The local share market has finished the day modestly lower, with the energy sector suffering its worst day in eight weeks, but the banks and tech stocks gained ground.
After being down as much as 61 points in the first 20 minutes of trading to hit a four-week low, the benchmark S&P/ASX200 index rebounded to close on Wednesday down just 11.5 points, or 0.16 per cent, at 6986.8.
The broader All Ordinaries finished 4.3 points lower at 7226.1, a loss of 0.06 per cent.
For the month the ASX200 finished 41.6 points higher, or 0.6 per cent, the index’s second month of gains after a 5.7 per cent rise in July.
“So interesting day today, end of month. We didn’t really get the fireworks, which is probably not surprising given that we’d already had a heck of a lot of fireworks throughout the month,” City Index market analyst Tony Sycamore told AAP.
Mr Sycamore said that this year the US market had experienced a 25 per cent rally followed by a 20 per cent selloff.
While the volatility hadn’t been quite as extreme here in Australia, he said he wouldn’t be surprised if both markets spent the next four to six weeks trading sideways.
“This year’s had everything except the sideways choppy market,” he said.
“A sharp selloff in January, rally back into the April highs, and then of course June was an absolute bloodbath for the stock market, both here and overseas.
“I’m quite encouraged by the way (the ASX) bounced today, bearing in mind that some of the support came from rebalancing flows,” Mr Sycamore added.
The local market had a negative lead from Wall Street, which finished lower for a third straight session after more hawkish talk from a Federal Reserve official. New York Fed president John Williams told the Wall Street Journal that interest rates needed to stay high through 2023 to curb inflation.
Energy companies were the biggest laggard, collectively dropping 2.9 per cent as Brent crude prices fell $US5 a barrel to around $US100.
Analysts attributed the drop to reassurances from Iraq’s state owned oil marketer that violent clashes in Baghdad hadn’t affected oil exports, as well as fears that aggressive rate hikes will curb economic growth and kill demand.
Woodside dropped 4.5 per cent to $34.24, Beach dropped 2.0 per cent to $1.71 and Ampol fell 1.6 per cent to $34.58.
The heavyweight mining sector was down 1.4 per cent, with BHP falling 2.8 per cent to $40.60, Fortescue Metals down 2.8 per cent to $18.42 and Rio Tinto down 1.1 per cent to $94.50.
Uranium stocks were higher for a second day, with Paladin Energy advancing 4.3 per cent and Boss Energy up by 8.8 per cent.
Tech stocks were the biggest gainers, collectively rising 1.7 per cent. Xero gained 3.7 per cent and Altium added 2.1 per cent.
All of the big four retail banks were higher, with NAB leading the way with a 2.0 per cent rise to $30.59. ANZ advanced 1.2 per cent to $22.83, Westpac added 1.6 per cent to $21.61 and CBA rose 1.0 per cent to $97.47.
Webjet had added 8.0 per cent to a one-month high of $5.52 after the travel company announced that bookings were “roaring back”.
“Bookings have been ahead of pre-pandemic levels since May,” managing director John Gusic told Webjet’s annual general meeting, adding that he expects Webjet’s earnings to exceed pre-pandemic levels by 2023/24.
Nitro Software had soared 39.8 per cent to a one-month high of $1.58 after the PDF software company announced it had rejected a tentative takeover approach from a Sydney private equity firm. Potentia Capital Management had floated a figure of $1.58 a share.
Clinuvel Pharmaceuticals gained 16.2 per cent to $20.18 after the biotech company raised its dividend from 2.5c to 4c per share after making $20.8 million in profit in the 12 months to June 30.
The Melbourne company, which makes a drug that treats rare genetic sensitivities to sunlight, noted it is one of the few bio-pharmaceutical companies on the ASX to generate profit.
On the flip side, DGL Group plunged 35.7 per cent to a one-year low of $1.84 after the Melbourne hazardous waste processor announced four different acquisitions along with its full-year earnings.
4DMedical gained 36 per cent to a one-week high of 68c after results from a Vanderbilt University clinical trial suggested its medical imaging scans could diagnose a certain type of lung damage without the need for surgical biopsies.
4DMedical noted that this month US President Joe Biden signed a bill making $US280 billion in funding available over 10 years to help treat US veterans who were exposed to airborne toxins from military burn pits in the Middle East.
The Australian dollar meanwhile was buying 68.92 US cents, from 68.98 US cents at Tuesday’s close.
ON THE ASX:
* The benchmark S&P/ASX200 index on Wednesday finished 11.5 points lower at 6986.8, a 0.16 per cent drop.
* The broader All Ordinaries fell 4.3 points, or 0.06 per cent, to 7226.1.
CURRENCY SNAPSHOT:
One Australian dollar buys:
* 68.92 US cents, from 69.76 US cents at Tuesday’s close
* 95.37 Japanese yen, from 95.16 yen
* 68.82 Euro cents, from 68.96 cents
* 59.06 British pence, from 58.72 pence
* 112.09 NZ cents, from 112.24 cents.
Derek Rose
(Australian Associated Press)