Banks lead Aussie market lower

The Australian sharemarket closed at its lowest point in 11 months on Wednesday, hampered by a weak lead-in from Wall Street, and its interest-rate worries. The benchmark S&P/ASX 200 ended the session down 53.2 points, or 0.8 per cent, to 6890, its lowest close since November 3. Banks had a bad day, with the financials sub-index down 1.5 per cent, the worst performer of the S&P/ASX 200’s 11 industry groups. ANZ dropped 49 cents, or 1.9 per cent, to $24.92; National Australia Bank slid 48 cents, or 1.7 per cent, to $28.31; Commonwealth Bank dipped $1.60, or 1.6 per cent, to $98.09; and Westpac closed 31 cents, 1.5 per cent, weaker at $20.74.

Afterpay’s owner Block Inc. sank a further $1.65, or 2.4 per cent, to $66.11 after analysts at Citi cut their price target for the payments stock from $90 to $65. Block shares, which are dual-listed on the ASX and New York Stock Exchange, have almost halved in value in the past two months, and Block’s total market capitalisation has fallen to $US25.56 billion ($40.5 billion) – meaning that it is now worth less than what Block paid for Afterpay in 2021.

On the industrial front, Telstra was down 5 cents, or 1.3 per cent, to $3.78; Qantas shed 9 cents, or 1.8 per cent, to $4.93; Ansell lost 26 cents, or 1.2 per cent, to $21.51; and software player Data#3 surged 22 cents, or 3.3 per cent, to $7.00.

Resources mostly lower

In big mining, BHP eased 12 cents, or 0.3 per cent, to $43.72; but Rio Tinto advanced 82 cents, or 0.7 per cent, to $113.62; and Fortescue Metals gained 5 cents, or 0.2 per cent, to $20.78. On planet lithium, producer Allkem gave up 25 cents, or 2.2 per cent, to $10.90; fellow producer Pilbara Minerals weakened 4 cents, or 1 per cent, to $4.05; IGO, which mines nickel as well as lithium, fell 32 cents, or 2.6 per cent, to $12.05; and Mineral Resources slipped 82 cents, or 1.3 per cent to $63.33, after finalising a $US1.1 billion debt offer. Among the lithium project developers, Core Lithium lost 2.5 cents, or 6 per cent, to 39.5 cents; US-based Piedmont Lithium eased 1.5 cents, or 2.5 per cent, to 58.5 cents; and Lake Resources softened 1 cent, or 5.7 per cent, to 16.5 cents; but Liontown Resources, where iron ore magnate Gina Rinehart appears close to being able to block the $6.6 billion takeover offer by the world’s biggest producer of the battery metal, Albemarle, picked up 2 cents, or 0.7 per cent, to $2.97. Rinehart has bought 14.7 per cent of Liontown.  In coal, the sector was led downward by Coronado Global Resources, which dropped 9 cents, or 5.1 per cent, to $1.685; while Whitehaven Coal mislaid 9 cents, or 1.3 per cent, to $6.84; New Hope Corporation retreated 11 cents, or 1.7 per cent, to $6.23; Stanmore Resources was down 6 cents, or 1.6 per cent, to $3.60; and Yancoal Australia gave up 13 cents, or 2.5 per cent, to $5.10.

In gold, Ramelius Resources closed 6 cents, or 4.3 per cent, higher at $1.465; Gold Road Resources added 3 cents, or 1.9 per cent, to $1.605; Evolution Mining strengthened 5 cents, or 1.6 per cent, to $3.17; Capricorn Metals gained 9 cents, or 2.3 per cent, to $4.02; and Northern Star advanced 14 cents, or 1.4 per cent, to $10.18; but West African Resources eased 3 cents, or 4.2 per cent, to 69 cents. Copper producer Sandfire Resources lost 8 cents, or 1.3 per cent, to $6.02; and rare earths producer Lynas Rare Earths walked back 4 cents, or 0.6 per cent, to $6.50.

Unofficial jobs report surprises Wall Street In the US, stocks snapped a three-day losing streak as bond yields eased from 16-year highs. following the release of much weaker-than-expected jobs data. Economists had expected the ADP Non-farm employment report to show a gain of 160,000 jobs in September – in keeping with the gauge’s recent form of 150,000-plus gains – but the number came in at just 89,000 jobs. Although this is a private report (ADP Is a payroll processing firm) and the official jobs report does not come out until Friday), markets were surprised by the soft figure, and the tentative signs of a weakening jobs market. For the official jobs report, the economists’ consensus estimates that non-farm payrolls increased by 170,000 in September, down from a 187,000 increase in August, according to Dow Jones. But the pencil may be taken to those estimates between now and Friday.

The 30-stock Dow Jones Industrial Average gained 127.17 points, or 0.4 per cent, to close at 33,129.55. The broader S&P 500 index rose 34.3 points, or 0.8 per cent, to 4,263.75, and the tech-laden Nasdaq Composite index kicked up 176.54 points, or 1.4 per cent, to 13,236.01.

The yield on the US 10-year Treasury had risen as high as 4.884 per cent before the ADP jobs figure came out, but ended the day down 6.8 basis points, at 4.736 per cent. The 2-year yield slid 11.3 basis points, to 5.071 per cent. Gold traded US$2.38 lower, to US$1,821.30 an ounce, while the global benchmark Brent crude oil grade plunged US$4.93, or 5.4 per cent, to US$85.99 a barrel, and West Texas Intermediate crude slid US$5.01, or 5.6 per cent, to US$84.22 a barrel.

The Australian dollar is buying 63.21 US cents this morning, up from 63.05 US cents at the ASX close on Wednesday.