Banks pass on full rate hike, Qantas takes off: ASX declines 0.1% at noon

Market Reports

by Melissa Darmawan

Australian stocks are falling as the hour goes on, at one point rebounding after two days of losses as energy and banks rally, offsetting losses by flight and travel stocks. The marginal gain but now a marginal loss follows the nation’s first rate hike since November 2010 in a fight to combat multi-year high inflation with Aussie bonds being aggressively sold off in response.

At noon, the S&P/ASX 200 is 0.1 per cent lower at 7,325. The SPI futures are pointing to fall of 4 points.

Commonwealth Bank (ASX:CBA) was the first cab off the rank to raise its standard variable mortgage rates, followed by ANZ (ASX:ANZ) and then Westpac (ASX:WBC).

A rise in interest rates helps the bank's net interest margin, a revenue stream which is based on the money they lend to consumers. Macquarie Group (ASX:MQG) is leading the pack, up 1.7 per cent at $206.80 while Commonwealth Bank of Australia (ASX:CBA) is adding the least, eking out a 0.09 per cent gain at $102.35.

Bulk metals didn’t trade due to the market being closed but thermal coal recovered most of the losses on Monday, up 8.9 per cent to US$327 a ton. Whitehaven Coal (ASX:WHC) is on the move, up 1.1 per cent to $4.87, while Rio Tinto (ASX:RIO) is bucking the trend to its peers, eking out a 0.1 per cent gain to $111.90. BHP Group (ASX:BHP) is down 0.5 per cent to $47.41.

In company news, Nine Entertainment (ASX:NEC) has reported at the Macquarie Conference that it expects its financial year 2022 EBITDA to be higher by 22 per cent compared to the prior corresponding period as TV ad market conditions remained strong. Shares jumped 1.4 per cent to $2.61.

Meanwhile, shares in Seven West Media (ASX:SWM) have tumbled 4.2 per cent to 62.7 cents despite upgrading its EBITDA expectations for financial year 2022 from previous guidance from $315 million to $325 million to $335 million and $340 million.

Imugene (ASX:IMM) continues to tumble and is down over 11 per cent, following the termination of a supply deal with Merck & Co.

Temple & Webster (ASX:TPW) shares have dived 8.4 per cent to $4.94 after the online furniture retailer reported a disappointing trading update, missing market consensus earnings targets. Sales increased by 23 per cent for January 1 to April 30, against a sales update in February for the beginning of the second half which showed revenue growth of 26 per cent.

China markets are offline for Labour Day and Japan is shut for Greenery Day.

Best and worst performers

The best-performing sector is energy, up 1.3 per cent. The worst-performing sector is consumer discretionary, down 0.9 per cent.

The best-performing stock in the S&P/ASX 200 is Orora (ASX:ORA), trading 3.1 per cent higher at $3.98. It is followed by shares in Incitec Pivot (ASX:IPL) and HUB24 (ASX:HUB).

The worst-performing stock in the S&P/ASX 200 is Imugene (ASX:IMU), trading 11.1 per cent lower at $0.16. It is followed by shares in ARB Corporation (ASX:ARB) and ZIP Co. (ASX:ZIP).

Commodities and the dollar

Gold is trading at US$1863.16 an ounce.
Iron ore last traded at US$142.35 a ton.
Iron ore futures are pointing to a rise of 4.19 per cent.
One Australian dollar is buying 71.08 US cents.

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