Miners gain led by Fortescue, Beijing moves boost iron ore: ASX closes 0.6% lower

Market Reports

by Melissa Darmawan

The Australian sharemarket fell 0.6 per cent or 42 points at 7,382, sliding for the fourth straight day, its worst one-day fall in the past seven days as investors digested the jobs data on the local bourse after an inflation jump on Wall St.

The XJO at its worst level was down 1.3 per cent amid a climb in bond yields and a slip in the Aussie dollar. Despite this, the index managed to gain some momentum with the help of the iron ore miners as the futures pointed to a brighter outlook.

Adding to the optimism was news that Beijing may loosen their grip around rules on domestic bond issues by Chinese property developers according to media reports. Embattled property developer managed to rustle up the funds to meet its obligations after a 30 day period ended for bonds worth to value of $200 million. Asian markets are rallying as property shares surge on renewed hope.

Back in the winner’s corner was materials rising 2.3 per cent after being the worst performer yesterday but the winner the day before. Communication services marginally rose 0.8 per cent while the others closed in the red. The biggest pressure was information technology down 2.5 per cent with healthcare and energy falling near the 2.0 per cent mark.

Nearmap (ASX:NEA) tumbled after presenting their annual contract trading guidance as they held their AGM indicating growth at a slower pace. The aerial mapping provider guided to an annual contract value of $150 million to $160 million for financial year 2022, a growth of 17 to 25 per cent. However, when you compare this to the previous year, it is at a slower rate of 26 per cent that was achieved.

Ansell (ASX:ANN) fell 2.5 per cent after citing that trading conditions had been more challenging than expected for the financial year 2022. The personal protection equipment supplier maintained its EPS guidance.

Orica (ASX:ORI) sank 3.7 per cent after the company posted a 32 per cent fall in financial year 2021 earnings from continuing operation atttributed to unfavourable foreign exchange movements. The explosives manufacturer also experienced disrupted thermal coal trade flows due to ongoing trade tensions with China, increased sea freight costs, and rising input costs.

Nine Entertainment (ASX:NEC) added 3.0 per cent after the media giant told shareholders at its AGM that momentum from the last financial year continued into financial year 2022 advertising market remains buoyant across all key advertising segments.

Afterpay (ASX:APT) and CSL (ASX:CSL) both fell 2.4 per cent, Wesfarmers (ASX:WES) dropped 1.4 per cent, while Telstra and Woolworths bucked the trend closing 0.5 per cent higher.

Across the major banks, National Australia Bank (ASX:NAB) and Commonwealth Bank (ASX:CBA) both fell 1.6 per cent, ANZ Bank (ASX:ANZ) shed 0.2 per cent while Westpac (ASX:WBC) closed 0.1 per cent lower. Macquarie Group (ASX:MQG) fell 0.7 per cent.

Meanwhile, Fortescue Metals (ASX:FMG) took the limelight as the second best performing stock after chief executive Elizabeth Gaines gave a strong impression on funding over its clean energy unit, Fortescue Future Industries and list of green energy projects.  Rio Tinto (ASX:RIO) added 1.9 per cent while BHP (ASX:BHP) surged 2.6 per cent after holding their AGM.

Join me for Stocks of the Hour as I cover the moves from Xero (ASX:XRO), Ramsay Health Care (ASX:RHC), and Chalice Mining (ASX:CHN).

Tonight, investors will look to Wall St without the bond market open for Veterans Day paying its respects to those who served in the US military. This could give stocks a chance to erase some losses and an opportunity for tech shares as they were major underperformer out of the three indexes amid the rising 10 year bond yield. The job openings report is also due as earnings season starts to wind down.

Local economic news

In October, the economy lost 46,300 jobs against a market expectation of a fall of 50,000 while the participation rate rose by 0.1 basis point to 64.7 per cent.

The shed in jobs followed September’s results where employment fell at 138,000 mainly due to the lockdowns seen in NSW and Victoria.

The unemployment rate rose by 0.6 basis points to 5.2 per cent around where it was before the Delta variant outbreaks as per the Australian Bureau of Statistics.

The participation rate saw its first increase since June this year reflecting a large increase in unemployment of 82,000 people.

Futures

The Dow Jones futures are pointing to a fall of 30 points.
The S&P 500 futures are pointing to a rise of 2 points.
The Nasdaq futures are pointing to a rise of 16 points.
The SPI futures are pointing to a fall of 47 points when the market next opens.

Best and worst performers

The best-performing sector was Materials, up 2.3 per cent. The worst-performing sector was Information Technology, down 2.5 per cent.

The best-performing stock in the S&P/ASX 200 was Chalice Mining (ASX:CHN) closing 9.6 per cent higher at $10.01, followed by shares in Fortescue Metals Group (ASX:FMG) and Regis Resources (ASX:RRL).

The worst-performing stock in the S&P/ASX 200 was Nearmap (ASX:NEA) closing 12.3 per cent lower at $1.89, followed by shares in Xero (ASX:XRO) and Zip Co (ASX:Z1P).

Asian markets

Japan's Nikkei has gained 0.5 per cent.
Hong Kong's Hang Seng has lost 0.1 per cent.
China's Shanghai Composite has gained 0.7 per cent.

Commodities and the dollar

Gold is trading at US$1850.89 an ounce.
Iron ore is 3.2 per cent lower at US$89.50 a ton.
Iron ore futures are pointing to a rise of 5.3 per cent.
Light crude is trading $0.25 higher at US$80.31 a barrel.
One Australian dollar is buying 73.05 US cents.

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