China manufacturing falls for 2nd time: Aus shares close 0.4% lower

Market Reports

by Jessica Amir

The Australia share market started on the front foot today but dived into negative territory before closing lower. It comes after selling mounted in half of the sectors with Telcos, Property, and Financials losing about 1.5 per cent after Chinese manufacturing activity contracted for the second straight month in January.

Meanwhile, gains were seen in over half of the sectors, with local tech stocks gaining the most with Xero (ASX:XRO) shares up over 8 per cent.

From the get-go, we had positive leads from Wall Street, after the tech-heavy Nasdaq rose 2.2 per cent, on Apple rising 6.8 per cent a day after releasing their earnings.

At the closing bell the S&P/ASX 200 index closed 0.4 per cent or 22 points lower at 5,864.

Yesterday, all major indices gained in the US after the Fed signalled to be patient with rate hike. 


Dow futures are suggesting a gain of 24 points.
S&P 500 futures are eyeing a rise of 3 points.
The Nasdaq futures are eyeing a gain of 27 points.
And the ASX200 futures are eyeing a 9-point fall tomorrow morning

Local economic news

Australia’s total loans outstanding loans rose 4.3 per cent, year-on-year to December 2018, according to the Reserve Bank of Australia (RBA), that’s less than the 4.5 per cent expected and less than the 4.8 per cent recorded in the same time last year.

Company news 

Syrah Resources (ASX:SYR) shares copped some heavy selling for the second straight day and today it announced it’s issuing new shares to the market. Yesterday it announced graphite sold and shipped rose in the fourth quarter of 2018, despite production being impacted by fire damage at its Balama project. Syrah Resources (ASX:SYR) closed 10.1 per cent lower at $1.56.

Beach Energy (ASX:BPT) shares gained 6 per cent today, after upgrading its production guidance on the back of a better than expected production in the first half of 2019. Its FY19 guidance increased from 28 to 29 MMboe, up from the prior guidance of 25 to 27MMboe. It also upped its second half 2019 forecasted output.

Origin Energy (ASX:ORG) shares hit a three-month high earlier in the session after it announced record quarterly revenue from Australia Pacific LNG of $741 million as at 31 December 2018. That’s a 45 per cent jump compared to the same quarter in 2017. The business says it benefited from higher commodity prices and favourable movements in the exchange rate, while it also kept production levels at a steady-state. But its shares closed lower.

Infant formula business, Bubs Australia (ASX:BUB) had its shares gained 23 per cent after it announced China sales have boosted its gross revenue to $21 million, in the first half of the 2019 financial year, exceeding the gross revenue for the full financial year 2018.

AGL Energy (ASX:AGL) shares fell 1 per cent after it announced the termination of its agreement to sell its North Queensland gas assets to Order (Moranbah) Holdings, which was originally announced in August 2017. It comes as certain conditions couldn’t be met to secure the sale.

Best and worst performers of the day

The best performing sector was Energy adding 1 per cent while the worst performing sector was Telco Services, shedding 1.6 per cent.

The best performing stock in the S&P/ASX 200 was Xero Limited (ASX:XRO), rising 8.8 per cent to close at $43.56. Shares in Western Areas Limited (ASX:WSA) and Lynas Corporation Limited (ASX:LYC) followed higher.

The worst performing stock in the S&P/ASX 200 was Syrah Resources Limited (ASX:SYR), dropping 10.1 per cent to close at $1.56. Shares in Emeco Holdings Limited (ASX:EHL) and Ardent Leisure Group Limited (ASX:ALG) followed lower.

Asian markets

Higher: Japan’s Nikkei has added 1.2 per cent, Hong Kong’s Hang Seng has gained 1.6 per cent and the Shanghai Composite has gained 0.6 per cent.

Commodities and the dollar

Gold is trading at US$1,320 an ounce.
Iron ore price rose 4.9 per cent to US$82.53
Iron ore futures are eyeing a rise of 1 per cent.
Light crude is $0.91 higher at $US54.22 a barrel.
One Australian dollar is buying 72.68 US cents.


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