The Australian share market has fallen as surging oil prices continue to weigh on both investor and consumer confidence, after a public holiday in the US.
The benchmark S&P/ASX200 index fell 33.2 points by midday on Tuesday to be down 0.37 per cent to 8,977.7, as the broader All Ordinaries lost 30.4 points, or 0.33 per cent, to 9,170.2.
“While US Labor Day (on Monday) made for a somewhat quieter start to the week for trading volumes, the weekend’s tit-for-tat strikes between the US and Iran continued to put upward pressure on oil prices, acting as a drag on risk sentiment more broadly,” Westpac economist Ryan Wells said.
“Yields also continued to rise globally, following moves from the US as concerns over inflation and debt levels persist.”
Brent crude topped $US98 a barrel for the first time since July 24, supporting the local energy sector.
Refinery operators Ampol and Viva advanced, along with select coal miners and Santos, which gained 0.6 per cent after upping its stake in the Papua LNG project to more than one-fifth.
Financials weighed heavily, dropping 0.9 per cent in a broad-based sell-off.
All big four banks were in the red as housing market concerns continued to mount, with HSBC researchers expecting a 13 per cent decline, which would make it Australia’s biggest housing price correction in modern history.
Raw materials inched 0.2 per cent higher, but record-high copper prices weren’t enough to bolster BHP and Rio Tinto.
Copper futures hit $US14,533 ($A20,141) per tonne on the London Metal Exchange overnight, resetting the commodity’s January record as demand for the base metal continues to surge.
Gold stocks were mostly higher, as the precious metal firmed to $US4,432 ($A6,142) an ounce.
Consumer-facing stocks were under pressure, with staples shedding 0.8 per cent and discretionaries down 0.5 per cent, as the Westpac/Melbourne Institute consumer sentiment index retreated.
Higher fuel costs, interest rates, the housing downturn and uncertainty about jobs – particularly in construction and hospitality – were weighing on confidence, Westpac economists said.
In company news, Bluescope Steel, News Corporation, Regis Healthcare, AUB Group and Mineral Resources all dipped after trading ex-dividend, with CSL, Evolution, Northern Star and Brambles to lock in their shareholder payouts on Wednesday.
Westpac has appointed Sarah Donnelly as its company secretary, to take over from Timothy Hartin on September 21.
Investors will be closely watching Reserve Bank assistant governor Sarah Hunter, who’s due to take part in a fireside chat at 1.30pm (AEST) during a summit in Sydney, for signals on the central bank’s path ahead.
Deputy governor Andrew Hauser is due to be interviewed on ABC’s 7.30 program tonight.
The Australian dollar was buying 72.16 US cents, up slightly from 72.15 US cents on Monday at 5pm.
Australian Associated Press is the beating heart of Australian news. AAP is Australia’s only independent national newswire and has been delivering accurate, reliable and fast news content to the media industry, government and corporate sector for 85 years. We keep Australia informed.
