Australian Market Modestly Lower

The Australian stock market is modestly lower in choppy trading on Thursday, extending the gains in the previous two sessions, with the benchmark S&P/ASX 200 staying below the 7,100 level, following the broadly positive cues overnight from Wall Street, as technology stocks tumbled to follow their peers on Nasdaq.

Trades also remain concerned about the domestic new coronavirus infections, though off record highs. New South Wales records 12,632 new cases and 38 deaths on Wednesday. Victoria reported 12,157 new cases and 34 deaths, Queensland recorded 8,643 new cases and nine deaths, Tasmania reported 656 new cases and one death, South Australia reported 1,583 new cases and one death, and ACT reported 529 new cases.

The benchmark S&P/ASX 200 Index is losing 21.80 points or 0.31 percent to 7,065.90, after hitting a low of 7,045.80 earlier. The broader All Ordinaries Index is down 34.80 points or 0.47 percent to 7,364.80. Australian markets ended sharply higher on Tuesday.

Among major miners, BHP Group, Fortescue Metals and Rio Tinto are gaining more than 2 percent each, while OZ Minerals is losing almost 2 percent. Mineral Resources is edging up 0.5 Percent.

Oil stocks are mixed. Woodside Petroleum and Origin Energy are edging up 0.3 percent each, while Beach Energy and Santos are losing almost 1 percent each.

Among the big four banks, Commonwealth Bank is losing almost 1 percent, while National Australia Bank and ANZ Banking are edging up 0.2 percent each. Westpac is advancing more than 2 percent despite reporting a 20 percent drop in first-quarter cash earnings and warning that steep competition in mortgages would drag margins more this year.

In the tech space, WiseTech Global and Block are plunging almost 9 percent, while Zip and Appen are slipping almost 7 percent. Xero is losing more than 5 percent.

Gold miners are mixed. Newcrest Mining and Evolution Mining are edging down 0.2 percent each, while Northern Star Resources is slipping almost 1 percent and Gold Road Resources is up 1.5 percent. Resolute Mining is flat,

In other news, shares in Nufarm are soaring more than 15 percent after the agricultural chemical company revealed a 36 percent year-over-year rise in revenue for the first quarter. It is also increasingly confident of revenue and earnings growth for the full FY22 financial year.

In economic news, the services sector in Australia fell into contraction January, the latest survey from Markit Economics revealed on Thursday with a services PMI score of 46.6. That’s down from 55.1 in December and it moves beneath the boom-or-bust line of 50 that separates expansion from contraction. The survey also showed that the composite PMI sank to 46.7 in January from 54.9 in December.

The total number of building permits issue in Australia was up a seasonally adjusted 8.2 percent on month in December, the Australian Bureau of Statistics or ABS said on Thursday, coming in at 17,698. That beat expectations for a decline of 1.0 percent following the increase of 3.6 percent in November. On a yearly basis, approvals for total dwellings were down 7.5 percent, for private sector houses tumbled 21.3 percent and for private sector dwellings excluding houses jumped 24.5 percent.

The ABS also said Australia posted a merchandise trade surplus of A$8.356 billion in December. That’s down from the upwardly revised A$9.756 billion surplus in November (originally A$9.423 billion). Exports rose A$360 million or 1.0 percent on month to A$45.320 billion, slowing from 2.0 percent in the previous month. Imports climbed A$1.761 billion or 5.0 percent on month to A$36.964 billion, down from the upwardly revised 8.3 percent increase a month earlier (originally 6 percent).

In the currency market, the Aussie dollar is trading at $0.712 on Thursday.

On Wall Street, stocks moved mostly higher over the course of the trading day on Wednesday, extending the strong upward move seen over the three previous sessions. With the continued advance, the Nasdaq and the S&P 500 climbed further off last week’s multi-month lows.

The major averages all finished the day firmly in positive territory. The Dow climbed 224.09 points or 0.6 percent at 35,629.33, the Nasdaq rose 71.54 points or 0.5 percent to 14,417.55 and the S&P 500 advanced 42.84 points or 0.9 percent to 4,589.38.

The major European markets also moved mostly higher on the day, although the German DAX Index closed just below the unchanged line. The French CAC 40 Index edged up by 0.2 percent and the U.K.’s FTSE 100 Index climbed by 0.6 percent.

Crude oil futures inched higher Wednesday, supported by data showing a drop in U.S. crude stockpiles last week. However, the rise was just marginal as OPEC and its allies approved another 400,000 barrels per day in production that will begin in March. West Texas Intermediate Crude oil futures for March ended up by $0.06 or 0.1 percent at $88.26 a barrel.

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