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Welcome to your five-minute recap of the trading day, and how the experts saw it.
The numbers: The ASX 200 lost its early lead and closed 0.7 per cent weaker at 7,105 points on Thursday, with a broad sell-off ensuring every sector, aside from tech stocks, ended the day lower.
Consumer staples took the biggest hit with Woolworths liquor spin-off Endeavour dropping 6 per cent after a market briefing. Energy, mining and gold stocks also posted hefty losses, with Fortescue down 3.7 paper cent and Ashanti Gold dropping 4.8 per cent.
The lifters: Appen 29%, ALS 6.1%, Tyro Payments 5%
The laggards: Endeavour -6%, Nanosonics -5.7%, Tabcorp -5.4%
The lowdown: Local news finally made a dent on the ASX 200, which was in the black until the release of weaker than expected construction and capital spending data.
UBS downgraded its GDP forecast to 1 per cent quarter-on-quarter from 1.3 per cent, “but still with material downside risk from net exports (which are due next Tuesday),” it said.
Adding to the gloom were downbeat remarks on China’s economy by Premier Li Keqiang and no signs of concrete measures to address it. Wall Street futures were also trading lower.
Macquarie Equities is also worried that the current market dynamics for iron ore are unsustainable.
“China is overproducing hot metal and underlying demand needs to get better, a lot better, for mills to sustain current production levels,” Macquarie said.
“Without an improvement in finished steel demand, iron ore is in for an ugly turn at some point.”
Whitehaven Coal also dropped sharply after Yancoal went into a trading halt ahead of what is reported to be a low ball offer to mop its shares by Chinese backers who own 62 per cent.
The tech sector was the only one to record a gain, with a big boost from Appen which rose as much as 35 per cent after the board engaged with an indicative bid for the group valuing it at just under $1.2 billion. The stock went into a trading halt in the afternoon pending further developments on the potential takeover.
Westpac also gained after it offloaded its asset management business and $38 billion super business to Mercer Super Trust for a net gain of $225 million.
Quote of the day: “In setting these new default market offer prices, we understand the significant impact they will have on some consumers who may already be struggling with cost-of-living pressures,” Australian Energy Regulator chair Clare Savage said after unveiling spikes in the cost of wholesale electricity are set to drive double-digit jumps in household and small business bills across the country within weeks.
Post of the day: The Motley Fool Australia CIO Scott Phillips on the AGL battle.
You may have missed: Gen Z and Millennials are changing the game for Woolies liquor/pubs/pokies spin-off Endeavour, with its retail giant Dan Murphy’s reporting that this demographic accounts for more than 35 per cent of its customers and 25 per cent of sales. It might not be a coincidence then that more than half of its sales now originate online.
The Market Recap newsletter is a wrap of the day’s trading. Get it each weekday afternoon.