RBA says 2022 interest rate hike is "plausible": ASX down 1.1% at noon

Market Reports

by Lauren Evans

The Australian sharemarket has slumped after three days of gains after Wall St tumbled on US inflation coming in hotter than expected. All sectors are red with technology leading the declines, except materials supported by the rise of the underlying commodity price.

Investors are digesting Governor Philip Lowe's testimony before Parliament after the said  it's "plausible" a rate hike "could be on the agenda" later this year and "if things line up" the RBA will discuss a rate rise later this year.

Major banks are lower except Westpac (ASX:WBC) trading 0.2 per cent higher at $22.67 and National Australia Bank (ASX:NAB) trading 0.1 per cent higher at $29.71. Commonwealth (ASX:CBA) has fallen 1.7 per cent to $99.08, Macquarie Group (ASX:MQG) has declined 0.6 per cent to $192.23 and ANZ Banking Group (ASX:ANZ) is trading 0.2 per cent lower at $27.65. 

Gold stocks are lower, Northern Star (ASX:NST) is down 2.2 per cent at $8.45, Evolution Mining (ASX:EVN) is down 1.6 per cent at $3.66 and Newcrest Mining (ASX:NCM) trading 0.04 per cent lower at $22.73.

Energy stocks are mixed as Beach Energy (ASX:BPT) has fallen 1.16 per cent to $1.49, Woodside Petroleum (ASX:WPL) is down 0.3 per cent at $26.44 and Santos (ASX:STO) is trading 0.07 per cent higher at $7.44.

Heavyweight miners are higher led by Rio Tinto (ASX:RIO) up 1.7 per cent to $121.01. BHP (ASX:BHP) has added 1.2 per cent to $48.84 and Fortescue Metals (ASX:FMG) is trading 0.7 per cent higher at $22.43.

Elsewhere, Unibail-Rodamco Westfield (ASX:URW) has agreed to sell a 45 per cent stake in Westfield Carré Sénart, plus provide asset and property management services under a joint venture with Societe Generale Assurances and BNP Paribas Cardif. Shares are trading 7 per cent higher at $5.63. This is the best-performing stock. 

Baby Bunting's (ASX:BBN) after tax profit rose 12.2 per cent to $8.1 million, coming in below expectations of $11 million for the first half of financial year 2022. The company posted sales of $239.1 million, up 10 per cent from the same time the year before. They also unveiled an interim fully franked dividend of 6.6 cents. The baby goods retailer benefited from stores remaining open during the period and strong inventory. Shares are down 3 per cent to $5.27. 

Insurance Australia Group’s (ASX:IAG) first half profit after tax returned to profit posting a gain of $173 million, after its $462 million loss a year ago.The insurer has reaffirmed its insurance margin guidance of 10 to 12 per cent and unveiled an interim dividend of 6 cents per share. Shares are trading 1.1 per cent higher at $4.60. 

At noon, the S&P/ASX 200 is 1.1 per cent or 76.8 points lower at 7211.7.

The SPI futures are pointing to a fall of 72 points.

Best and worst performers

The best-performing sector is Materials, up 0.2 per cent. The worst-performing sector is Real Estate Investment Trusts, down 3 per cent.

The best-performing stock in the S&P/ASX 200 is Unibail-Rodamco-Westfield (ASX:URW), trading 7.2 per cent higher at $5.64. It is followed by shares in ALS (ASX:ALQ) and Insurance Australia Group (ASX:IAG).

The worst-performing stock in the S&P/ASX 200 is Appen (ASX:APX), trading 7.3 per cent lower at $8.33. It is followed by shares in Life360 (ASX:360) and Zip Co (ASX:Z1P).

Commodities and the dollar

Gold is trading at US$1825.06 an ounce.
Iron ore is 4.8 per cent higher at US$153.75 a ton.
Iron ore futures are pointing to a rise of 3.67 per cent.
One Australian dollar is buying 71.36 US cents.

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