Iran nuclear deal & resurfacing inflation fears spook investors: Aus shares close 1.9% lower

Market Reports

by Michael Luu

Text-only (non-video) report.

The Australian sharemarket maintained its downward tendency in the afternoon session, as inflation speculation and lackluster consumer sentiment data scared off stock bargain hunters.

At the closing bell, the S&P/ASX 200 was 1.90 per cent or 134.30 points lower at 6931.70.

Commodities-related stocks contributed the most weight on the market, due to falling oil prices and the International Energy Agency (IEA)’s recommendation for the sector’s development.

The anticipation of a nuclear deal with Iran has driven oil prices downwards. The pressure on oil prices also intensified due to reduced demand for oil in the world’s second biggest population of India, as pandemic conditions continue to ravage the embattled country. Origin Energy (ASX:ORG) and AGL Energy (ASX:AGL) shed 4.9 per cent and 3.8 per cent respectively by the close of trade.

On the materials front, the IEA has downplayed the need for new mines and opposed the construction of new coal projects from the end of this year in order to accomplish emissions reduction goals. Meanwhile, gold players lost their shine, contradicting the precious metal’s prices. Mining giants BHP (ASX:BHP), Rio Tinto (ASX:RIO) and Fortescue Metals (ASX:FMG) all conceded losses of over 3.5 per cent by 4pm.

Economic News

The Australian Bureau of Statistics has released data from the wage price index, indicating a 0.6 per cent rise in wages expenditure for the March quarter.

Experts have linked the rise in employment expenses to the limited supply of labour due to continued border closures, as many employers have reported a shortage of skilled workers. 

Futures

The Dow Jones futures are pointing to a fall of 107.00 points.
The S&P 500 futures are pointing to a fall of 13.75 points.
The Nasdaq futures are pointing to a fall of 62.25 points.
The SPI futures are pointing to a fall of 138 points when the market next opens.

Best and worst performers

All sectors closed in the red. The sector with the fewest losses was Consumer Staples, down 0.66 per cent. The worst-performing sector was Materials, down 3.02 per cent.

The best-performing stock in the S&P/ASX 200 was Appen (ASX:APX), closing 17.44 per cent higher at $13.20. It was followed by shares in Nuix (ASX:NXL) and United Malt Group (ASX:UMG).

The worst-performing stock in the S&P/ASX 200 was EML Payments (ASX:EML), closing 45.63 per cent lower at $2.80. It was followed by shares in St Barbara (ASX:SBM) and Perenti Global (ASX:PRN).

Asian markets

Japan's Nikkei has lost 1.59%.
Hong Kong's Hang Seng is closed due to National Day.
China's Shanghai Composite has lost 0.56%.

Commodities and the dollar

Gold is trading at US$1873.87 an ounce.
Iron ore is 3.10 per cent higher at US$224.44 a ton.
Iron ore futures are pointing to a fall of 2.40 per cent.
Light crude is trading $0.64 lower at US$62.87 a barrel.
One Australian dollar is buying 77.89 US cents.

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