Australian shares are grinding lower as markets digest the interest rate decision and uncertainty hangs over the outcome of the US midterm elections.
The main S&P/ASX200 fell 42.7 points by midday on Wednesday, down 0.48 per cent, to 8844.1, as the broader All Ordinaries lost 40.4 points, or 0.45 per cent, to 8968.5.
The local market was facing a dual squeeze, Moomoo chief market strategist Tapas Strickland said.
“Investors are absorbing the Reserve Bank’s decision to lift the cash rate by 25 basis points to 4.85 per cent – its highest mark since late 2008 – while warily awaiting early tallies from the US midterm elections,” Mr Strickland said.
“Local miners also face headwinds after copper fell 2.5 per cent and gold slipped 0.9 per cent.”
The raw materials sector eased 0.5 per cent, tracking with similar slumps in BHP and Rio Tinto, while gold stocks were mixed as the precious metal lingered near $US3931 ($5640) an ounce.
The heavyweight financials sector was down 0.9 per cent with all big four banks in the red, wiping Tuesday’s advance with interest despite initially advancing when the Reserve Bank’s rate hike came with dovish official commentary.
Insurers took a tailwind from the higher rate environment, with IAG and Suncorp each up trading higher.
Energy stocks gained 0.6 per cent as Brent crude rebounded to $US104.50 a barrel, supporting Woodside and Santos, along with refinery operators Viva and Ampol.
Coal producers also advanced, while uranium stocks fell for a second session as investor jitters around the artificial intelligence trade persisted.
Consumer-facing stocks were mixed, as traditionally defensive staples advanced 0.6 per cent (fellow defensive utilities stocks also outperformed), while discretionaries retreated after rallying on Tuesday on the hopes the Reserve Bank is done hiking borrowing costs.
In company news, online graphic design platform Canva will cut or relocate almost 1300 jobs, amounting to more than a fifth of its total workforce.
Goodman Group has assured the market its infrastructure development pipeline remains on track, despite rising barriers to entry, and says data centre demand continues to outstrip supply.
Ramelius Resources has hired investment bank Barrenjoey to chase an acquisition of Northern Star’s Carosue Dam gold mine, worth an estimated $800 million.
Meanwhile, struggling department store chain David Jones has paid its rent up to the end of September, according to the listed owner of the 17 Westfield shopping centres where it has major stores.
The Australian dollar was buying 69.69 US cents, down from 69.79 US cents on Tuesday at 5pm.
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