing US troops. The strikes are retaliation for a US drone strike that killed a leading Iranian military general last Friday. Tensions between the US and Iran has caused volatility for global markets this week.
The declines so far have been rather broad based with only the energy sector currently in positive territory. Middle East tensions have investors considering the potential disruption to oil supply from the region. This uncertainty has created volatility in oil markets. Major local oil & gas producers are rising as much as 4.9% with Beach Energy (BPT) leading gains. Oil Search (OSH) is 3% higher while Santos (STO) and Woodside (WPL) are both more than 1.5% higher. Caltex (CTX) is gaining 1% after confirming it has received several approaches for a takeover.
Investors are also turning to safe havens with gold prices rallying and recently hitting the highest levels since 2013. Gold miners are the other sub-index to outperform due to this. Names such as Saracen Minerals (SAR) and St Barbara (SBM) are climbing 5% or more. Resolute Mining (RSG) is also improving 4.7% after releasing a December quarter production update this morning.
Losses are currently most severe among tech, health and financial stocks with the major lenders, biotech firm CSL Ltd (CSL) and BHP Group (BHP) the major contributors to the broader tumbles.
In company news, Wistech Global (WTC) is 4.3% lower as it announced another acquisition. The logistics software firm is paying an upfront fee of ~$15.5m for SISA Studio, a Swiss based customs and freight solutions provider. Elsewhere, Independence Group (IGO) is jumping 7.2% after the diversified miner beat expectations with its 1H20 production update as its nickel, copper and gold output beat guidance.
On the economic front, building approvals in November surged 11.8% compared to estimates of a 2% increase. The Aussie dollar is buying 68.5 US cents. So far, 1.2b units have traded worth $1.9b with 319 stocks higher, 654 weaker and 311 unchanged.
Published by CommSec