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Investor nerves are still rattled after the worst weekly loss on the Australian sharemarket since January 2016 last week with the ASX 200 stumbling again on Monday. The index is down another 88 points or 1.5% to 5807 and accelerating towards lunch despite a strong rally for Wall Street on Friday where the Dow rebounded 1.2% and the NASDAQ lifted by 2.3%.
The downward pressure has remained for all sectors with financials and materials bearing the brunt of the losses. The big four banks are down in the range of 1.5-2% along with Macquarie Group (MQG) and insurers. Metals prices were generally higher but that has not related back to mining stocks with declines for a large proportion of miners.
Among the limited winners is health stock ResMed (RMD), up 0.5% while telco TPG Telecom (TPM) is advancing 0.3%. Santos (STO) is 1.3% higher after signing a gas processing agreement with Real Energy (RLE) at STO’s facility in Moomba, South Australia.
Retailers are mostly lower although Wesfarmers (WES) is 0.5% weaker after releasing quarterly sales for Coles ahead of its planned spinoff later this year. Headline sales increased 5.8% and total sales improved 5%, benefited by the success of the ‘Little Shop’ promotional campaign. Coles liquor and convenience also recorded sales growth over the quarter.
Evolution Mining (EVN) is 2.5% weaker on a weaker quarterly gold production update. Output was down on the prior quarter to 200,218oz while costs increased over the same period with an All-in Sustaining Cost of A$885/oz.
Elsewhere, jewellery retailer Michael Hill (MHJ) is slumping 25% after releasing a quarterly update after market on Friday. Group revenue was down 8.8% while same store sales declined 11% on the prior year. Sales in all regions (NZ, Aus & Canada) fell for the quarter.
It is a quiet day on the economic front locally with no major releases. The major talking point will be the September employment data released on Thursday this week. The Aussie dollar is holding around the 71 US cent mark.
So far, 0.9B units have traded worth $1.9B with 397 stocks higher, 554 weaker and 335 unchanged.
Published by James Tao, CommSec