The Aussie sharemarket had a choppy start to the month and dipped into negative territory despite a positive start to trade. At the close however, the S&P/ASX 200 finished with a modest increase of 0.3 per cent or 22.8pts, to 7234. Of the 11 major sectors, seven finished in positive territory. The Utilities sector dragged the market lower after it recorded its largest daily decline since the onset of Covid-19 in March 2020. The big four banks all finished higher, lifting the broader Financials sector by 1.2 per cent.
In economic news today, the Australian economy, as measured by gross domestic product (GDP), grew by 3.3 per cent over the year (decade average +2.3 per cent). In nominal terms, the economy grew annually by 10.2 per cent (decade average +4.0 per cent). The biggest contributors to the expansion were inventories, household spending, government consumption and private and public investment.
In more economic news, the CoreLogic Home Value Index of national home prices fell by 0.1 per cent in May – the first fall in 20 months. Capital city home prices fell by 0.3 per cent but regional prices rose by 0.5 per cent.
Shares of lithium miners Allkem (AKE), Liontown Resources (LTR) and Pilbara Minerals (PLS) are amongst the worst performers today after their shares shed 15.4 per cent, 19.1 per cent and 22.0 per cent, respectively. This follows broker reports and media speculation suggesting that the price of battery metals may have peaked.
In company news, shares of Origin Energy (ORG) slipped 13.7 per cent following a trading update. In the update, ORG withdrew all of its FY23 guidance because of a “high degree of uncertainty around the range of earnings”. ORG expects that challenges with coal delivery are expected to cause a “material increase in coal purchasing costs”, driving margins lower. But the energy provider has also said that higher domestic gas prices are likely to be a tailwind to its earnings in FY23.
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Biotechnology company Mesoblast (MSB) released a quarterly update today, outlining a 5 per cent annual increase in its revenues, and a US$5.2 million improvement in its losses after tax, to US$21.3 million. The earnings improvement comes after MSB reduced its research and development, and manufacturing expenses by 35 per cent and 23.3 per cent, respectively.
4.8bn shares were traded, worth $8.2bn. 452 stocks finished higher, 988 ended lower, while 375 closed unchanged.
In the US, the JOLTS job openings report is due with ISM and S&P Global PMIs and construction spending. On Friday, US unemployment numbers will be released.
Originally published by Divik Nigam – (Author), CommSec
