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After adding 1.9% in August and improving for 11months in a row, the ASX 200 is starting September with a decline. The benchmark index is down 42 points or 0.56% to 7,492 approaching midday. Local losses also follow a weaker session on Wall Street overnight.

The weakness on the local market has been rather widespread with the majority of the sectors in the red. The consumer staples and discretionary sectors are leading falls with losses of 1.8% and 1.4% respectively while healthcare is also 1.4% weaker. Energy is rising despite oil prices dropping as much as 1% in the overnight session.

Individually, it has been the likes of major retailers, miners and a number of the big four banks that are weighing most on the broader market. Biotech giant CSL Ltd (CSL) is falling 1.3% and taking nearly 7 points off the ASX 200 index. Wesfarmers (WES) is down 3% and erasing 6 points from the index. Fortescue Metals Group (FMG) is down 3% and BHP Group (BHP) is 1.1% lower with both taking ~5 points off the ASX 200 each.

Some of the better performing stocks are travel and tourism names with Flight Centre (FLT) up 4.2%, Webjet (WEB) is adding 0.5% while Qantas (QAN) is lifting 2.5%. NSW Premier Gladys Berejiklian hinted that NSW residents could begin international travel from November if the double vaccination rate is at 80%.

In company news, Metcash (MTS) provided a trading update ahead of its AGM today. Supermarket sales fell
1.8% for the first 16 weeks compared to FY21, but remains 12.9% above FY20 sales. Total food sales are down 1.4% on FY21 (excludes end of 7-Eleven supply agreement in August 2020). Liquor & hardware sales are both higher on a year ago over the first 16 weeks. Liquor sales are 9.5% higher on FY21 with hardware sales increasing 16.3%. Metcash shares are down 1.2%.

The big economic news for the day was the release of the June Quarter economic growth or GDP data. The
Australian economy grew 0.7% in the quarter with growth of 9.6% on a year ago. Both the annual and quarterly figures were above market expectations. The upcoming September Quarter figures are expected to show a sharp decline due to the extended lockdowns and stay-at-home orders across a number of states and territories.

The AUD is fairly steady buying 73.15 US cents.

Published by CommSec