28/09/2021 - 15:45

Biggest loss in six days for shares on ASX

28/09/2021 - 15:45

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Australian shares had their steepest fall in the past six trading days amid expectations US authorities will soon start taking away economic stimulus.

Australian shares had their steepest fall in the past six trading days amid expectations US authorities will soon start taking away economic stimulus.

Market giant CSL, the miners, technology and property shares fell most on Tuesday as equities' overnight troubles on Wall Street worsened on the ASX.

US bond yields overnight climbed to a three-month high following the Federal Reserve last week indicating fiscal stimulus could be tapered as early as November.

Central banks have bought swathes of bonds during the pandemic which has markets in many countries to record heights.

Deep Data Analytics chief executive Mathan Somasundaram said the rising yields were weighing on equities.

He said investors in emerging nations such as China and India were particularly likely to sell US bonds for cash amid a weak global economy.

"When you have a weak economy and want cash, the obvious thing to do is sell your substantial US Treasuries holding," he said.

These economies were particularly struggling with coronavirus due to vaccine shortages, he said.

Rising bond yields generally have an adverse effect on shares.

Investors will be looking to US Federal Reserve chair Jerome Powell's appearance at a US Senate hearing this week for guidance.

In Australia, retail spending figures for August continued a melancholy mood.

Coronavirus lockdowns in some states caused retail turnover to fall by 1.7 per cent.

The benchmark S&P/ASX200 index closed lower by 108.6 points, or 1.47 per cent, to 7275.6.

The All Ordinaries closed down 110 points, or 1.43 per cent, to 7580.7.

CSL shed 3.85 per cent to $294.47 and caused healthcare shares to be the worst performing category.

Fortescue Metals proved one of the major mining victims after it lost more than five per cent.

Rio Tinto shed almost three per cent and BHP slipped 2.25 per cent.

The big four banks were higher early in trade but closed less than one per cent lower.

Energy shares surged. Demand for oil is growing as some parts of the world ease coronavirus rules on travel.

Oil Search gained more than seven per cent. Santos and Woodside shares were up more than five per cent.

Beach Energy shares were up 10.53 per cent to $1.36.

The company has agreed to supply liquefied natural gas to BP Singapore.

Beach will provide 3.75 million tonnes from the Waitsia gas project in Western Australia.

The price will be linked to Brent and Japan Korea Marker indices.

Origin Energy will invest a further $70 million in technology provider and renewables group Octopus Energy to maintain a 20 per cent stake.

A sustainable investment group has bought seven per cent of Octopus and tripled the latter's value to about $5.5 billion.

Origin last year took its first stake in Octopus, which has more than 5 million retail customers mostly in Europe.

Origin shares were up 5.32 per cent to $4.75.

Telix Pharmaceuticals received a $12.1 million tax refund for research.

Company leaders also expect to receive more tax rebates on overseas research following discussion with the Australian government.

Shares were down 1.36 per cent to $5.82.

Growthpoint Properties will invest more in industrial property.

Growthpoint will buy more than $50 million worth of stapled securities in industrial property trust APN Industria REIT.

The latter last week revealed plans for an equity raising.

Growthpoint shares were down 1.89 per cent to $4.15.

The Australian dollar was buying 72.68 US cents at 1725 AEST, lower from 72.77 US cents at Monday's close.

ON THE ASX

* The benchmark S&P/ASX200 index closed lower by 108.6 points, or 1.47 per cent, to 7275.6 on Tuesday.

* The All Ordinaries closed down 110 points, or 1.43 per cent, to 7580.7.

* At 1725 AEST, the SPI200 futures index was down 13 points, or 0.18 per cent, at 7226 points.

CURRENCY SNAPSHOT

One Australian dollar buys:

* 72.68 US cents, from 72.77 cents on Monday

* 80.95 Japanese yen, from 80.52 yen

* 62.24 Euro cents, from 62.16 cents

* 53.15 British pence, from 53.18 pence

* 104.10 NZ cents, from 103.66 cents.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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