Source : THE AGE NEWS
Welcome to your five-minute recap of the trading day.
The numbers
The Australian sharemarket slipped into the red on Wednesday, with Wall Street fluctuating overnight as investors await the release of US inflation data.
The S&P/ASX 200 lost 17.7 points, or 0.2 per cent, to 8213.3 points at close, with eight of the 11 industry sectors in the red. It followed a 0.5 per cent rise on Tuesday. The Australian dollar retreated slightly and was valued at US61.89¢ at 4.55pm AEDT.
Wall Street was mixed on Wednesday, with a number of influential stocks slipping. Credit: AP Photo
The lifters
Mexican-themed fast food chain Guzman y Gomez was one of the top-performing stocks on Wednesday, with shares rising 4.4 per cent after UBS upgraded the food retailer to a “neutral” rating.
Guzman’s rally helped made consumer discretionary stocks the best performing sector on the ASX (up 0.2 per cent). Baby Bunting shares surged (up 13.9 per cent) after the company released impressive results for the second half of 2024.
Fortescue rose (up 1.8 per cent), as did fellow miners Pilbara Minerals (up 4.1 per cent) and Northern Star Resources (up 1.1 per cent).
All the big four banks bar Commonwealth Bank (down 0.5 per cent) rose. NAB and ANZ (both up 0.6 per cent) gained the most, while Westpac rose 0.2 per cent.
Shopping centre owners lifted the real estate sector with Scentre and Stockland up 0.8 per cent and 1.2 per cent respectively.
The laggards
Energy giant Woodside (down 0.5 per cent) fell, while mining behemoth BHP lost 1 per cent.
The retail sector continued to suffer on Wednesday, with shares in Myer down 1.8 per cent.
Star Entertainment was up nearly 4 per cent during the morning but finished down 7.1 per cent. The embattled casino operator this week disclosed Xingchun Wang, who has a registered address in Macau, China, had become a substantial shareholder in the ailing business, with a 6.52 per cent stake.
Healthcare shares finished lower, with biotech giant CSL down 1.2 per cent and software medical imaging company Pro Medicus down 0.1 per cent.
Tech was the worst performing sector on the ASX, dragged down by the nation’s biggest tech company WiseTech Global (down 3.7 per cent).
The lowdown
The rise in consumer discretionary stocks came as Commonwealth Bank released data showing household spending dropped in December after a strong Black Friday period in the previous month.
CBA chief economist Stephen Halmarick said the data highlighted that Australians were remaining “cautious” amid ongoing financial pressures spurred by inflation.
“As we’ve seen in past years, sales spending on items like household goods was brought forward to October and November to take advantage of Black Friday sales promotions, which resulted in a drop in December,” Halmarick said.
“The weakness in spending in December, combined with the improving inflation environment, supports our view that the RBA can begin to lower interest rates at the first meeting of the year in 2025.”
As markets focus on inflation risks, US consumer price data for December is set to be released early on Thursday morning (AEDT).
Economists will also look to December’s unemployment figures, released on Thursday morning, as they continue to refine forecasts for the timing of expected cuts to official interest rates from the Reserve Bank.
Meanwhile, the US Securities and Exchange Commission has sued billionaire Elon Musk, saying he failed to disclose his ownership of Twitter stock in a timely manner in early 2022, before buying the social media site.
As a result, the SEC alleges, Musk was able to underpay “by at least $US150 million ($242 billion)” for shares he bought after he should have disclosed his ownership of more than 5 per cent of Twitter’s shares. Musk bought Twitter in October 2022 and later renamed it X.
The SEC has sued Elon Musk. Credit: AP
Musk started amassing Twitter shares in early 2022, and by March of that year, he owned more than 5 per cent. At this point, the complaint says, he was required by law to disclose his ownership, but he failed to do so until April 4, 11 days after the report was due.
Musk’s lawyer, Alex Spiro, said in a statement that the lawsuit “is an admission by the SEC that they cannot bring an actual case” since Musk has “done nothing wrong.” He called the lawsuit a “sham.”
On Wall Street, stocks got a boost from a report showing inflation at the US wholesale level wasn’t as high last month as economists expected. It’s an encouraging signal ahead of a report coming on Wednesday, which will show how much inflation US consumers faced at gasoline pumps, grocery registers and auto lots in December.
Stubbornly high readings on inflation and a run of better-than-expected updates on the US economy have sent Wall Street into a weeks-long rut, pulling it further from the dozens of all-time highs set last year. The fear is that all the strong data will convince the Federal Reserve to deliver less relief this year through lower interest rates.
Benchmark US crude eased 1.7 per cent to $US77.50 per barrel. Brent crude, the international standard, fell 1.3 per cent to $US79.92 per barrel.
Tweet of the day
Quote of the day
“I am today announcing that I will create the EXTERNAL REVENUE SERVICE to collect our Tariffs, Duties, and all Revenue that come from Foreign sources. We will begin charging those that make money off of us with Trade, and they will start paying, FINALLY, their fair share.”
President-elect Donald Trump, announcing a new body to collect foreign revenue. It comes less than a week before his inauguration, and amid the looming threat of new tariffs on China, Canada and Mexico.
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With AP
The Market Recap newsletter is a wrap of the day’s trading. Get it each weekday afternoon.
