Market wrap: Stronger Wall Street not enough to save Australian shares from a weekly fall

Market wrap: Stronger Wall Street not enough to save Australian shares from a weekly fall

Not even a strong performance on Wall Street was enough to save Australian shares from a fall on Friday which left the market 1% lower for the week as tech gains couldn’t overcome rising borrowing costs and higher oil prices.

By the close the ASX 200 was down 14 points, or 0.2% to 9005.9 points with five of the 11 sectors falling.

That was a marked contrast with Wall Street with rising technology stocks driving a 1.1% rise in the S&P 500, while Dow was up 1.2% and the tech heavy Nasdaq was up 1.4%.

Instrumental in these index rises were gains from Microsoft (2.7%), Apple (1%), and Meta (3%)

Stronger than expected economic growth in Australia seemed to be the big headwind as local investors started to factor in another interest rate rise and possibly two as the Reserve Bank starts to walk a tightrope between higher unemployment and falling house prices on the one side and dealing with higher inflation on the other.

Already the Reserve Bank has shown that it is not scared to lead the global pack having already raised official interest rates three times this year.

Traders now think there is a 70% chance that they could go for a fourth rise at the September 29 policy meeting.

Firm oil price doesn’t help producers

Despite a firmer oil price which has now climbed above US$95 a barrel, energy stocks were down, with shares in fuel refiner Ampol (ASX: ALD) dropping 6% to $41.65 and Viva Energy (ASX: VEA) down 3.7% at $2.90 as both traded ex-dividend.

Even the producers were struggling with shares in Woodside (ASX: WDS) down 1.2% to $31.83 and Santos shares (ASX: STO) down 0.85% to $ 8.21.

The large miners were in a similar pickle with market sentiment overtaking rising iron ore and copper prices.

Shares in Rio Tinto (ASX: RIO) fell 0.7% to $175.90 while BHP shares (ASX: BHP) lost 2.4% to $62.25.

Gold stocks keep shining

Gold miners had a better time of it as the gold price remained above $US4400 an ounce.

Newmont shares (ASX: NEM) jumped almost 2% to $178.31 with Perseus Mining (ASX: PRU) also up 2% to $6.77 and Northern Star Resources (ASX: NST) flat on $23.17.

The big banks didn’t play a big part in the overall market action with Commonwealth (ASX: CBA), National Australia (ASX: NAB) and ANZ (ASX: ANZ) sliding by up to 0.2% while Westpac shares (ASX: WBC) headed in the other direction, up 0.1% to $34.96.

Corporate Travel share suspension doesn’t end well

Shareholders in the embattled listed travel company Corporate Travel (ASX: CTD) enjoyed a brief respite in morning trade with a rise from the brutal relisting fall of 86% the previous day.

However, the pessimists quickly returned and by the close the company was trading down 3% to $2.25.

Also recovering after a bruising day, shares in Regis Healthcare (ASX: RHG) were up more than 5% to $4.54 after suffering a chunky 27% plunge on Thursday after a warning that government funding hikes will be much slower then surging operational costs.

One of the more interesting trades of the day was shares in Nine Entertainment (ASX: NEC) which fell 7.3% to 91.5¢.

That fall followed news that billionaire media mogul Bruce Gordon has tightened his grip on the company by pushing his ownership past 31%.

The week ahead

Given the market’s concerns about official interest rate rises, this week investors will be busy reading the tea leaves to glean any tips about which way they might go.

There is no shortage of potential clues to be dropped with Assistant Governor Sarah Hunter speaking at the AFR Property Summit in Sydney on Tuesday and Deputy Governor Andrew Hauser also due to appear on the ABC’s 7.30 television show later that day.

Ex-dividend trades to pressure share prices

Similar to the past week, a swag of companies large and small will be trading without their dividends this week so many of them might struggle to keep their share prices higher.

In the US, the main economic releases are inflation data, with the Producer Price Index and the CPI figures due on Thursday and Friday.

The big question is whether inflationary pressures are persisting, with interest rate expectations hanging on how the data falls.

In Europe, the European Central Bank is expected to raise interest rates by 25 basis points to 2.50% on Thursday.