Home / Daily Market Update / Rate hold sees local stocks retreat

Australian shares slipped back on Tuesday, led by a sell-off in commodity stocks, on a day when – as widely predicted – the Reserve Bank left the cash rate at 4.35 per cent at its final meeting of the year.

The S&P/ASX 200 closed 63.1 points, or 0.9 per cent, lower at 7061.6, while the broader All Ordinaries index receded 66.3 points, also 0.9 per cent, to 7,269.

The big miners led the gauges lower: BHP fell 62 cents, or 1.3 per cent, to $46.52; Rio Tinto dropped $1.32, or 1 per cent, to $125.60; and Fortescue slid 22 cents, or 0.9 per cent, to $25.07. Iron ore futures in Singapore are trading near $US128 per tonne as traders continue to assess the outlook for Australia’s premier export.

Lithium stocks were also under the pump, amid a weakening demand outlook for the battery metal. Producer Pilbara Minerals sagged 30 cents, or 8.5 per cent, to $3.23; fellow producer, Allkem lost 34 cents, or 3.9 per cent, to $8.30; IGO, which mines nickel as well as lithium, dropped 54 cents, or 6.7 per cent, to $7.49; and Mineral Resources, which produces iron ore and lithium, retreated $2.60, or 4.3 per cent, to $57.32.

Some of the lithium project developers lost the plot, with Liontown Resources slammed 12.5 cents, or 9.2 per cent, lower to $1.235; fellow developer Core Lithium down 2.5 cents, or 9.8 per cent, to 23 cents; and US-based Piedmont Lithium off 3 cents to 37 cents, for a 7.5 per cent slide.

Gold miners lost much of Monday’s sheen, with Capricorn Metals plunging 41 cents, or 8.4 per cent, to $4.45, as the market digested news that the chairman and a director had sold $32.2 million worth of shares, off-market. Perseus Mining dropped 10.5 cents, or 5.2 per cent, to $1.925; and Ramelius Resources gave up 9 cents, or 5.1 per cent, to $1.66. Northern Star Resources was down 52 cents, or 4 per cent, to $12.38; Gold Road Resources retreated 5 cents, or 2.5 per cent, to $1.925; and De Grey Mining lost 3 cents, or 2.1 per cent, to $1.375.

In coal, Whitehaven Coal gave up 13 cents, or 1.8 per cent, to $7.07; and New Hope Corporation shed 7 cents, or 1.4 per cent, to $5.03; but Stanmore Resources regained 7 cents, or 1.9 per cent, to $3.82; and Coronado Global Resources added 4 cents, or 2.4 per cent, to $1.74.

Woodside Energy was a drag on the energy sector, falling 82 cents, or 2.3 per cent, to $29.65 as Brent crude held near $US78 a barrel. Climate activists have also scaled a 140-metre crane next to the company’s Perth headquarters in protest. Santos lost 6 cents, or 0.9 per cent, to $6.76.

There were chunky falls from uranium miner Paladin Energy, down 4.5 cents, down 4.3 per cent, to $1.01; Nickel Industries, which eased 3 cents, or 4.2 per cent, to 68 cents; Lynas Rare Earths, which lost 20 cents, or 3.1 per cent, to $6.24; and Sandfire Resources, which weakened 19 cents, or 3 per cent, to $6.17.

In contrast, Canadian uranium mine developer NexGen Energy spiked 31 cents, or 3.2 per cent, to $10.04.

Shares and Whispirs

On the industrial side, software company Whispir jumped 5.5 cents, or 11.2 per cent, to 54.5 cents, after reporting that it has received a letter of intent from Pendula regarding a non-binding indicative proposal to acquire it. Whispir is already in receipt of a takeover offer, from mobile messaging software business Soprano Design, of 48 cents, which Whispir has rejected: Pendula told Whispir that its proposed non-binding indicative offer would be at a premium to this bid.

National Australia Bank gained 12 cents, or 0.4 per cent, to $28.77; and Westpac advanced 3 cents to $21.42; but Commonwealth Bank lost 41 cents, or 0.4 per cent, to $104.71; and ANZ slipped 6 cents, or 0.3 per cent, to $24.39.

Biotech heavyweight CSL softened $1.05, or 0.4 per cent, to $263.12; Telstra gave up 1 cent, to $3.78; Woolworths gained 16 cents, or 0.5 per cent, to $35.01; Wesfarmers lost 32 cents, or 0.6 per cent, to $52.42; and Coles firmed 8 cents, or 0.5 per cent, to $15.35.

Utilities stocks were the best-performing, with sector heavyweight Origin Energy all but single-handedly raising the sector 0. 6 per cent. Origin Energy added 17 cents, or 2.2 per cent to $8.03, after shareholders formally rejected a takeover proposal by Brookfield and EIG following a 13-month battle over the energy provider.

Biotech Mesoblast sank 9 cents, or 22.2 per cent, to 31.5 cents, after announcing a $55 million capital raising priced at 30 cents a share.

Apple landmark lifts tech stocks

In the US, the Dow Jones Industrial Average and the broader S&P 500 index both retreated, despite a new batch of jobs data showing a weakening labour market, indicating the Federal Reserve’s rate hikes may have had the desired cooling effect on the economy. The 30-stock Dow Jones lost 79.88 points, or 0.2 per cent, to 36,124, while the S&P 500 eased 2.6 points, to 4,567.18 points.

The tech-heavy Nasdaq Composite Index, however, advanced 44.42 points, or 0.3 per cent, to 14,229.6. The tech stocks were inspired by Apple, which moved above US$3 trillion ($4.5 trillion) in market capitalisation, a threshold it previously crossed in December 2022.

Elsewhere, Bitcoin topped US$44,000 in price for the first time since April 2022.

On the bond market, the US 10-year yield retreated 8.6 basis points to 4.173 per cent, while the 2-year yield lost 7.9 basis points, t0 4.579 per cent.

Gold has walked back from its record price, down US$13.48, or 0.7 per cent, to US$2,019.76 an ounce; the global benchmark Brent crude oil grade is down 92 cents, or 1.2 per cent, to US$77.11 a barrel, and US West Texas Intermediate oil is trading 88 cents, also 1.2 per cent, lower at US$72.16.

The Australian dollar is buying 65.52 US cents this morning, down from 65.82 cents at the ASX close on Tuesday.