Markets

Australian Market Sharply Lower

(RTTNews) - The Australian stock market is sharply lower on Wednesday, snapping the previous three sessions of gains, with the benchmark S&P/ASX 200 falling below the 7,000 mark, following the negative cues overnight from Wall Street on sliding crude oil prices and concern over the outlook for interest rates. Stocks across all sectors are in the red, particularly energy, materials, and technology.

Traders also await the release of the minutes of the Federal Reserve's latest policy meeting for more cues on the U.S. central bank's monetary policy.

The benchmark S&P/ASX 200 Index is losing 115.50 points or 1.64 percent to 6,950.50, after hitting a low of 6,940.40 earlier. The broader All Ordinaries Index is down 110.30 points or 1.51 percent to 7,188.80. Australian stocks ended modestly higher on Tuesday.

Among major miners, BHP Group and Fortescue Metals are losing more than 2 percent each, while Rio Tinto and OZ Minerals are down more than 3 percent each. Mineral Resources are declining almost 3 percent.

In the tech space, WiseTech Global, Xero and Afterpay are flat, while artificial intelligence services provider Appen is surging more than 10 percent after reiterating its guidance.

Among the big four banks, ANZ Banking, Westpac, Commonwealth Bank and National Australia Bank are all losing more than 1 percent each.

Gold miners are also weak. Evolution Mining is losing 1 percent and Resolute Mining is declining almost 3 percent, while Northern Star Resources and Newcrest Mining are down more than 2 percent each. Gold Road Resources is flat. Oil stocks were lower after crude oil prices declined. Oil Search and Santos are losing more than 3 percent each, while Woodside Petroleum is down almost 2 percent. Origin Energy is declining almost 3 percent.

In other news, shares in EMl Payments are plummeting more than 36 percent on news that it's Irish subsidiary Prepaid Financial Services (PFS), which was bought in March 2020 for $252.3 million, is facing significant Irish regulatory problems due to Brexit. Before Brexit, PFS was regulated by British authorities.

Travel broker Webjet released full-year figures for a new year-ending date of March 31, with the company's net loss widening 9 percent to $156.6 million over the nine-month period. Revenue was down 86 per cent to $38.5 million. No dividend was declared, with payout suspended until at least July 2022. The stock is down more than 2 percent. In economic news, the wage price index in Australia was up a seasonally adjusted 0.6 percent on quarter in the first three months of 2021, the Australian Bureau of Statistics said on Wednesday. That exceeded expectations for 0.5 percent and was unchanged from the three months prior. On a yearly basis, the WPI advanced 1.5 percent - beating forecasts for 1.4 percent, which would have been unchanged.

Separately, the latest survey from Wetspac Bank and the Melbourne Institute revealed on Wednesday that consumer confidence in Australia fell 4.7 percent on month to 113.1 in May, from an eleven-year high of 118.8 in April.

In the currency market, the Aussie dollar is trading at $0.779 on Wednesday.

On Wall Street, stocks failed to hold early gains and ended weak on Tuesday as disappointing data on housing starts, and a sell-off in the technology section weighed on the market. Investors looked ahead to the release of the minutes of the Federal Reserve's April monetary policy meeting for clues about monetary tightening.

The Dow ended down by 267.13 points or 0.78 percent at 34,060.66, after having advanced to 34,408.99 in early trades. The Nasdaq, which rose to 14,485.34, settled at 13,303.64, recording a loss of 75.41 points or 0.56 percent, while the S&P 500 slid 35.46 points or 0.85 percent to settle at 4,127.83.

The major European markets also failed to hold early gains and closed mixed on the day. The U.K.'s FTSE 100 edged up 0.02 percent , Germany's DAX shed 0.07 percent and France's CAC 40 ended 0.21 percent down.

Crude oil futures settled lower Tuesday, weighed down by signs of progress in the Iran nuclear talks. Traders were also weighing global energy demand prospects amid the continued surge in coronavirus cases in Asian countries. West Texas Intermediate Crude oil futures for June ended lower by $0.78 or 1.2 percent at $65.49 a barrel.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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