ASX in the red after Wall Street fall, and BHP warns global economy to slow because of inflation and Ukraine war
The Australian share market has lost ground following a slide on Wall Street, and big miner BHP expects the global economy to slow down in the coming year because of inflation and the war in Ukraine.
- The Dow Jones index fell 0.7pc to 31,073, the S&P 500 index fell 0.8pc to 3,831, and the Nasdaq Composite fell 0.8pc to 11,360
- The FTSE 100 index rose 0.9pc to 7,223, the CAC 40 in Paris rose 0.9pc to 6,092, while the DAX rose 0.7pc to 12,960
- At 12:50pm AEST, the All Ordinaries index was down 0.2pc to 6,873, while the ASX 200 index was down 0.25pc to 6,670.
The local market was volatile as losses in healthcare, technology, resources and financial stocks, offset gains in the energy sector.
At 12:50pm AEST, the All Ordinaries index was down 0.2 per cent to 6,873, while the ASX 200 index was down 0.25 per cent to 6,670.
The best performers on the ASX 200 were lithium brine miner Lake Resources (+8 per cent), investment firm Pendal Group (+4.4 per cent), and coal firm Whitehaven Coal (+4.2pc).
Leading the losers on the ASX 200 were data financial platforms company Hub 24 (-5.5 per cent), online bookmaker Pointsbet (-4.9pc), and cloud provider Xero (-4.9pc).
The Australian dollar rose after the release of the minutes from the Reserve Bank’s board meeting earlier this month, where it raised interest rates by 0.5 percentage points to 1.35 per cent.
In the minutes, the central bank said that more interest rate rises were needed to contain inflation.
At 12:50pm AEST, the local currency was up 0.2 per cent to around 68.25 US cents.
Big miner BHP said iron ore, copper, and coal production rose over the June quarter from the March quarter, and it made record sales for Western Australian iron ore over the year.
Overall, iron production was flat over the year to June at 253.2 million tonnes.
The company also mined a record amount of copper ore at its Escondida mine in Chile.
However, BHP chief executive Mike Henry gave a warning for the year ahead about market volatility and the impact of inflation on the global economy partly because of the conflict in Ukraine.
“Broader market volatility continues and we expect the lag effect of inflationary pressures to continue through the 2023 financial year, along with labour market tightness and supply chain constraints,” Mr Henry said in BHP’s production report.
Mr Henry also said the miner was assessing the impact of the increase in coal royalties by the Queensland government.
“The near tripling of top-end royalties has worsened what was already one of the world’s highest coal royalty regimes, threatening investment and jobs in the state,” he said.
Mr Henry said BHP’s $US5.7 billion Jansen potash project in Canada was tracking to plan and the miner is hoping to bring forward first production to 2026.
BHP shares lost their gains and were lower at 1pm AEST at $36.78, down 0.5 per cent.
JB HiFi online sales soar
Electronics retailer JB HiFi saw unaudited annual net profit rise by 7.7 per cent to nearly $545 million, with online sales up by half to $1.6 billion.
Online sales represented nearly 18 per cent of total sales.
Overall sales for the chain were up 3.5 per cent to $9.2 billion.
JB Hifi shares gained 4.1 per cent to $42.53 in lunchtime trade.
Wall Street slides
US stocks ended lower after bank stocks erased their gains and shares of tech giant Apple fell on a Bloomberg report saying the company planned to slow hiring and spending growth next year.
Apple shares dropped 2 per cent to $US147.07.
Goldman Sachs warned it may slow hiring and cut expenses after reporting that quarterly profit fell by almost half, while a Bloomberg report said that Apple was planning to do the same next year.
The Dow Jones Industrial Average fell 216 points or 0.7 per cent to 31,073, the S&P 500 index lost 32 points or 0.8 per cent to 3,831, and the Nasdaq Composite dropped 0.8 per cent to 11,360.
Shares gained ground in Europe.
In London, the FTSE 100 index rose 0.9 per cent to 7,223, the CAC 40 in Paris gained 0.9 per cent to 6,092, while the DAX in Germany rose 0.7 per cent to 12,960.
Spot gold fell 0.2 per cent to $US1705.49 at 10:20am AEST, while Brent crude oil was down 0.7 per cent to $US105.51 a barrel, coming off its $US5 rise the previous day after Saudi Arabia declined to make any promises about future output increases.
Crude oil rallied after Saudi Arabia declined to make any promises about future output increases