Profit taking and commodities drop: Aus shares close 0.5% lower

Market Reports

by Jessica Amir

The Aussie share market closed lower for the second day this week with miners dragging the ASX down on Wednesday and the ASX200 finished 0.5 per cent lower. 

There are a lot of things at play such as the iron ore, copper and nickel prices falling, while the US dollar is also under continued pressure causing the Australian dollar to rise and investors are also taking profits too in commodity companies which have been buoyed for some time.

Rio Tinto (ASX:RIO) fell 3 per cent, BHP (ASX:BHP) and Fortescue (ASX:FMG) lost over 2 per cent.

But the energy sector also copped some selling after the oil price slipped, but has maintained its two-year highs. Beach Energy (ASX:BPT) slipped over 2 per cent so too did the likes of Whitehaven Coal (ASX:WHC).

For the sectors, property added the most gains, followed by healthcare.

At the closing bell the S&P/ASX 200 index closed 0.5 per cent lower or 33 points lower at 6,016.

The value of trades was $5.1 billion on volume of 677 million shares at the close of trade. The top three stocks by value were BHP Billiton Limited (ASX:BHP), Rio Tinto Limited (ASX:RIO) and Commonwealth Bank of Australia (ASX:CBA).

On the futures market the SPI is 25 points down.

Local economic news

Total property loans rose 2.3 per cent in November 2017, according to the ABS. Owner occupied lending rose the most, up 2.7 per cent in the month while investment property lending shot up 1.5 per cent.

While construction activity jumped 30 per cent in the September quarter, almost double the June quarters growth of 15.6 per cent.

Company news 

Commercial property giant, Abacus Property Group (ASX:ABP) has announced its Managing Director, Dr Frank Wolf, will retire on 1 July 2018, after being with the group for 21 years. The firm’s Chief Investment Officer and Head of Strategy, Steven Sewell will join take the MD seat when Frank leaves. Shares in Abacus Property Group (ASX:ABP) closed 4 per cent lower at $3.59.

AusCann’s (ASX:AC8) strategic partner Canopy Growth Corporation has entered into a research collaboration with the Victorian State Government to further develop medical cannabis research and technical abilities in Australia. Shares in AusCann closed 3.7 per cent higher at $1.83.

Despite the weakness in the mining sector, Oz Minerals (ASX:OZL) rose over 1 cent after it exceeded its gold production forecasts.

South32 (ASX:S32) upgraded its South Africa manganese production guidance by 8 per cent due to strong market demand while it maintained FY2018 production guidance.

Sirtex Medical (ASX:SRX) was a star ASX200 performer, rising 16 per cent at one point after it announced a 16 per cent jump in its earnings (earnings before interest, tax, depreciation and amortisation (EBITDA)) for the six months to the end of 31 December 2017) to $34 million.

And global bank UBS Group became a substantial holder in Galaxy Resources (ASX:GXY), a lithium company with resources in Argentina, Quebec in Canada and WA.

Best and worst performers of the day

The best performing sector was Property adding 0.33 per cent to close at 1,357.
The worst performing sector was Materials, shedding 2 per cent to close at 11,821 points.

The best performing stock in the S&P/ASX 200 was Sirtex Medical Limited (ASX:SRX), rising 14 per cent to close at $17.83. Shares in Wisetech Global Limited (ASX:WTC) and The A2 Milk Company Limited (ASX:A2M) also closed higher.

The worst performing stock in the S&P/ASX 200 was Pilbara Minerals Limited (ASX:PLS), dropping 5.3 per cent to close at $1.06. (It was the best performing stock of 2017). Shares in Saracen Mineral Holdings Limited (ASX:SAR) and Galaxy Resources Limited (ASX: GXY) also closed lower.

Asian markets 

Japan’s Nikkei has lost 0.7 per cent, Hong Kong’s Hang Seng has lost 0.6 per cent and the Shanghai Composite is trading flat.

To commodities and the dollar

Gold is trading at $US1,336 an ounce.
Light crude is $0.41 lower at $US63.84 barrel.
One Australian dollar is buying 79.57 US cents.

Cryptocurrencies

Bitcoin has shed 16 per cent in the last 24 hours to $11,094
Ethereum dropped about 21 per cent to $987
And Tether has gained about 3.5 per cent to $1.04